“Earnings is what really matters,” he tells Portfolio Adviser editorial director Julian Marr. “Just making sure companies can execute on their strategy and seeing that play out in earnings will be the most important thing to watch out for.

“It is interesting that, despite all we have talked about in terms of challenges for the economy, earnings growth has actually been pretty good. I talked about the job cuts we have seen in the tech sector, for example, but the other side to that is that has delivered pretty significant cost-cuts and earnings upgrades.”

Trust merger

Fidelity China Special Situations is set to absorb the assets of rival trust Abrdn China, which will then be wound up, in a deal that would create a trust with total assets of some £1.6bn. The proposals, which are subject to approval by both sets of shareholders, are expected to be effective by the end of March 2024.

In this interview, Nicholls also reviews how the Chinese market fared over 2023, discusses changes he made to his portfolio through the year and offers his thoughts on how the ever-present question of government policy is currently affecting both the prospects for businesses and his own thinking in relation to future investments.You can view the whole video by clicking on the picture above, while the timecodes for each question are set out below:

00:22 What have been the main issues affecting Chinese equities in 2023 and how have they fared versus other assets over the year?

01:37 What has that meant for your portfolio and what changes have you made to allocations over 2023?

02:35 Government policy is always a big consideration for investors in China – what is your current take here?

03:57 Is there a tangible link between Chinese government policy and the returns you see from a portfolio?

05:15 Given what we have discussed so far, are you finding any sectors especially interesting – or worrying?

07:03 Finally, as an investor in China, are there any developments you will be particularly looking out for in 2024?

“If you think back to June 2020 and you were a CFO in the middle of Covid, what would you do?” he says to Portfolio Adviser editorial director Julian Marr. “With interest rates at near-zero, you would fill your boots with as much financing as you could get and fix it for four or five years. And why wouldn’t you? If you don’t need it, you pay it back early but having that in place would have been the prudent thing to do for 90% of companies.

“That being so, however – and similar to home loans – a lot of companies have not yet been hit by the impact of higher rates because they have been fixed for that four or five-year period. The rubber starts to hit the road there at the back end of 2024 so that is what we will be looking at. Who knows where rates will be but, if we are sitting here this time next year and they have not come down quite a bit, that will have important implications.”

Pricing power and leverage

In this interview, Stotzel also covers the importance of pricing power and avoiding leverage when selecting portfolio holdings, the unexpectedly solid performance of European equities over 2023 and why he and his colleagues are avoiding industrials while maintaining an overweight exposure to the diversified financials subsector. You can view the whole video by clicking on the picture above, while the timecodes for each question are set out below:

00:20 As we reach the end of 2023, how have European equities fared this year?

02:12 What have you changed within the portfolios this year as the investment backdrop has evolved?

05:10 Are there any sectors, regions or themes you are particularly interested in – or are avoiding?

08:46 Are there any specific developments you will be watching out for in 2024?

In the second episode of PA Pod devoted to LGBT+ in Pride month, host Natalie Kenway, editor-in-chief at MA Financial Media, is joined by Jake Hague, supplier sustainability and governance manager at Aviva Investors, and LGIM’s Andrzej Pioch, fund manager in the multi-index team at Legal & General Investment Management (LGIM).

They share their insights on where the industry has made progress – setting up networks and recruiting from a more diverse pool – and where there are still hurdles to tackle – namely having visible role models and allies, collecting LGTBQ data and addressing the other letters outside of the ‘L’ and the ‘G’ in a society that is fast changing.

Click below to listen.

The first podcast series running until the summer will focus on diversity with episode one looking at gender. Host Natalie Kenway, editor-in-chief at MA Financial Media, is joined by Victoria Hasler, head of fund research at EQ Investors, and Jane Shoemake, client portfolio manager at Janus Henderson to discuss the progress made in the investment industry in terms of being more inclusive regardless of gender.

The trio discuss whether organisations are creating an attractive environment for women to work in, and how this has changed since the start of their careers. They also look at the benefits of having a supportive boss and why there still aren’t enough women role models in management positions. They explore attitudes to women working a less than five day working week, and how normalising flexible working for both women and men, whether they have children or not, is vital.

