A little over three years ago veteran multi-asset manager Trevor Greetham left Fidelity International for Royal London Asset Management (RLAM) but should investors have followed the manager or stuck with the Fidelity team? 
The case for leaving starts with the manager’s process, which involves his proprietary ‘investment clock’ approach.
The premise of the clock is that the economy follows periods of expansion and contraction, overheating then cooling off, with inflation picking up and then falling away after growth slows.
Each of the four phases of the cycle favours a particular asset class, as the below example shows, with current readings based on past trends and the momentum of lead indicators.
Investment clock example
Source: RLAM
Greetham, who had developed this approach during his time at Fidelity, joined RLAM in March 2016 in the newly-created role of head of multi-asset.
Adrian Lowcock, head of personal investing at Willis Owen, said: “Trevor Greetham was a fairly reliable safe pair of hands. He had a clear process and perspective on the world and he followed that consistently throughout.
“As such many of his investors have bought into that process and thinking and it is hard to replicate that once the original founder has left.
“So, in this case I would expect many investors to follow him to Royal London as they want what only Trevor can offer.”
At Fidelity, Greetham was responsible for implementing tactical investment decisions across a wide range of institutional and retail funds including the Fidelity Multi Asset Strategic fund, which was taken over by Kevin O’Nolan and Nick Peters.
However, since then, O’Nolan has been poached by Aviva, which has have been reviewing and improving its asset management proposition for the past few years, according to Lowcock.
“Aviva has been on the hunt for good fund managers and is willing to pay for them as well. Given it is supporting this area it is likely to appeal to many managers wanting a new challenge,” he noted.
Peters continues to work at Fidelity and has a number of fund manager responsibilities both in equity-specific and multi-asset funds either as lead or co-manager.
The eight Fidelity multi asset strategies that Greetham managed are now run by Peters as well as a combination of Ayesha Akbar and Chris Forgan, who joined him in the fourth quarter of 2017, as well as former Janus Henderson multi-asset manager Bill McQuaker.
Taking the most balanced portfolio from the two ranges – Fidelity Multi Asset Growth and Royal London GMAP Growth – the RLAM fund has outperformed his previous portfolio by 4.21 percentage points, since Greetham joined the asset manager.
Performance of funds since Greetham started at RLAM
Source: FE Analytics
And Lowcock said he would continue to back Greetham over the longer term rather than his former portfolios and colleagues at Fidelity.
“He has the experience, performance record and established clear process which he is repeating at Royal London. If you are happy with what he has delivered in the past there is no need to change,” he said.
However, Alex Farlow head of risk-based solutions research at Square Mile Investment Consulting and Research, said that both remain good options for investors.
“Fidelity's process has not changed meaningfully since Trevor Greetham left to Join RLAM. The team still uses business cycle analysis when deciding the asset allocation for the Multi-Asset Strategic fund [for example], which remains the premise for the Investment Clock that Greetham uses at RLAM,” he said.
“However, it is one of a number of data sources and leading indicators used, which to our knowledge, has always been the case.”
Indeed, both ranges are focused around the long-term expectations for asset class returns and on providing capital growth, while neither is driven by peer group asset allocations.
Farlow said: “Both approaches use a variety of data sources to drive the asset allocation, although business cycle signals are more influential within the RLAM process.
“Additionally, RLAM will be more dynamic with their asset allocation changes as the underlying vehicles they use [index funds] are not designed to generate alpha.”
He added: “Fidelity, on the other hand, implements their views through a range of Fidelity managers that have the potential to add alpha at the stock level.”
Meanwhile, the manager changes to the range are also not as troublesome as they might appear from the outside.
“Whilst there have been a number of personnel changes at Fidelity we believe investors continue to benefit from a strong, well-resourced team,” Farlow said.
While O’Nolan no longer run the strategies, new hires including Bill McQuaker and Chris Forgan from Janus Henderson have bolstered the multi asset team, he added.
Farlow said: “The structure of the multi-asset business at Fidelity means there are a set of common ideas and themes which run through the team and the manager implements these in line with the fund's mandate.
“Whilst each manager has discretion regarding the implementation of ideas we do not believe the outcome will be that different from one manager to the next.”