THE people who manage your money are divided into two camps. The first is made up of the conformists who follow mainstream investment strategies, some successfully, some not so. The second camp contains the more maverick managers, whose performance is out of the ordinary, either disastrous or amazing.

Hugh Hendry, manager of the Odey Continental European fund, is one of the awkward squad. This is the man who defied his trade body, the Investment Management Association, and went

50 per cent liquid, taking his fund into cash, when its rules required him to be at least

80 per cent invested in equities at all times.

His argument was that if he thought that we were in for a bear market in European equities from 2000 onwards, what was the point of being fully invested in them? It was a brave call to make, but it paid off.

In the three years to March 2003, Mr Hendry’s fund was the top-performing European fund and the only one of

77 to make any money at all for investors. His performance since then has slumped. Since March 2003 his fund has ranked bottom of the 107 funds in the sector — largely, critics say, because he was not fully invested when the market turned.

His long-term record, however, remains good. Over the past five years his fund has returned 51.8 per cent, putting it second of the 73 in its sector.

Patrick Evershed, of New Star, is another fully paid-up member of the “proud to be different” squad. His New Star Select Opportunities fund contains some unusual stocks for what is basically a UK fund. In 2002, he invested heavily in Chinese power companies that he thought, correctly, would benefit from the country’s dramatic growth.

While running Rathbone Special Situations fund in the late 1990s, Mr Evershed got out of technology shares when others were still aggressively buying. When the property market hit rock bottom in the early 1990s, he was buying shares in estate agents such as Savills. The contrarian approach paid off. In the final five years that Mr Evershed managed the Rathbone fund, it was ranked fifth of the 193 funds in its sector, while his New Star fund is fourth of 294 in its sector since launch in June 2002.

Another investment manager who is not afraid to go against the tide is Ian Rushbrook, who runs the Personal Assets investment trust. In an investment market that is populated largely by cautious optimists, Mr Rushbrook is a genuine 24-carat Cassandra.

He would not be surprised if the stock market collapsed and he puts capital preservation very high on his list of priorities. To this end he has a third of his money in cash and has maintained a large cash position for several years.

Mark Dampier, head of research at Hargreaves Lansdown, the independent financial adviser (IFA), says: “This maverick stance served him well in the bear market, when being heavily in cash was a good call. But since the market turned, he has been overtaken by most of the other trusts which are fully invested.”

In the 12 months to December 31, 2001, Personal Assets ranked 44th out of 228 trusts. But in the most recent 12 months it has slipped to 212th out of 264.

Finally, as proof that simply being a maverick is no guarantee of success, there is the example of Jayesh Manek, the pharmacist from Middlesex who won an investment competition and was headhunted to run the Manek Growth fund. James Calder, of Bestinvest, another IFA, says that the free rein Mr Manek was given has not resulted in thoroughbred performance. His bias towards growth stocks in a period when value stocks were the real winners has left the fund with a sorry track record. Over the past five years, it has lost 63.2 per cent, putting it 224th of the 225 funds in its sector.

Mr Dampier says: “Backing managers who go against the tide can be very successful, but you should brace yourself for a rough ride and accept that sometimes it can end in tears.”