Hedge fund firm Lansdowne Partners has identified a “mis-pricing” in retail bank stocks as one of its investment themes for the year ahead. The sector was the biggest contributor to its flagship UK fund’s first annual loss in a decade.

Pete Davies and Stuart Roden, portfolio managers for the Lansdowne UK Fund, revealed in their latest newsletter to investors that the fund lost 20.07% in 2011. This was its first yearly loss since launching 10 years ago.