Troy Asset Management invests in equities, fixed income and commodities and holds cash (predominantly in its balanced and lower risk income mandates).
Equities: Troy has a rigorous focus on quality. We invest in businesses with high returns on invested capital which we consider to be sustained by durable competitive advantages. We favour stable and growing companies with a strongly differentiated product or service that new or existing rivals struggle to copy. These are companies with low risk to their earnings that permit sustained high levels of profitability. We also pay particular attention to how management allocates capital and typically avoid highly acquisitive and indebted companies. We have traditionally found more of these equities in developed markets.
Fixed Income: Fixed Income investments are currently almost exclusively UK and US index linked sovereign debt. These investments are held for their ability to preserve the value of investors' capital and as such the avoidance default risk, currency risk and liquidity risk are central to the investment rationale.
At some time Troy may choose to invest more widely in the debt market and could potentially invest in a range of sovereign debt as well as the debt of corporates and other issuers.
Commodities: Troy’s investment in commodities is exclusively in gold bullion. We view this as a unique form of currency and for this reason as distinctly different from other hard commodities. It is held in physically backed form. Because gold is not consumed much of the world gold stock has been in circulation for several decades and is not easily attributable to a source.
Cash: Cash is currently held at the respective Fund’s custodian and is not loaned out on term deposit or invested in money market instruments.