The number of boutique investment houses featured in the Investment Adviser 100 Club has fallen as funds from bigger groups benefit from consistent performance.
In 2012, there were 21 funds managed by boutique investment houses in the club of 85 funds (the remaining 15 spaces are allocated to groups), and this year that has fallen to just 16 funds.
Heavyweight groups Schroder Investment Management and Henderson Global Investors were the noticeable two that outshone most others this year, each seeing a significant boost in the number of member funds.
Schroders has gone from having just one fund in the club in 2012 – Schroder Tokyo – to 12 funds in the 2013 list as the group saw significant outperformance across the equity fund range. This figure includes four Cazenove Capital funds following Schroders’ buyout of the boutique investment house earlier this year.
Similarly, Henderson has seen its membership increase from two funds last year to eight in 2013, with established managers such as Alex Crooke (Henderson High Income trust and Bankers Investment Trust), Ben Wallace and Luke Newman of the UK Absolute Return fund and Patrick Sumner and Guy Barnard of the Henderson Horizon Global Property Equities fund.
Ben Yearsley, head of investment research at Charles Stanley Direct, says: “Bigger doesn’t necessarily mean better, but it can be a help at times. Larger organisations such as Fidelity, BlackRock and Schroders have vast global coverage, employing numerous analysts to scour the various different markets for shares with the most upside potential.
“However, while analyst coverage is important to feed fund managers with ideas, it isn’t the be-all and end-all. The key is how you use it. The fund manager still has to make the right decisions with the information available.”
The decrease in the number of boutique funds in the 100 Club member list this year is skewed as a result of Schroders’ takeover of Cazenove. This meant that the four Cazenove funds – including the UK Opportunities fund managed by UK equity star Julie Dean – in the 100 Club are no longer classed as belonging to a boutique.
Of the boutique houses included in the list, repeat membership comes from Baillie Gifford, which this year achieved membership for four of its funds spanning Japanese large and small-caps, corporate bonds and European equities.
New entrants for 2013 include fixed income specialist Kames Capital, with membership to the elite 100 awarded to its Investment Grade Bond fund, managed by Euan McNeil and Stephen Snowden, and the Ethical Cautious Managed fund, run by Audrey Ryan and Iain Buckle.
Jenny Lowe is features editor at Investment Adviser
The full list of 100 Club members can be found here.
