Citywire ratings: 13 managers to bolt out of the gates in 2013
Jonathan Gumpel/Robin Eggar
Brooks MacDonald co-managers
Jonathan Gumpel and Robin Eggar have moved up one notch to reach the highest accolade of an AAA. The duo first made its appearance in the ratings in October 2012 when they received an AA for their performance on the IFSL Brooks Macdonald Defensive Capital fund. Since then they have steadily risen in the ratings scale and produced better risk adjusted returns month on month and the fund has risen by 14.9% over the last three years.
It invests mainly in defensive assets such as preference shares, loan notes, convertibles, structured notes and other defined return investments.
Global bond manager
Stuart Edwards enters with his first rating, an A. He manages the Invesco Perpetual Global Bond fund. Over the past 35 months, the period for which he has received his rating, he has generated returns of 15.82%.
As the trend for outperformance for lower credit quality assets in comparison to the wider bond market continues, Edwards's portfolio benefits. The fund is invested mainly in government bonds and has a structural bias towards those issued by the US and Germany. After strong returns in these regions he now has a focus on the Canadian, Australian and European sovereign markets.
Edwards has a small position in investment grade bonds which are mainly within senior bank debt which has been made more attractive to him by the introduction of the Basel III guidelines on the regulatory framework for banks.
At the end of November, top bond issuers held were US Treasury (13.9%) and the Federal Republic of Germany (5.03%).
UK equities manager
Stephen Anness enters for the first time with an A rating for his three-year risk adjusted performance on the Invesco Perpetual UK Aggressive fund. Over this time the fund has risen 32.83%, in comparison to his benchmark, the FTSE All-Share, which rose 24.15%.
Over the past few months, his main sector investments have been within industrials and consumer services sector which together make up more than 50% of his portfolio. His main stocks at the beginning of the last quarter were the AIM listed company, Rentokil Initial (9.53%) and Dixons Retail (6.08%).
For 2013 he remains cautious and sees the UK equities market remaining volatile due to economic prospects in the Eurozone.
Ruth Keattch/ Derek Stuart
Co-managers of the
Artemis UK Special Situations fund, Ruth Keattch and Derek Stuart both enter the ratings this month with an A for their performance. This is the first time Keattch has received a rating, while Stuart has regained his after a 16-month absence. Over the last three years they have posted returns of 29.49% within the fund.
At the end of November the main sector investments were in industrial goods and services (18.7%) and the oil and gas sector (14.8%). The main detractors to performance were HSBC and Vodafone.
Nick Hayes enters with his first Citywire rating, gaining an A for his 30-month risk adjusted performance on the AXA Sterling Strategic Bond fund and has generated returns of 23.85% in the fund over this time. The strategic bond gives him a wide remit of investments within the bond sector of which investments he can hold within his portfolio and at the end of December all his top 10 holdings comprised of UK treasury investments. Overall he has more than 35% invested in UK corporate bonds and more than 50% invested in UK government bonds.
On his positioning for this year, he retains his reduced exposure to duration and is also looking to reduce some exposure to some of the corporate bonds which are on more stretched valuations.
Invesco Perpetual manager
Ciaran Mallon gains his first AAA rating this month on the back of his performance on the Invesco Perpetual Income Growth fund. Over three years the fund has risen 34.76% compared to the FTSE 350 Higher Yield index, which rose by 21.26% over the same period.
At the end of November on an individual stock level his main holdings were within tobacco, which has been a major performing cyclical stock. Other sectors favoured by Mallon include consumer services (22.34%) and Industrials (15.63%).
Neil Hermon, manager of the Henderson UK Smaller Companies fund, moves up one notch in the ratings and as a result receives his very first AAA rating for his three-year risk adjusted performance. At the end of December his top holdings were Spectris (3.4%), a supplier of precision instrumentation and controls, and Informa (3.0%) a publishing and conference company.
The positive performance within the fund came from the conference and exhibition organiser, ITE, which rose by a healthy 26.1% on the back of strong full results being reported and a positive outlook for future earnings. The commercial vehicle rental company, Northgate, also rose 21% as the company reported good interim results and made reference to re-financing its debt structure which could boost profitability.
However, the main detractors came from the Hyder Consulting, an advisory and design consultancy company, which fell as profits were taken by investors after a good run.
A new position was taken in the mobile telecommunications company, Monitise.
Oliver Kelton of Waverton enters with an A rating for his 33-month risk adjusted performance on the Waverton European fund. Over this time he has generated returns of 15.06% for his investors. In comparison his Citywire benchmark, the FTSE World Europe, has risen by 5.92%. He generates Alpha within his portfolio using a bottom-up stock selection process and maintaining positions in stocks that are highly liquid.
Over the past quarter the fund has outperformed its benchmark and has recouped most of the losses suffered over the summer. The performance was led by stock performance, most notably his positions in BME, Indea and Nokia among others. His stock picks in Mediaset improved on the back of improved indications for advertising in Italy and Spain and Nokia was in higher demand as it recently launched its smartphone, the Lumia 920.
At the end of December his main holdings were in Lloyds Banking Group PLC (7.03%) and in BNP Paribas (6.76%).
Premier’s equity manager
Chris Wright enters for the first time with an A rating based on his three-year risk adjusted performance on the UK equity fund, Premier Ethical, and the European equity fund, Premier European Optimum (see next page). The latter fund has risen 13.69% over this period, handsomely outperforming the LCI FTSE All-Share/FTSE World-Eur excluding UK (50:50) benchmark, which has rose by 3.53%.
Premier European Optimum performed well until November 2012, when it suffered due to a number of stocks in the FTSE 100 top 20 companies that missed the rally. Wright's holdings in Vodafone, Glaxo, BP and Royal Dutch Shell were all affected. Also holding back performance was a prominent position in Go Ahead Group and Tullet Prebon which had poor ex-dividend. He is now looking carefully at his positions in these stocks. On the plus side, his positions in insurance stocks such as RSA and Allianz provided good performance and also larger European stocks that were exposed to worldwide economic growth performed well.
Global equities manager
Vipin Ahuja enters for the first time with a AA rating for his 30-month risk adjusted performance on the Allianz Global EcoTrends fund. His main investment focus is within the eco-energy, pollution control and clean water sectors. At the end of December his top holdings included US-based Polypore International, a filtration company that develops, manufactures and markets specialised polymer-based microporous membranes (5.33%) and EDP Renovoveis, a company headquartered in Madrid (3.78%).
Geographically he has more than 58% invested in the US and around 7% within the UK.
Thomas See enters for the first time with an A rating for his three-year risk adjusted performance over as many funds which contribute to his ratings analysis. These are the Schroder Income Maximiser, Schroder Asian Income Maximiser and the Schroder ISF Global Dividend Maximiser funds. The largest fund by Assets under Management (AUM) is the £820.2 million Schroder Income Maximiser fund. The fund has risen by 23.1% over this time.
His main holdings at the end of December were AstraZeneca (6.0%) and Lloyds Banking Group (5.0%) with main sector allocations within financials (29.4%) and consumer services (19.7%).