Beleaguered asset manager Gam has boosted its emerging market equities expertise in Hong Kong, but UK fund selectors say the “little-known” team has its work cut out to appear on their radar anytime soon.
The firm announced on Monday that Rob Mumford (pictured) has joined the emerging market equities team to work alongside investment director Tim Love and investment manager Joaquim Nogueira on the $970m (£760m) franchise.
Mumford, who has 25 years’ experience in emerging markets, joins from MNP Advisers, a consultancy servicing asset managers and family offices. He previously spent 10 years as an emerging markets equity portfolio manager at Credit Suisse, CQS and Silver Tree. He is also a former head of absolute return research Asia and head of Hong Kong and China research at Macquarie Bank and Société Générale, respectively.
Love said: “Rob’s appointment represents our commitment to delivering the very best outcomes for our clients.”
Unknown team in the UK
AJ Bell head of active portfolios Ryan Hughes said: “The addition of Rob Mumford to the team brings additional resource in an area that is particularly diverse so his experience will be beneficial.”
However, Hughes said the emerging markets team at Gam is relatively unknown in the UK, particularly in comparison to the big names in the sector such as Fidelity’s Nick Price or Hermes’ Gary Greenberg.
He also noted that performance of the strategy has been average since launch, although it did perform strongly when technology was driving the market higher until March last year. But these gains were given back during the sell-off in the second half of 2018.
According to FE data, the Ireland-domiciled Gam Star Emerging Equity fund has returned -16.43% and 63.83% in sterling terms over one and three years, respectively, versus the MSCI Emerging Markets index’s -11.33% and 57.36%.
Hughes said: “Given the recent challenges faced by Gam and the relatively little-known team in emerging markets, it may well be some time before investors get comfortable with the brand and consistent longer-term performance will need to be seen before this fund appears on people’s radars.”
Gam looking to recover
Tilney managing director Jason Hollands also said he was not familiar with the team or product, but noted it is an interesting time to be boosting an emerging markets team given the asset class had such a tough 2018. He said the hire is perhaps a sign Gam is looking to sort itself out after a torrid year.
“Gam has been through a really tough time, so they need to start getting on the front foot with building up a team and highlighting other products and capabilities,” he said.
Hollands said Tilney is actually positive on the outlook for emerging markets mainly because it “looks oversold”.
Problems for the Swiss fund group started last summer after the suspension of absolute return bond fund (ARBF) manager Tim Haywood for conduct issues concerning his record keeping and due diligence in certain instances.
Gam was forced to gate the range following high levels of redemptions before the fund board ultimately decided to liquidate the range.
