The change of McVeigh’s role means that Steve Davies, who joined Jupiter’s UK growth team as an analyst in 2007 and became a co-manager of the UK Growth Fund in early 2013 will take over as sole manager of the fund in May.
As a secondary result of the shift, the group also plans to merge Davies’ current fund, the £123m Jupiter Undervalued Assets Fund (that he has managed since 2012) into the £1.4bn Jupiter UK Growth Fund, subject to regulatory and unit holder approval.
According to the group, the two funds are managed in a very similar style, with a predominant focus on UK equities and a long-standing bias toward large cap stocks.
“The investment approach is bottom up and focuses on opportunities in ‘recovery’ stocks (companies deemed un-investable by the market) and ‘growth’ stocks (those companies which can generate above-average rates of growth over an extended time period),” the firm said.
The change in McVeigh’s role is part of an ongoing shift in focus for Jupiter that began in November 2014 with the restructuring of its environmental and sustainability strategy team and with the creation of a governance research team under Ashish Ray.
Stephen Pearson, Head of Investments, Jupiter, said McVeigh’s new role: “reflects the interest and influence he has had in this field at Jupiter. It also underlines our approach to engagement, emphasising the close cooperation of our stewardship and investment activities.
Business as usual
Tom White, associate director, research at Tilney Bestinvest, believes the change will be business as usual for investors in the funds.
“Jupiter UK Growth was one of the top performing UK funds under McVeigh from 2003-7, but suffered greatly in the financial crisis in 2007-8. The fund has bounced back strongly in recent years however, and once again sits towards the top of the performance rankings. This bounceback coincides with Steve Davies’ increased involvement on the fund,” he said.
The change seems a logical progression, he added, following a meeting last year wherein Davies indicated that he had gradually begun to increase his role in the fund as McVeigh became more involved in governance matters.
Darius McDermott, managing director, FundCalibre agrees that investors should feel little ill effect, with the FundCalibre research team deciding to retain the fund’s elite rating, despite the manager change.
“Ian McVeigh is a hugely experienced manager who has run this fund successfully since 2003. Any UK equity team would be lessened by his departure. However, Steve Davies, the co-manager, has grown in stature since joining in 2007. We rate him as one of the elite managers in the IA UK All Companies sector and we believe he will continue to drive the fund’s outperformance in a wide range of market conditions,” he said.
As for the merger of the two funds, McDermott added: “Given Davies employs a similar approach and bottom-up process on both funds, this merger makes sense without comprising fund capacity. The Jupiter Undervalued Assets Fund has 85-90% commonality with Jupiter UK Growth, with the difference being that the latter holds some limited international exposure. Both funds seek to capitalise on opportunities in ‘recovery’ and ‘growth’ stocks.”
