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Kaye exits Fidelity, GLG fund rebrand and OMGI closes fund: Your fund news digest

23 August 2015

The past week has seen Fidelity lose the manager of its American fund and Old Mutual Global Investors plan the launch of a new fund for its global equity team.

Despite the quiet summer period the last week has seen the usual batch of fund launches, closures and managers moves, so to round up the past few days’ events we’ve summarised the biggest stories below.

 

Peter Kaye leaves Fidelity

Fund manager Peter Kaye is to depart Fidelity after less than three years at the group, handing over management of the Fidelity American fund to Aditya Khowala.

Kaye joined Fidelity in early 2013 to take over the portfolio from the departing Aris Vatis. Over this time the fund has underperformed the IA North America’s average return and the gain in the S&P 500, posting a 38.41 per cent return.

Performance of fund vs sector and index over manager tenure

 

Source: FE Analytics

Khowala will take over the fund on 1 September. He is currently manager of the offshore FF American Growth fund and will implement the same investment strategy on the onshore Fidelity American fund.

A statement from the group said: “Aditya is a long standing member of our investment team. He started his Fidelity career in 2006 as analyst, proved himself as a talented investor and gradually rose through the ranks as a result. He has been managing the American Growth SICAV since December 2012 and the FAST US Fund since June 2014.”

“In making these changes, we have been able to draw upon one of the largest and best-resourced buy-side US equity teams outside the US – composed of four dedicated portfolio managers supported by 17 analysts.”

 

Former Neptune UK equity head joins Columbia Threadneedle

Columbia Threadneedle Investments has appointed Jeremy Smith as head of UK research, a newly created role.

Smith, who joins from Liberum Capital and has 23 years of experience including time as head of UK equities at Neptune Investment Management, will lead the asset management firm’s UK research team and further develop its UK equity research capabilities

Leigh Harrison, head of equities at Columbia Threadneedle, said: “Jeremy’s appointment comes at a fantastic time.  We have been experiencing great success across the product range, with our UK and European funds AUM at record highs this year and the UK Absolute Alpha fund reaching £500m this month.”

“Active management and insight are a key part of our ability to deliver successful outcomes for our clients and Jeremy’s strong track record and extensive experience will further enhance our client proposition.”


 

Smith will report to Harrison in his new role and will be based in London. His appointment follows a number of recent hires, including Mark Nicholls joining the European equity team and Phil Macartney and Sonal Sagar joining the UK equity team.

 

OMGI closes global income fund

Old Mutual Global Investors (OMGI) plans to close its onshore Global Equity Income fund, which managed by O'Shaughnessy Asset Management on a sub-advised basis, and open a new offshore product.

The fund has seen its assets dwindle in size over recent years and the group intends to close the £38.8m fund on 15 September, subject to regulatory approval. Since O'Shaughnessy took over the fund, it has returned 2.90 per cent and underperformed the IA Global Income sector and MSCI AC World index.

Performance of fund vs sector and index over manager tenure

 

Source: FE Analytics

But the firm will also launch an offshore Old Mutual Global Equity Income fund, which will be managed by Ian Heslop, Amadeo Alentorn and Mike Servent of its global equity team. It will target a total return through a combination of income and capital growth, with a monthly income targeted at 30 per cent above that of its MSCI AC World benchmark.

OMGI managing director Warren Tonkinson said: “We’ve experienced a high level of client demand for an offshore global equity income fund managed by Ian Heslop and his team. We are delighted that this fund is now live and will become a core part of our global fund range, available to both UK and offshore investors.”

“We believe our decision to close the onshore Old Mutual Global Equity Income fund is in the best interest of investors. Clients have been informed of our decision to close this fund and of the options available to them. We would like to thank O’Shaughnessy for their management of the fund.”

 

GLG funds rebranded

Man GLG has rebranded its UK-domiciled fund range to harmonise it with Man Group’s global branding convention.

The 12-strong range includes funds such as GLG Japan CoreAlpha, GLG UK Income and GLG Undervalued Assets. From 18 August, Man GLG has been included in their names.

In addition, the group’s Dublin-domiciled fund range will adopt the ‘Man GLG’ prefix in September, subject to regulatory approval.


 

Richard Phillips, head of UK retail at Man Group, says: “Transitioning the funds to the Man GLG brand is a natural progression for the business and will bring our highly successful UK and Dublin ranges into line with the naming convention applied to Man Group’s other investment managers.”

“Among other advantages, the rebrand will ensure complete consistency across the group and allow us to promote the funds in a way that best reflects the ownership of the business.”

 

Fed’s minutes lack clear signal on rate hike timing

Markets were rattled last week after the minutes of the last Federal Reserve monetary policy meeting failed to offer any clarity on whether the central bank would lift interest rates in September.

The minutes, which cover the 28-29 July meeting, reveal that the Fed’s officials believe the conditions needed for a rate increase are “approaching” but concerns over inflation and China prevent there being a clear-cut case at the moment.

“Most judged that the conditions for policy firming had not yet been achieved, but they noted that conditions were approaching that point. Participants observed that the labour market had improved notably since early this year, but many saw scope for some further improvement,” the minutes said.

“Many participants indicated that their outlook for sustained economic growth and further improvement in labour markets was key in supporting their expectation that inflation would move up to the committee's 2 per cent objective, and that they would be looking for evidence that the economic outlook was evolving as they anticipated.”

Only one member of the bank’s Federal Open Market Committee voted for a rate rise at the meeting.

Mark Holman, chief executive of TwentyFour Asset Management, said: “Having commented recently that our view was just about in favour of a September lift-off for US rates, we are now inclined to change our minds and push the first hike date slightly further down the road.”

“The rationale for this was in the FOMC minutes that were released yesterday. Whilst they did acknowledge that economic conditions “were approaching that point” where a rise in borrowing costs could be sustained, there were enough caveats to make us think that September was most likely off the cards.”

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