Neil Woodford has concentrated his play on tobacco stocks after selling out of one holding and increasing his exposure to two other companies.
The manager now has just under 13.6 per cent in two tobacco holdings - Imperial Tobacco and British American Tobacco - after selling out of Philip Morris International.
The manager said the move was down to the fact the UK-listed companies looked “increasingly attractive to us in valuation terms”.
The shares in both Imperial and British American have fallen slightly since the back end of November, a move likely to have tempted the manager to increase his weighting in the companies which are now the second and third largest holdings in the portfolio.
Elsewhere, Mr Woodford said his relative performance had been helped by the lack of exposure to oil and gas and reemphasises his concerns about the sector.
“We remain concerned that the UK oil majors, BP and Royal Dutch Shell, are over-distributing and their dividends are at risk,” he said.
“Their yields are high but unsustainable, in our view, and the falling oil price simply reinforces our long-held view that there are better opportunities to be found elsewhere.”
Mr Woodford also used share price weakness in service company Capita and energy company Centrica to add to his holdings in those businesses.
He added he remained “confident in the long term investment case” of Royal Mail, in spite of the company’s shares weakening after its interim results highlighted “the challenging competitive environment” it faces.
The manager added to a new position in Breedon Aggregates in November as well as three unquoted companies.
These were Cell Medica, which develops, manufactures and markets patient-specific cellular immunotherapy products; Genomics, which is a healthcare spin-out from Oxford University and energy efficient toilet company Propelair.
