Square Mile has demoted a trio of funds, including the Man GLG Japan and Blackrock European Dynamic strategies, which have seen their stalwart managers exit.
In its Academy of Funds ratings round-up for October, Square Mile announced the £1.1bn Man GLG Japan Alpha and £4.5bn Blackrock European Dynamic funds would be stripped of their AAA ratings to reflect the loss of the “seasoned investors” on both strategies.
Man GLG Japan Alpha lead manager Stephen Harker (pictured) announced he would be retiring from the business in March 2021, alongside senior portfolio manager Neil Edwards. The move was described as a “big blow” to the value-based strategy which is in the midst of a performance slump.
Also last month longstanding Blackrock European Dynamic manager Alister Hibbert confirmed he would be taking a step back from managing the fund to concentrate at his other responsibilities at the firm.
Man GLG Japan Alpha has been rebadged as a AA fund, which Square Mile said reflects its “ongoing conviction in and high regard” for new lead manager Jeff Atherton and his support team.
Meanwhile, the Blackrock European Dynamic fund has been downgraded to an A rating. Square Mile said that while it found Hibbert’s replacement Giles Rothbarth a “well primed” successor it noted he is “untested as a sole manager”.
Square Mile also demoted the Artemis European Opportunities fund to an A rating from AA following co-manager Mark Page’s retirement. The strategy will be run by existing co-manager Laurent Millent who Square Mile described as a “capable investor” who “will continue to uphold the fund’s investment philosophy and process”.
However it retained the A ratings for the Axa Framlington Managed Balanced fund and Blackrock GF European Special Situations fund despite both strategies also suffering manager departures.
Baillie Gifford Positive Change nabs A rating
Elsewhere Square Mile awarded the Baillie Gifford Positive Change fund a Responsible A rating. The fund, which passed its three year track record in January, has exploded in popularity after being among the Edinburgh manager’s strongest performers this year and one of the top performers in the IA Global sector. Since July assets in the fund have swelled from £550m to £1.4bn.
See also: Kate Fox: How Baillie Gifford’s impact fund is quadrupling the returns of its peers
Though Square Mile noted Positive Change is a relatively new venture for Baillie Gifford it noted the firm has dedicated significant effort and resources into the fund.
“It applies a well-defined and distinctive investment process to identify companies that suit the strategy, and it places a strong emphasis on both returns and providing a positive impact over the long term,” the research house said.
“In Square Mile’s view, it should appeal to long-term investors who wish to invest in a manner that should be positive for the environment and society.”
Alongside Baillie Gifford Positive Change, the Goldman Sachs Emerging Markets Equity and Veritas Asian funds also entered Square Mile’s Academy of Funds with an A and AA rating respectively.
The Embark Horizon Multi-Asset fund received a ‘Recommended’ rating.
