JO Hambro’s Alex Savvides, Investec’s Blake Hutchins and Schroders’ James Sym have been named as some of the most promising young investment stars by a number of the industry’s best-known fund pickers.
“We’re always trying to find the good new [managers],” he explained. “We bought Hugh Yarrow and Ben Peters’ Evenlode Income about three years ago, it was a £50m fund at the time, it now has £1bn in it.
“We think that team will be good to go for multiple years. We hope we have somebody who is the same calibre as Anthony Bolton or Neil Woodford, but in their thirties.”
As such, FE Trustnet decided to ask other multi-managers who they are backing for long and illustrious careers within asset management. Their answers are in the below article:
John Husselbee: Blake Hutchins
Husselbee, who is head of multi-asset at Liontrust Asset Management, said the consistency of a manager’s investment process is the most important factor to consider when selecting a fund.
Given that the investment process needs to be monitored over a long period of time, he said that this can handicap younger managers to some extent.
“My preference is to back experience when we’re selecting managers but that doesn’t stop us looking at some of the new talent that is popping up,” he said.
“With that caveat in mind, the one I would probably suggest is Blake Hutchins, who runs the Investec UK Equity Income fund.”
Launched in February 2015, Hutchins’ fund aims to provide both income and growth. Its top 10 holdings account for 41.3 per cent of the overall portfolio and he is unafraid to take significant positions in individual holdings. The fund’s largest stock, British American Tobacco, accounts for 6.4 per cent of the portfolio.
Since launch, it has returned 21.16 per cent compared to its average peer and FTSE All Share benchmark’s respective returns of 18.14 and 19.25 per cent.
Performance of fund vs sector and benchmark since launch
Source: FE Analytics
“What attracts me to Blake is his pedigree training and apprenticeship. He started with Aviva Investors and there he worked alongside the likes of Dan Roberts and Richard Colwell,” Husselbee explained.
“Then, he moved onto Threadneedle where he not only worked with Simon Brazier, but also came into contact with Leigh Harrison, who was once again well-connected in terms of running an income mandate.
“From Threadneedle, Blake then moved with Simon Brazier to Investec and, at Investec, they set up this fund within the last three years in order to build his track record.”
The head of multi-asset said he is always interested in the background of fund managers and reasoned that Hutchins’ experience working with household names within the UK equity income space is advantageous.
“From that, he obviously has some ideas on what works and what perhaps doesn’t work within equity markets when running for income,” he added.
Simon Evan-Cook: Dominic St George
Evan-Cook, who is senior investment manager at Premier Multi-Asset, likes investing with younger investors as well as older managers.
He said it pays to have a mix in this respect, pointing out that there’s an “artistic side” to investing, whereby young managers can ably compensate for their lack of experience with imagination and openness that may otherwise have been chipped away over time.
“One investment house that leads in this respect (as it does in so many areas) is Stewart Investors,” he said. “They appreciate that while there is much to be gained from their plethora of wise old heads, there are also benefits to giving younger managers a meaningful chance.”
Evan-Cook said Dominic St George, who co-manages their Latin America fund, is a prime example of this.
He has co-managed the five crown-rated Stewart Investors Latin America fund since July 2015, joining fellow manager Tom Prew who took to its helm in 2013.
The £181m fund has a concentrated portfolio of 38 holdings which are chosen with a distinct quality bias.
Over St George’s tenure, it has returned 47.05 per cent compared to its MSCI Emerging Markets Latin America benchmark’s return of 28.61 per cent.
Performance of fund vs sector and benchmark under St George
Source: FE Analytics
“He is cut from the same cloth as Stewart Investors’ highly successful Angus Tulloch, but he has one key advantage that Angus wouldn’t have had when he was starting out: Angus himself,” Evan-Cook said.
“Dominic has been tutored and guided by Angus, as well as many of their other experienced investors. In addition, although Angus is due to retire soon, he continues to have the support of the wider Stewart team.
“This more than makes up for any shortage Dominic may have in terms of years on the clock, and allows the fund to benefit from the fresh perspective a younger manager can bring.”
Yeowart, who manages the five crown-rated Troy Spectrum fund, often allocates capital to more experienced managers with well-established and successful performance track records spanning over numerous cycles.
However, he said it is important to invest alongside younger ‘emerging’ fund managers who have the talent and ability to emulate their peers. Yeowart pointed out that many of these managers also run smaller, more nimble funds with greater flexibility to outperform in the future.
“One young fund manager currently on our radar is James Zimmerman, manager of Jupiter UK Smaller Companies,” he said. “He has a short but impressive performance track record. More importantly, he is hard working, capable and passionate about investing.
“He is also intellectually honest, willing to challenge his own assumptions and learn from mistakes. These are attributes we value and which we believe engender long-term success.”
Since Zimmerman became manager of Jupiter UK Smaller Companies in June 2015, it has outperformed its benchmark and average peer by 22.93 and 16.56 percentage points respectively with a total return of 45.78 per cent.
He aims to achieve long-term growth through a portfolio which currently stands at 55 holdings. Its largest individual weightings include concrete placing equipment manufacturer Somero Enterprises, Ocado and software company Quixant.
Ben Willis: James Sym
Willis, who is head of research at Whitechurch Securities, said James Sym is perhaps not that well known but is a manager to watch. Whitechurch currently invests in his European Alpha Income fund, which has five FE crowns and was launched in May 2012.
“[Sym] cut his teeth in fund management at Cazenove, working alongside Chris Rice and was appointed co-manager of the European fund in November 2012,” he explained.
“He became sole manager after Chris Rice left following the merger between Schroder and Cazenove and continued to run the fund under its new Schroder guise. In recognition of his potential, he was appointed lead manager of one of Schroder’s existing funds, European Alpha Plus a couple of years later.”
Willis explained that, as per all ex-Cazenove managers, Sym follows a business cycle approach to investing although his overall approach is value-orientated. As such, he said the manager tends to hold contrarian views and there have consequently been periods when his investing style has been out of favour.
Since launch, though, the £942m fund has outperformed its sector average by 52.65 percentage points and its benchmark by 48.34 percentage points with a total return of 154.8 per cent.
Performance of fund vs sector and benchmark since launch
Source: FE Analytics
“His approach to investing in European equities is well-placed to benefit from any domestic recovery in the Eurozone going forwards,” Willis added. “We believe that over time he will establish a strong long-term track record.”
Darius McDermott: Alex Savvides
McDermott, who has recently launched a range of four VT Chelsea Managed funds, said JOHCM’s Alex Savvides is set to do particularly well over the long term.
“We are big fans of Alex Savvides who runs the Jo Hambro UK Dynamic fund. He runs a solid yield and valuation based process and his fund has an excellent track record of outperformance,” he said.
“He does particularly well in value markets and is a good long term fund for core UK exposure.”
Since the FE Alpha Manager launched the four crown-rated fund in 2008, it has doubled the performance of its FTSE All Share benchmark with a total return of 186.84 per cent.
Savvides adopts a bottom-up process to stock selection, which focuses on companies that are out of favour. They must also be dynamic, employ strict investment discipline, offer a margin of safety and able to profit from extremes.
Examples of his largest holdings in the £540m fund include BP, Shell, GSK and Aviva. The fund currently has a portfolio of 44 stocks.