InvestmentsMay 13 2013

Schroders: Richard Buxton fund outflows ‘manageable’

Search sponsored by
ByNick Reeve

Schroders has said client withdrawals from Richard Buxton’s UK Alpha Plus fund remain “manageable”, as the product approaches a £1bn fall in size since the manager’s resignation.

The company said outflows from Mr Buxton’s fund have so far totalled roughly 20 per cent of its previous assets under management.

Since Investment Adviser broke the news of the manager’s departure in March, the fund has fallen in size from £3.7bn on March 14 to £2.8bn on May 9, according to data from FE Analytics, even after posting a 2.1 per cent return in that period.

Investment Adviser can reveal that Barings is the latest investor to withdraw money from Mr Buxton’s fund, with Barings’ multi-asset manager Andrew Cole having “significantly reduced” his stake in the fund. Across its multi-asset range, Barings previously had almost £500m invested in the UK Alpha Plus fund.

Other multi-managers and discretionary managers have also reduced or sold completely their stakes in the UK Alpha Plus fund in recent weeks, including Aviva Investors, Brown Shipley, Octopus and Ashcourt Rowan.

A spokesperson for Schroders said: “Redemptions have been manageable so far, at around 20 per cent of the fund. We have had an excellent response from the market to Philip Matthew’s appointment to manage UK Alpha Plus.”

Gary Potter, co-head of multi-manager at F&C, said he was remaining invested in the UK Alpha Plus fund in both his £91.3m F&C MM Navigator Progressive and £113.4m F&C MM Navigator Select products.

Mr Potter also owns the Jupiter Growth & Income fund, managed by Mr Matthews, who was announced as Mr Buxton’s successor last month.

“There is no immediate pressure on us to sell,” Mr Potter said. “Investors need to think about what Philip Matthews will do and how he will change the fund. A change is not necessarily bad.”

Mr Buxton quit Schroders in March and will take up the role of head of equities at Old Mutual Global Investors next month.

He will be joined by Ed Meier and Errol Francis, who have also quit Schroders.

Mr Matthews will take on the fund in September, with Schroder Income Growth investment trust manager Sue Noffke running the fund in the intervening period.

Mr Buxton also runs the £308m Schroder UK Growth investment trust, but this is set to pass to Cazenove Capital’s Julie Dean when Mr

Buxton departs, meaning Schroders will effectively retain control of the trust as it will complete its purchase of Cazenove in July.

The trust’s share price plummeted 9.3 per cent in the month following Mr Buxton’s resignation but has since bounced back significantly, meaning its share price was last week trading only marginally lower than before the announcement.