Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

Tidjane Thiam: I was wrong about the ‘magician’ Woolnough

Tidjane Thiam: I was wrong about the ‘magician’ Woolnough

Prudential chief executive Tidjane Thiam admitted he underestimated the ability of M&G bond star Richard Woolnough and his colleagues to generate such major interest on the continent.  

Thiam made a guest appearance at M&G’s annual investment conference and lauded the M&G Optimal Income fund manager, affectionately dubbed the ‘magician’ by the firm’s Paris office, while paying credit to the investment and distribution effort at Prudential's asset management subsidiary.

‘I told them it was not going to work but we can see the results,’ Thiam said. 'It’s the first time in my life I was happy to be wrong.’

Woolnough’s Optimal Income strategy has swelled to €22.7 billion (£18.8 billion) and is M&G’s best-selling product across the continent.

Citywire A-rated Woolnough told the conference it had been a tough time for bond fund managers, but suggested there were signs the bear market in the asset class could be coming to an end.

‘[At the moment] there’s not a single bond fund manager in the world that likes bonds,’ Woolnough said.

’30-year bond yields are the cheapest they’ve been in 15 years and when yields get to 4% we would think the bear market has been priced in.We’re not there yet but hopefully we’ll get there soon.’

Overnight the Treasury Department auctioned $13 billion-worth 30-year bonds at 3.525%.

Woolnough also explained why he had cut his equity exposure, which ran close to its limit last year as he sought to protect the fund’s income.

‘There was lots of value in equities in 2012. I’m an equity tourist – if they’re attractive I buy them and if I don’t see value I won’t buy them.’

Last week it was rumoured Woolnough was the mystery recipient of a £17.5 million pay reward from Prudential in 2013.

The Opitmal Income fund, which launched in December 2006, has returned 87% in the five years to the end of March versus a 73% rise in the benchmark.

The fund's maximum drawdown of 3.03% is the second best in it peer group, which contains 43 funds with a five-year track record.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Related Fund Managers

Richard Woolnough
Richard Woolnough
28/50 in Bonds - Sterling Strategic Bond (Performance over 3 years) Average Total Return: 27.26%
Citywire TV
Citywire TV
Citywire TV
Play Where A-rated Pattullo is finding the best bond opportunities

Where A-rated Pattullo is finding the best bond opportunities

Henderson Global Investors head of retail fixed income explains how he is managing his fund against the surprise current monetary policy divergence.

1 Comment Play Taxicab Tenner: Allianz Global Investors' AA-rated Simon Gergel

Taxicab Tenner: Allianz Global Investors' AA-rated Simon Gergel

Our much anticpated new series is here! We hand a black cab driver a tenner and grill the manager of the 125-year Merchants trust until the meter runs out.    

Play Europe bulls, a retail boost and why a little inequality can be a good thing

Europe bulls, a retail boost and why a little inequality can be a good thing

This week’s Investment Pulse looks at whether investors should be bullish on Europe, the surprise rise in UK retail sales and if a little inequality is a good thing.

Your Business: Cover Star Club

Profile: meet the duo at the heart of Hargreave Hale's succession plan

Profile: meet the duo at the heart of Hargreave Hale's succession plan

For the first time in the company's history a non-Hargreave is now at the head of the north west broker and asset manager

Wealth Manager on Twitter