Mike Riddell, the bond fund manager who is leaving Allianz Global Investors, is to become lead manager on a pair of struggling funds at Fidelity.
Riddell is joining Fidelity with the job title of senior portfolio manager, and takes on responsibility for the Fidelity Strategic Bond fund.
This fund is a £370mn vehicle which has returned just 0.5 per cent over the past five years, compared with the sector average return of 7.6 per cent for the average fund in the IA Sterling Strategic Bond sector.
Taking a three year view, it has lost just under 10 per cent, compared with the sector average loss of 3 per cent.
Riddell will also become lead fund manager on the Fidelity Flexible Bond fund, a £117mn mandate which has lost 10 per cent over the past three years, compared to a sector average loss of 3 per cent.
His will also run a Luxembourg-domiciled sustainable bond fund and an Ireland domiciled multi-asset credit fund.
His co-manager on all of the funds is current Fidelity employee, Tim Foster.
It was announced yesterday (May 2) that Riddell is set to leave Allianz Global Investors after eight years, where he held the title of head of macro unconstrained within the fixed income team.
The principal fund he ran at Allianz was the £929mn Strategic Bond fund, which has lost 29 per cent over the past three years, compared with the IA Sterling Strategic Bond sector loss of 3 per cent.
Riddell has previously attributed the underperformance to having substantial exposure to long duration bonds in recent years.
Long duration bonds sharply underperformed in 2023 as interest rates rose globally in response to high and persistent inflation.
In such an environment, shorter-duration bonds typically perform better, while long duration does well when rates are expected to fall.
Prior to his role at Allianz, Riddell worked as a bond investor at M&G.
david.thorpe@ft.com
