Taking a contrarian approach to investment can deliver strong returns for investors over the long term, according to Jupiter's Ben Whitmore.

Ben, who has 15 years' experience as a fund manager, joined Jupiter in October 2006 to take over management of the Jupiter UK Special Situations Fund and to manage institutional mandates.

Ben's investment style is to go against the tide and invest in out of favour and lowly-priced shares of companies which are nonetheless well-run and that have sound balance sheets on the basis that any weakness is only temporary. It is an approach that requires discipline and that may result in short term periods of underperformance as it can take time for the market to recognise valuation anomalies.

Since taking over the Fund at the end of October 2006, Ben has produced a positive return of 4.48% versus -9.47% for the IMA UK All Companies sector average. This places the Fund 21st out of 284 funds in the sector. Over one year, the Fund has returned 27.87% against 30.85% for the sector average.*

Ben, who is an advocate of behavioural finance, explains: "As a contrarian I need to be objective and go against typical human emotions. So, when the market has been performing strongly, one has to be pessimistic and when everyone else is gloomy, you need to ignore the headlines and go the other way.

"When I took over the Fund three years ago, risk-taking and leverage were in vogue. Furthermore, not only were valuations high but there was very little variation in the companies' valuations, regardless of their strengths or weaknesses. This lack of valuation dispersion is always a dangerous time and as a result, I avoided risk and focused on investing in solid companies with cash on their balance sheets.

"However, by October 2008, there had been a clear change in the market and the dispersion of valuation was at its highest point for 40 years - higher even than at the peak of the dotcom bubble. At that point, I shifted the portfolio out of steady companies such as Centrica, National Grid and Reed Elsevier and bought into lowly-valued stocks such as Barclays, Invensys, Logica, Next and Rentokil.

"This was a difficult position in the short term as equities continued to fall into 2009 and at its low point, the FTSE All Share went to a P/E of 14 times its 10 year average earnings, below its long run average of 16 times. Now the valuation gap has narrowed there is no longer a strong argument between value and growth stocks in terms of dispersion of valuations.

"Human nature suggests there is a chance of a correction in the short term as good profits have been made. However, I am not spending time worrying about this - there are still plenty of opportunities compared with three years ago and so I am focusing on investing in good quality companies on low valuations such as Tate and Lyle, William Hill and QinetiQ."

- ENDS -

Notes to editors:

* Source: Financial Express to 31.10.09. Bid to bid, net income reinvested.

FUND FACTS

JUPITER UK SPECIAL SITUATIONS FUND
. UK authorised unit trust
. Launch date: 3 June 1996
. Sector: IMA UK All Companies
. Managed by Ben Whitmore
. Benchmarked against the FTSE All Share
. Fees: Initial fee - 5.25%, annual management fee - 1.5%.
. Minimum investment: £500 for lump sum investments and £50 a month for regular savers

Year on Year % Growth ending 30.09.2009

Past performance should not be seen as a guide to future performance.

All performance in this factsheet is based on income units in GBP.

Source: Financial Express, bid to bid net income reinvested, as at 30.09.2009.

NOTE

Jupiter Unit Trust Managers Limited (JUTM) and Jupiter Asset Management Limited (JAM) are both authorised and regulated by the Financial Services Authority and their registered address is 1 Grosvenor Place London SW1X 7JJ. They are both subsidiaries of Jupiter Investment Management Group Limited and the group is collectively known as "Jupiter". The above commentary represents the views of the Fund Manager at the time of preparation and may be subject to change and this is particularly likely during periods of rapidly changing market circumstances. Their views are not necessarily those of Jupiter and should not be interpreted as investment advice. Every effort is made to ensure the accuracy of any information provided but no assurances or warranties are given. Past Performance should not be seen as a guide to future returns, the value of an investment and the income from it can fall as well as rise.