SECRET Dealings exposes trading that usually escapes attention. Any trade exceeding three per cent of a company’s value must be declared, but huge amounts of buying and selling went unreported untilnow because dealings were below the threshold.

AS the manager of the Artemis Smaller Companies fund, John Dodd has developed a reputation as a fine stock picker, and with his new fund, Piccadilly Growth, he has license to invest where he pleases.

And he has decided that model railway and Scalextric manufacturer Hornby has all the right qualities.

Hornby has risen from a low of 118p in 2000 to a peak of 803p this year and Dodd seems to have bought around this level, though at the close on Friday the shares were 766p.

Piccadilly bought 50,000 between the end of June and early July, building up a 0.68 per cent stake in the 56.2 million company.

Dodd took over Piccadilly in May after underperforming under maverick Max King. The strategy is to use the best thinking from Artemis to invest in international stocks, bonds, cash, unquoted companies, hedge funds and derivatives.

That Dodd chose Hornby as part of this project suggests that he expects it to continue to outperform.

Other shrewd speculators in Hornby include private investor Martin Hughes, former head of equity research at investment bank Credit Lyonnais Laing, and Peter Wood, founder of insurer Direct Line.

Top-performing investment boutique Marathon Asset Management and its founder Jeremy Hosking also have stakes. Together, these investors own nearly 30 per cent.

Hosking, Hughes and Wood have all sold shares this year, but given their gains, this is to be expected.

Profits are forecast to continue rising ten per cent this year and next and on a price-to-earnings ratio of 14.2 times, Hornby does not look overvalued. It has done well from its Harry Potter Hogwarts train and hopes to repeat the success with its Simpsons’ micro-Scalextric.

Source: CITYWIRE.CO.UK 2006.