Tragically, nobody saw what happened. The train pulled out of the station, another arrived, and Sarah lost her arm and leg.

In a LinkedIn post on 26 November, Sarah made her story known. You can find it, in her own words, here.

She agreed to be interviewed by Portfolio Adviser and shared her recovery, return to work and incredible bravery and spirit that has got her to where she is today – working back in the office and in an industry she loves, and hiking at weekends.

The full video interview is above and transcript below.

To find out more about how to support Sarah and her family, click here.

NK: Hello, I’m Natalie Kenway, editor in chief at MA Financial Media. Today we have quite a different but very important interview. I’m joined by Sarah de Lagarde who is global head of communications at Janus Henderson. Last year, she endured a tragic accident that resulted in life changing injuries. I will let you explain that. I’m sure it must be very difficult to relive, but please share what you can with us.

SDL: Well, thank you for having this chat with me, it’s lovely to see you again. I can give you a little bit of detail around the accident. One point that I wanted to make straight off the bat was that it was an accident. It was a very silly accident. Like a split second, 10 seconds, it took for me to fall down the gap in between the train and the platform.

I was in a hurry, you run, you trip and I fell against the closing doors of the tube. And then in between the gap between the train, in between the train and the platform. But I got rescued and I’m here today.

NK: We are so thankful that you are here today with us. Tell us about those first two months of recovery. What was the most important thing for you to consider at that time?

SDL: The first two months were probably the hardest, I can’t sugarcoat any of that. I was in shock because it was such a sudden thing. And yet with these injuries that will be with me for the rest of my life, it was really hard psychologically and physically to come to terms with that.

But the driving force for me to recover was to be with my family, to be with my two girls and my husband and that was the driving force to recover as quickly as possible, I had one aim and that was to be at home for Christmas. That was a promise that I made to my family. And so I was lucky that my injuries healed well.

I was well looked after, all credit to the surgeons and the doctors at the Royal London Hospital, the helicopter emergency medical services were absolutely incredible. That now all contributed to the speedy recovery. I made it home for Christmas, actually I was a month early. On the 2nd of December, I was home.

NK: How did your employer reach out and support you in those first few months? What were they able to do to help you?

SDL: I was very positively surprised by the reaction that my colleagues had. I cried a lot in those first two months, but it was not necessarily because I felt sorry for myself, it was more because the reaction of people and how supportive they were. People got in touch by all sorts of means. I received boxes of cookies from the US. And I received all these cards, well-wishing messages… Everybody reached out and it wasn’t just my team, it was people from the executive committee, our new CEO Ali Dibadj reached out and we had a conversation over Zoom. Our CFO Roger Thompson came to visit me in the hospital several times and my boss did as well.

It was not just something that impacted me. When an accident like that happens, it impacts the people around you so much, more than anyone would think.

It’s not just immediate family, but it’s everyone around and I just realised at that point how wide our networks are.

NK: Absolutely and when we talked before about the LinkedIn post and you thought you might have a couple of likes to that, a few people in your network, and then it went around the world.

SDL: Exactly. I mean, it’s such a tragic story but the last thing I would ever have expected to happen to me and yet it happened in such a mundane situation – everybody takes the tube every day and nobody really thinks about how this could happen. The story went viral and it was not my intention at all, but that happened.

NK: I think it’s the way that you… your mindset and your bravery is just incredible. And that’s definitely coming across in everything that you’ve been posting. On the mindset element, I wanted to ask you about mental health. What has been really key for you to keep on top of? What’s helped you get through it? Obviously there’s been huge physical challenges, but what about the mental health side?

SDL: The mental challenges are just as big as the physical challenges. That was quite clear to me from the start and saying like, okay, there’s this whole physical element that I need to look after, but most importantly, I need to have a positive mindset.

I was privileged enough to get support from a psychiatrist at first and a psychologist specialising in PTSD and trauma. I still see the psychologist every week, and it’s really helpful because it unpacks all of these negative emotions that you would get in such a situation. The negative feelings are all there; the disappointment, the anger, the bitterness, – all of it is there, but I make a conscious decision every day to put those feelings into a box and save that box for when I talk to the psychologist.

