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STEP Journal

Beware hidden investment risks

Paul Bailey and Dr Raymond Backreedy, February 2020

Paul Bailey is Investment Director, and Dr Raymond Backreedy is Chief Investment Officer, at Sparrows Capital, London.


The recent collapse of a high-profile UK fund highlights the risks associated with individual investment funds. Most trustees appoint discretionary managers to select a portfolio of direct holdings or funds to meet the trust’s objectives. Although this diversification reduces the risk associated with specific strategies and styles, trustees should also consider the risk inherent within the investment process.

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