[ad_1]
Star fund manager Alexander Darwall didn’t think twice when he left Jupiter in 2019, setting up a new investment boutique in a building directly opposite his former employer near Victoria Station.
About five years later, Jupiter has lost another big name. That’s Ben Whitmore, who manages around £10bn across multiple strategies at Jupiter.
Whitmore is the latest example of a growing group of star portfolio managers choosing to go into business for themselves, which requires a shift away from focusing solely on money management.
“Becoming independent is a big step for fund managers who are used to all the comfort blankets that come with an established asset management company,” said Ryan Hughes, investment director at AJ Bell.
“Sales, marketing, compliance, risk and other support functions are all well-established and having to implement this when setting up your own shop can be a daunting experience for fund managers. It is easy to see how financial conduct authority registration, business planning, and fund managers could be distracted from their core business of managing money.”
Some prominent investors have left large fund management groups to pursue their own paths.
But how have they fared since independence?
alexander darwall
Darwall’s departure from Jupiter had a significant impact on the FTSE 250-listed asset manager, which later said his departure in 2019 led to more than £4bn of capital outflows.
Darwall is considered one of Jupiter’s star European stock pickers and founded Devon Equity Management in 2020.
He took with him the European Opportunities investment trust, which managed £924m, which he oversaw at his previous employer.
He attracted attention in 2020 when it was revealed that he owned a large stake in German payments company Wirecard. Wirecard collapsed following one of the biggest fraud scandals in history.
Darwall later apologized to investors for supporting the company, which at one time accounted for 17% of his mutual fund. He told investors that investing in Wirecard was a “mistake”, admitting: “I invested in too much, and that’s my fault.”
read Hedge fund managers pour millions of dollars into their own funds to reassure investors
He has also attracted attention for reasons unrelated to his ability to manage money. The fund manager, one of Dartmoor’s largest landowners, is involved in an ongoing dispute with Dartmoor National Park over a legal challenge to overturn a ban on wild camping.
Devon Equity Management’s profits in 2022 were £3.7m, down from £5.2m the previous year, according to a filing with Companies House.
julie dean
One of Citi’s best-known investors, Julie Dean, announced her departure from Schroders in 2014, just a year after joining the FTSE 100 group following its acquisition of Cazenov Partners.
The UK equities manager’s departure sparked a big exodus from Schroders. She then set up Sanditon Asset Management with her former colleagues at Cazenove, Tim Russell and Chris Rice, increasing her wealth to around £500m.
However, the company announced in October 2019 that it would wind down its operations as investors began to lose appetite for its value investing style, which buys stocks at a deep discount to their intrinsic value.
Jeremy Lang and William Pattison
Former Liontrust fund managers Jeremy Lang and William Pattison founded global equities specialist Aldevora Asset Management in 2010 following “strategic differences” with their former employer.
Mr. Lang, who oversaw the majority of Liontrust’s personal assets, spent 14 years at the asset management firm, where he was responsible for managing its UK equity portfolio and all of its investment management activities.
Mr. Pattison spent 10 years at Liontrust before partnering with Mr. Lang to form the venture. In May 2023, Mr. Pattison decided to step down as CEO to focus more on portfolio management operations.
read Why DWS still believes in star manager culture
However, Aldevora announced in January that it would close its operations and return funds to customers.
Aldevora’s profits fell to £22m in the 12 months to the end of March 2023 from £29m a year earlier, according to documents filed with Companies House. Revenues in 2023 fell by almost 22% from £42.4m to £33.2m.
neil woodford
Once known as Britain’s answer to Warren Buffett, Neil Woodford’s departure from Invesco in 2013 shocked the industry. Mr Woodford worked at Invesco for more than 20 years and at the time of his retirement was overseeing nearly £25bn of assets at the fund house.
Dubbed the ‘Oxford Oracle’, he founded Woodford Investment Management in 2014 with colleagues from Invesco. His equity income fund launch was the most successful in British history, raising billions of dollars from investors in the first few weeks.
Woodford and business partner Craig Newman shared tens of millions of pounds in dividends from the venture they founded.
But Woodford stalled due to poor performance and heavy bets on private equity. Liquidity issues meant an increasing number of investors wanted to exit the fund, meaning they could not be repaid.
Woodford’s flagship fund, which at its peak managed more than £10bn, was suspended in June 2019, trapping around 300,000 retail investors. Shortly after, Woodford Investment Management announced in October 2019 that it would wind down its operations, ending the star fund manager’s career.
Richard Pease
When Richard Pease left Henderson in 2014 to set up Cracks Asset Management, his departure sparked a legal battle with his former employers over £2.7m in unpaid management fees.
Mr Pease claimed the eight months it took to transfer his European Special Situations Fund to the new business meant he had lost marketing opportunities.That contributed to investors withdrawing from the fund.
Pease won a legal battle in 2018.
read Lansdowne Partners acquires London-based Crux Asset Management
However, the assets of the European Special Situations Fund have fallen from around £1.2bn in 2014 to £460m in 2022. At the end of last year, Crux Asset Management had total assets across all its strategies of around £1bn.
Last year, Lansdowne Partners acquired Crux for an undisclosed sum, and Pease announced that he would step down upon completion of the deal.
james bateman
James Bateman was running Fidelity International’s multi-asset business when he announced in 2019 that he was leaving to start his own fund management venture.
Bateman joined Fidelity in 2016 as chief investment officer and launched New Value Investments. His father, Barry, himself a veteran of Fidelity International and rising to vice chairman of the company, was also involved in the business.
However, Bateman announced in May 2022 that he would be winding down his business due to poor health. He said at the time that he would focus on managing family assets rather than client assets.
To contact the author of this article with feedback or news, email David Ricketts.
[ad_2]
Source link