NK: And what about the physical side? Obviously, you’re adapting to a new way of life. What have you found in going about your daily life that companies should be considering more, I guess, is what I’m trying to ask in terms of accessibility?

SDL: I was quite keen to return to work. You know me, I like keeping busy and I very much enjoy my job. I love the relationship with the industry. And it was quite clear in January when my husband returned to work full time and the kids were back at school and I was alone at home staring at the wall, I thought, this is where I can see depression getting hold of me.

NK: You need to keep your mind busy.

SDL: Exactly. And I was keen to return to work, but I was faced with this dilemma – I was going to go full in, five days and “I’m back and it’s okay”. But then I had to scale back this enthusiasm because the reality is I needed time to do all of the physio and know socket testing and all these things that need quite a lot of time.

And so I budgeted three days a week for everything to repair and then two days in the office with the idea of increasing those days as we go.

NK: It’s incredible you’re back to work eight months on and last weekend out hiking?!

SDL: Yes I went hiking, I wanted to test my limits. The prosthetic leg that I currently have is very good but I didn’t know what my limit was, and I pushed it to 7,000 steps and I thought, okay, this is still going great. And then we went on the hike and I was at 18,000 steps and I was still fine. I was tired, but I know where my limit is now.

NK: Incredible. And you’ve been fundraising for a bionic arm, tell us about that?

SDL: Yes, that was the idea of my husband and he had spoken to a few people who have had similar injuries and he was asking the financial questions – I didn’t think of that because I was just trying to repair myself and didn’t even think about the next step – and it was a really high price tag. We discovered that a bionic arm costs about £100,000. It’s an incredible piece of tech but it comes at a price. And on top of that, you have all of the physio that goes with it, all of the learning how to use it and that comes as an additional cost.

And so he set up the fundraiser on GoFundMe. I remember telling him we will never get £250,000, that’s mad, if we get the £50,000, it would be a massive win. And he said “trust, trust, trust, the people”… the response was incredible. We managed to get to the goal on the day that I left the amputee rehabilitation unit.

At the moment, I’ve got a mechanical arm that’s function is quite limited, it opens and closes the hook. The idea is that it performs as a training arm. It’s just for me to build up resilience and to train my shoulders to carry the bionic arm, which is very heavy.

NK: What would you say companies need to consider if they are trying to support somebody with physical or mental challenges? What have been the key things that have really helped your return to work?

SDL: For me, it was the dialogue and for me it was the ability to talk to my manager, talk to my colleagues in HR and clearly articulating what I was able to do at that time. And that conversation still is ongoing and being really honest to say “well, that I will have this difficulty”. For example, we explored anything from sitting at a desk, using the computer, how would that work. I’ve been trialling out different keyboards to see what worked best. Typing with one hand is a bit of a challenge so we also explored voice recognition or voice-to-word to see how that speeds up the process. That all works for me.

The difficulty with any disability, visible or invisible, is that they all different. They all have different needs and people have different abilities or boundaries. And so for me, I would say communication is key, and to have that communication, there needs to be trust enough from the employee to be able to talk about it openly. I can see that outside of the industry people are more aware about disabilities, physical, visible, invisible, and you see that there is a lot more thinking around diversity, equity and inclusion, but in a way that showcases it. Tommy Hilfiger, for example, I noticed they. in their advertising, they use people with limb differences. They just brought out a collection of adaptive clothing, which I found interesting.

NK: As we wrap up the interview, is there anything that you want to finish on? What would be your parting message?

SDL: There are always silver linings to what happens. My silver lining is I’m extremely lucky that I’m alive today. I know for a fact that I could have died 10 times that night and, for some reason, I didn’t, and I’m extremely grateful for that. And that is my contribution, hopefully to other people. I’d like to say life has this thing that it could change within seconds, and gratefulness is probably the best way to look at it.

NK: Well, we’re very grateful to have you here today. Thank you so much for sharing your story with us and all of your insights.

SDL: Thank you very much.