F&C has announced that after a period of time off due to ill health, Ted Scott will return to the firm in June. He will no longer be responsible for funds management but will provide macroeconomic and strategy input to the UK equities team. The move is reminiscent of Bill Mott’s step away from funds management duties to focus on macroeconomics and strategy at Credit Suisse, although Mott has since returned to funds management first at Credit Suisse and now pSigma Asset Management.
The F&C UK equities team will now run the same number of funds as previously, minus one experienced fund manager. F&C has consequently realigned portfolio management duties across the ra
nge.
Hilary Aldridge has been appointed lead manager on the F&C UK Growth & Income fund. She was previously co-manager from 2005 and caretaker of the fund since 2008 in Scott’s absence, however Aldridge will need to adapt given that most of her experience is in small-cap equities.
Lead management on the Stewardship Growth and Stewardship Income funds has been reassigned to Catherine Stanley, F&C’s Head of UK Smaller Companies. This move makes sense as the ethical screens preclude investment in many FTSE 100 companies meaning the Stewardship funds have a mid and small cap bias.
Phil Doel, Director of UK Equities will be lead manager on the F&C UK Equity Income Fund. He has some equity income experience, having run the M&G European Dividend fund until he left M&G in 2001.
Peter Lees, Head of UK Equities will take over as lead manager of the F&C UK Equity fund.
JPM launches Strategic Bond Fund
JPM this week launched their previously announced Strategic Bond fund. The fund will be managed by Bob Michele, JPM’s Global CIO of Fixed Income. Michele previously worked at Schroders and came across to JPM in September 2008 along with Schroders colleagues Lisa Coleman and Steven Lear. Michele will be supported by the global resources of J.P. Morgan Asset Management including their fixed income sector specialist and portfolio management teams. In common with his previous Schroder Strategic Bond fund, the JPM fund will invest in the team’s highest conviction ideas and Michele will have discretion to move flexibly in shifting market conditions regardless of benchmark allocations.
Blackrock announces departure of Alain Bourrier and Emerging Markets reshuffle
Blackrock has appointed Plamen Monovski as Head of their Global Emerging Markets team. Alain Bourrier has left Blackrock after 11 years with the firm, and will be taking a career break.
After the reshuffle, the team will have three specialists based on London: Sam Vecht has been named co-manager of the BGF Emerging Europe fund while Dhiren Shah and Daniel Tubbs will join Plamen Monovski as co-Managers of the BGF Emerging Markets and BFM Emerging Markets funds. Meanwhile Will Landers (based in Princeton, USA) will continue to provide input to the Latin American portion of the global emerging market portfolios and manage the BSF Latin American Opportunities fund. Morningstar is scheduled to meet with Blackrock in the near future and will discuss the team changes.
Gartmore appoints Kam Tugnait as Head of High Yield
Gartmore has continued with an overhaul of its fixed income team with the recruitment of Kam Tugnait as Head of High Yield. This follows the recent appointment of John Anderson as Head of Credit, who managed the Rensburg Corporate Bond Trust from 2000 until 2009. Gartmore’s fixed income funds experienced a period of poor performance through the credit crunch with some poor stock selection and unfortunate positions in credit default swaps which didn’t work as expected. Meanwhile John Anderson’s fund performed relatively well, and Gartmore appears to be committed to rejuvenating its fixed income offerings with these high profile hires.
Smith & Williamson launches “one-of-a-kind” Short Dated Corporate Bond fund
Smith & Williamson has launched a Short Dated Corporate Bond fund which they tout as the only fund of its kind. It will invest in corporate bonds of less than six years maturity and the fund will be marketed to investors wanting a higher yield than cash. The fund will be managed by Ian Kenny, a member of the Smith & Williamson’s Fixed Interest team led by Chris Lynas.
Threadneedle launches Credit Opportunities fund
Threadneedle has expanded its Absolute Return range with the launch of the Threadneedle Credit Opportunities fund, to be managed by Head of High Yield, Barrie Whitman. He will also work closely with high yield fund manager Roman Gaiser, and investment grade credit fund manager Alasdair Ross. The launch is initially for the UK, followed by Europe in the coming months. The fund takes an absolute return approach, aiming to beat the 1-month Euro Deposit Rate by 3.5% per annum (gross of fees and charges). They aim to achieve this objective by taking advantage of valuations in credit markets which they have identified as cheap. While such targets are oft stated for marketing purposes, whether a fund can deliver or not is another matter entirely and fees can seriously erode returns. We draw investors’ attention to UBS Absolute Return Bond, which said at launch in 2005 that it targeted a return of 2.15% over the base rate with low volatility. That fund lost 30.8% in 2008 after falling 7% in 2007, and had a maximum drawdown of 40%. The Threadneedle offering may or may not fare much better, but stated targets should not be taken as much more than wishful thinking in our view.
Morningstar qualitative ratings and reports issued this week
Morningstar issued new qualitative ratings and reports on a number of funds available to UK investors this week, including Investec Cautious Managed and JOHCM UK Growth. Click here to see the full list.
