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Awards for investment excellence 2006: Standing apart

13 April 2006


By its very nature, contrarianism is always out of fashion. Deliberately going against consensus opinion, contrarians buy the unloved and overlooked stocks that go on to become winners – an approach that requires patience, exhaustive research and nerve. Skagen Funds has risen quickly to become the biggest manager in the Norwegian market by ploughing this lonely furrow – but its impressive performance means that its brand of contrarian investing is now becoming popular with investors abroad. Claire Milhench reports on this year's Firms to Watch.

Read more: ING investment equity asset manager mandate

Contrarians are used to being unloved. But in the last few years Skagen Funds has enjoyed spectacular growth to become Norway's biggest investment manager, with a 25% share of the market. As Filip Weintraub, fund manager of Skagen Global, says ruefully: "That wasn't our ambition when we started." Indeed, when the firm was founded in 1993, Skagen's managers ran money for themselves, family and friends. The three founders, Kristoffer Stensrud, now investment director and manager of the emerging markets-focused Kon-Tiki Fund, Åge Westbø, and Tor Dagfinn Veen, still own large shares in the company, although other portfolio managers have subsequently taken stakes. Weintraub, a Swede who has been with the firm for five years, says all his personal wealth is in the company and its funds.
Skagen's contrarian approach may seem risky to the uninitiated, but Weintraub says that from the outset the goal was to deliver strong absolute returns,...