M&G's Woolnough on risk-reward, being an all-rounder and fund manager pay

Manager of £15.5bn bond fund

In an extract from Intelligent Investors, Richard Woolnough, manager of M&G's £15.5bn Optimal Income, Corporate Bond and Strategic Bond funds, talks about the importance of active management when it comes to running billions of pounds, and why he always prefers to stick to the 'letter of the law' when investing.

How do you arrive at the balance between understanding the macro, and thinking through the consequences to make better investment decisions? You start by developing a micro view and work up from there and think about a sector. There are times the two do coincide, so you have a macro view that coincides with a sector view, so it works in both directions. I am very much an all-rounder, and I will take every bit of information I can to construct my portfolio. You cannot have a set style; it has to change as the economic environment changes. For example, if you go skiing and you say to you...