Fund Times: 22 - 26 June
FSA to ban commissions; Stewart Cowley to manage OMAM strategic bond funds; Gartmore appoints new UK Portfolio Manager; Investec Asset Management announces a new credit hire.
The FSA issued a long-awaited consultation paper on its retail distribution review, or RDR, yesterday. The paper proposes sweeping changes to the definition of independent advice and the way advisers are compensated for their services including a ban on commissions paid by fund companies. While such transitions are never easy, we think the document represents a clear step in the right direction, and that any interim pain it may cause to advisers will be more than compensated for in the long-term by the elimination of conflicts of interest and the provision of higher quality advice to investors. However, we note several ambiguities in the paper that may weaken the thrust of the commission ban. We will publish an article on the topic next week. The FSA's consultation paper (CP 09/18) is available here.
Stewart Cowley to manage OMAM strategic bond funds
Old Mutual Asset Managers (OMAM) has announced this week that Stewart Cowley, their new head of fixed income, will be taking over as manager of the Old Mutual Global Strategic Bond Fund and the Old Mutual Dynamic Bond Fund. Cowley is well known in the industry as the former head of fixed income at Newton Investment Management. There he also managed the Newton International Bond Fund and the Mellon Global Bond fund (offshore).
We think Cowley’s presence on these offerings is a positive change. The funds have struggled in the past, and his wealth of experience should help turn them around. At the same time, we are relieved to see that OMAM’s Stephen Snowden is retaining control of the Old Mutual Corporate Bond Fund. Cowley and Snowden have very different investing styles, with Cowley focusing on the big picture thematic approach that is characteristic of Newton, while Snowden is very bottom up, deal focused. Snowden will be reporting to Cowley in this structure, and we believe there is potential for them to work well together and be complementary in their approaches, which could benefit the fixed income team at OMAM. However, it remains to be seen how the actual dynamics of their working together will pan out.
Gartmore appoints new UK Portfolio Manager
Gartmore has announced the hire of a new UK Portfolio Manager, Luke Newman, who will start on the 29th of June. Newman will work on the fairly new Gartmore UK Absolute Return and the unfortunately named AlphaGen Octanis Funds, together with current manager Ben Wallace.
Newman has nine years of relevant industry experience, including roles at Deutsche Asset Management (where he managed UK equity long only and long short funds), Foreign and Colonial and Altima Partners.
Investec Asset Management announces a new credit hire
Investec Asset Management has announced the hire of Jeff Burch as the new co-head of its credit team. This is part of Investec’s broader fixed income team which is co-headed by John Stopford. Burch previously had responsibility for the European, Asian and African credit exposure at Blue Mountain Capital, a specialist credit hedge fund. There he was also responsible for all European Credit operations. Additional previous experience includes roles at Bank of America, Morgan Stanley and Chase Securities. He will manage the Investec Global Credit Opportunities Fund as well as look after the day to day management of the specialist credit team.
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 Fidelity UK Growth and Gartmore Cautious Managed. Click here to see the full list.
