Terry Smith: “The problem is most people don’t read the accounts”

Terry Smith, founder and chief executive of Fundsmith, has built the UK’s largest actively-managed fund via rigorous implementation of the simple mantra 'buy good companies, don’t overpay, do nothing'.

In this interview, Smith tells Mary McDougall how he analyses and selects companies, how the rise of software has folded into his investment thinking and what trends he thinks currently look most promising.

He also talks about the extent to which fund size is a challenge going forward, and what spurred him to buy Amazon (US:AMZN) this summer.

Fundsmith Equity Fund has delivered an annualised total return of 18.4 per cent since its inception in November 2010, compared with 12.8 per cent for its benchmark MSCI World Index. It had assets under management of £27.9bn on 30 November 2021.

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