Algy's Investment Podcast Freddie Lait: Fund Manager Sold His House to Start £1 Billion Fund | The Risk That Paid Off | #21
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Dec 8, 2025 Freddie Lait, founder and CIO of Latitude Investment Management, made a bold move by selling his house to launch a £1 billion fund. He shares insights on his disciplined investment philosophy focusing on earnings growth and dividends. Freddie discusses the importance of patience in investing and contrasts portfolio management with stock analysis. He emphasizes a free cash flow yield strategy and his 30-year vision for the fund, while also highlighting the impact of AI on select stocks. His thoughts on risk management and sector preferences provide a fascinating glimpse into his investment approach.
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Prefer Free Cash Flow Over EBITDA
- Prefer free cash flow over EBITDA because FCF reflects real cash after capex and working capital.
- Use earnings and cash flow to check what companies truly invest and return to shareholders.
Defensive Sectors House Preferred Businesses
- Latitude tends to favour defensive sectors because the companies fitting their model often live there.
- They do not permanently avoid sectors but exclude many poor quality companies quickly.
Be Wary Of Tech Valuations With Rising Capex
- Avoid tech when margins and capital needs make future cash flows uncertain relative to price.
- Be wary when AI capex pushes free cash yields far below earnings yields in big tech.
