With no-announcement yet about Dean’s plans, I’ll leave it to others to speculate on the wheres and the whys, though I will suggest that in the UK mid-cap space it often pays to have a smaller asset base.
As the key figure in the ‘business cycle’ approach to investing, it would be interesting to hear Dean’s views on the cyclical nature of the asset manager. After all, she’s not the only high-profile UK equity stockpicker to make a career change of late and – given where we are in the bull market cycle – wealth managers say they’ve seen it all before.
Looking around
“Three or four years ago there weren’t many changes because people were just happy to have a job in the credit crunch, but now there are people who are good at their jobs and think now is the time to see what’s around,” says Gary Potter, co-head of multi-manager at F&C Asset Management.
“There are a number of companies that are in need of shoring up. Investec too have clearly made a statement [in hiring Simon Brazier and Blake Hutchins] after they lost Philip Rodrigs to River & Mercantile.
“I think we will see more to come over the next six to eight months and as we go through the end of the year and bonus periods. The bull market is back on and so people start to come out of the woodwork again.”
For Jason Briton, founder of Investment Radar, the “manager-merry-go-round” is set to go full swing: “The likelihood is for more moves over the coming months as, anecdotally, many groups are looking to hire expertise in their attempts to gather assets. Additionally the negotiating positions of many managers have been strengthened from the better conditions of the past few years.”
“Alas each move will cause problems for advisers and their clients alike with few solutions able to react both quickly and tax-efficiently”.
Toby Ricketts, CEO at Margetts Fund Management, agrees that during a credit crisis managers feel more vulnerable, with a contraction and consolidation and less movement.
Big inflows
“But as we’ve seen prices of assets rise generally, there is probably quite a lot of managers now with big inflows who are keen to capture their value where they are, and if they can’t they’ll move,” he says.
Still, he suggests that being an expanding asset manager can have its drawbacks: “The question for Schroders having bought Cazenove is how sticky is that money if more managers leave? It could start to put a dent in the value of the acquisition if the assets start to flow away.”
