City titan Lord Spencer is donating his £20,000 winnings to charity

Lord Spencer donates £20,000 to the Royal Osteoporosis Society after winning a bet against his arch-rival, renowned fund manager Terry Smith.

Michael Spencer is the man who built the Nex Group, formerly ICAP, from the ground up and turned it into one of the world’s largest inter-dealer brokers.

He is making the donation after promising a year ago that he would hand over the money to a charity supported by The Mail on Sunday if his Nutshell Growth Fund outperformed Smith’s flagship Fundsmith Equity fund by 2024 .

He said the Nutshell fund, led by Mark Ellis, did even better than he had hoped. Founded in 2019, Nutshell Asset Management uses an in-house developed model that combines artificial intelligence (AI) with human judgment.

Spencer increased his stake in operating company Nutshell Asset Management from 25 percent to just over 40 percent earlier this year and took on the role of chairman last month.

He is also a major investor in the £69m Growth Fund itself, having invested £20m during the year in addition to significant equity investments in the management company and other strategic commitments, totaling £60m.

In the summer, the fund’s total fees for the cheapest share class were reduced from 1.55 to 0.85 percent. Small investors can put in lump sums from £100, or £25 for regular monthly savings.

“It’s designed for everyone, not just the big boys,” Spencer added.

The Nutshell fund has returned 23.8 percent so far this year, compared to 10.7 percent at Fundsmith at the end of November. Since launch, the return has been 160 percent.

Terry Smith is a hugely successful fund manager thanks to his strategy of backing growth stocks. He now lives in Mauritius.

Fundsmith has been an excellent long-term performer with a 619 percent return since its inception in 2010.

The return was 12.4 percent in 2023, compared to Nutshell’s 26.47 percent.

In 2022, which was a tough year for the markets, Fundsmith came out better, with a loss of 13.8 percent compared to Nutshell’s loss of 19.16 percent.

Spencer, a former Conservative Party treasurer, also described Keir Starmer’s Labor government as “by a significant margin the most socialist government this country has ever had.”

He is “very pessimistic” about Labour’s economic policies and says he believes the government has “no hope of generating the economic growth it has talked about”.

“I predict that economic growth in Britain – per capita – will remain at ridiculous levels and that is a very sad prospect,” he said. ‘Unfortunately there is no reason for hope under Starmer and Chancellor Rachel Reeves.’

He called on ministers to abolish stamp duty on share trading to revive the city.

“The UK is the only major market in the world where we still have stamp duty, and share turnover is lower today than it was 20 years ago,” he said.

He also lashed out at the current cryptocurrency craze, saying, “We would never invest in bitcoin. It doesn’t pay dividends and never will.

“At some point, I have no idea when, the bubble will burst.”

This newspaper has campaigned with the Royal Osteoporosis Society to roll out diagnostic services for the debilitating bone disease across Britain.

Spencer said: ‘The Mail on Sunday osteoporosis campaign is very persuasive, very powerful and a great idea.’