M&G has announced Tom Dobell, manager of the £1.4bn M&G Recovery fund, is stepping down from his fund management responsibilities and leaving the firm at the end of December.
Michael Stiasny will take over the management of the fund from Dobell (pictured) at that time.
The change comes as part of an ongoing review of M&G’s mutual fund range, the firm said in a press release.
As a result, the fund will refresh its investment approach, with an increased focus on mid-sized companies that have contributed most to value creation over the fund’s lifetime and on valuation opportunities created from companies experiencing difficulty.
There will be no change to the fund’s investment objective and policy.
M&G chief investment officer Jack Daniels said: “I’d like to thank Tom for his dedication to the M&G Recovery fund and its investors. While the environment for his style of investing over the past decade has been very challenging, his effort and commitment on behalf of customers have never faltered.
“He steps down after 28 years at M&G with our best wishes for this next chapter of his life.”
Dobell joined M&G in 1992 as a UK equity manager on the segregated pension fund desk. He became manager of the M&G Recovery fund in March 2000.
Dobell said: “I’d like to thank M&G for the opportunities it has given me throughout my career. It’s been an immense privilege to manage the M&G Recovery fund, even throughout challenging investment cycles.
“I leave the fund’s investors in the capable hands of Michael Stiasny and I wish them the very best for the future.”
Stiasny has spent 20 years at M&G. He has headed the equity research team and has managed funds including Charifund, the M&G UK Income Distribution fund and the M&G Dividend fund.
He will continue to manage his existing funds alongside the M&G Recovery fund and the firm is seeking a senior hire to support him.
Daniels added: “With a highly experienced investor in Michael Stiasny and a renewed focus on the M&G Recovery fund’s core strengths, we believe we are well positioned to meet the fund’s objectives and deliver investors the returns they expect.”
M&G said over his tenure to 11 September 2020, Dobell has delivered a 127.7% cumulative return after fees, compared to the FTSE All Share return of 118.4%, ranking the fund in the second quartile of its IA sector.
According to Trustnet data, the fund is fourth quartile over one, three and five years. It has underperformed the IA UK All Companies peer average over those periods, delivering -20.3%, -19.3% and -3%, respectively, versus the sector’s -9.9%, -3.1% and 17.6%.
In December, the fund was dumped from the Hargreaves Lansdown Wealth 50 in a decision described as a long time coming after its poor run of performance.
AJ Bell head of active portfolios Ryan Hughes said Dobell delivered some fantastic performance for investors when his value style was in favour and the fund grew to be one of the largest UK equity funds at the time. However, performance really struggled as investors moved away from value and towards growth.
“Dobell admitted himself that the fund became too large and had too many stocks in a rare moment of contrition from a fund manager,” he added.
Hughes said investors will need to consider carefully whether to stick with the fund under the new manager.
“While the investment style isn’t likely to change, there looks to be an increased focus on medium-sized companies which is likely to result in some turnover in the portfolio while the new manager repositions it,” he said.
“For those that still want a value style, Fidelity Special Situations and Man Undervalued Assets both make for strong alternatives.”
