You manage the two five-star rated funds in addition to GAMerica and a US mutual fund. Do you have a consistent investment strategy for these funds?

It is largely bottom up. Occasionally I felt something like gas stocks [shares] were cheap. Then I would make that decision and look at stocks to buy. Generally speaking I do it the other way round. I don’t think there is much value in predicting what the market is going to do generally speaking.

How many investments do you hold in your funds?

Normally if the fund has been running for any length of time about ten stocks represent half of the fund, the next ten represent about a quarter, and I might have 20-25 other stocks.

Do you have any favourite shares or sectors?

There are sectors I am interested in, such as retail because I think if you get retail right you can make as much money as you can in technology stocks. I think any one of us can feel whether a retail store has a buzz or not. Whereas if you go into a factory which makes parts I have no idea whether it is a good part factory or a bad one.

What is the retail market like at the moment in the US?

Department stores it seems to me are largely selling off their discount racks now. It is a sort of phenomenon that is developed. Of course it tends to damage people’s belief in pricing. You often see people gathering around the discount racks rather than anywhere else.

I think some retailers have sort of lost their way. I went into a Sak’s in Chicago last year and the telephone was ringing when I walked in and it was still ringing when I walked out. They were building displays in the middle of the day. That is missing the point of a luxury retailer.

Do you also look at some of the discount shops?

Yes, I have done very well with Best Buy [a home electronics retailer] and I have done quite well with United Automobile Group, a big car dealer.

Have you noticed any trends of customers moving to the out of town discount centres rather than the higher priced, more central shopping malls?

Department stores are becoming a smaller and smaller part of American retailing. The Gap was doing incredibly well but it has lost its way. They cut out a lot of the basic stuff they used to sell which people walked into the Gap knowing it would be there.

What is your view on the accounting situation in the States?

I have been worried about accounting standards for a long time. I certainly had no idea you were going to have these huge failures but it is sort of one thing after the other. You have Merck now with problems and most outsiders wouldn’t have thought Merck would get up to anything funny.

What is the turnover of your funds?

It is very low. I used to be a stockbroker so I always thought turnover benefits the stockbrokers rather than the customers.

Do you think the strong performances of your funds is down to sector choice?

It is a job where I think you get better at it as you go along. Except in raging bull markets where I would never do very well because I would never let my cynicism allow me to buy rubbish which is usually the thing you can do very well with in a raging bull market. Obviously sometimes I am going to buy it not knowing it is.

I never had a big position in tech because I never understood it really. The other thing I think people forget is that Sam Walton made a bigger fortune than Bill Gates.

Do retailers successful in one country move easily to others?

Generally speaking people have had terribly little success in moving retail concepts from country to country. Hennes have done it but they come from Sweden, a relatively small retail market.

When visiting the States do you visit the shop as well as management?

Yes, frequently I’ll hire a car and drive around and pull in and look at shops. Best Buy has been a real winner for me. As an example, I walked into Circuit City [a consumer electronics retailer] which I never liked because it had a bait and switch technique. They would advertise something very cheaply and someone would grab you as you walked in the door and persuade you to buy something else.

They’ve stopped doing that so much now but there was battery in there that I needed for a phone which was $27 (£17). It seemed to me a lot so I walked across the road to Wal-Mart where it was $14. That made me doubt the pricing of anything [Circuit City] had.