The past five years have seen stockmarkets rise, fall, and rise again numerous times over.
For fund managers, it has certainly been a trying time and while some have delivered outstanding performance, others have had a more difficult experience.
In an industry made up of more than 2,000 funds, there will naturally be those that race ahead and others that are consistently playing catch up with the elite. There is also always a handful of underdogs – those that have experienced a few years of bad performance but have, to the surprise of many, turned things around and risen from the ashes.
This year alone has seen star managers such as Fidelity’s Anthony Bolton and BlackRock’s Sam Vecht admit that they have got things wrong but are working hard to put get their funds back on track.
In April 2013, Mr Vecht, discussing the losses on his £130.7m Eastern European trust, said in a statement: “It’s a big sector and I got stocks wrong”. While June this year saw Anthony Bolton pledge a turnaround in performance on the Fidelity China Special Situations fund before he retires in April next year.
Investment Adviser’s Autumn Investment Monitor identifies those managers who have turned around performance in the past five years, taking their funds from fourth quartile to top quartile.
Using data from FE Analytics, the list of turnaround managers was compiled using a simple metric. To be included, the fund must have a five-year track record with the periods running from September 2 to September 2 in each calendar year. Within the five years, the turnaround funds first suffered at least two years of bottom-quartile returns when measured against their sectors and have seen performance improve in subsequent years without slipping back into a lower quartile.
Finally, the fund must have delivered a top-quartile performance in the past 12 months.
The results have been ranked by the performance figure for the past year to September 2 to complete the list of Investment Adviser’s turnaround managers.
Included in the list are well-known names such as Susan Sternglass Noble of the Axa Framlington Financials fund, JPMorgan’s Peter Kirkman and Simon Poncet, and Stewart Cowley for the Old Mutual Managed fund.
The largest fund to appear in the list is the £478.7m CF Ruffer Japanese Equity fund, managed by Kentaro Nishida. When compared against its IMA Flexible Investment sector peer group, this fund has sat in the bottom quartile for four years until jumping to the top quartile based on its September 2012 – September 2013 48.04 per cent return.
Other turnaround managers, such as those at the helm of Templeton Europe and JPM US Smaller Companies funds, have seen a more gradual rise, with performance figures staircasing them through the third and second quartiles of their sectors before recording a top-quartile performance for the time period analysed.
