Investments 

'I wouldn’t recommend my son become a fund manager'

'I wouldn’t recommend my son become a fund manager'

The rapid pace of technological change means many jobs which exist today, including fund management, could be obsolete for the next generation, according to Stephen Snowden, co head of fixed income at Kames.

He said the pace of disruption is such that “it is difficult to know what to say to a 14-year old about what job they should train for in future”.

Mr Snowden said the rise in popularity of passive investment vehicles and algorithmic trading strategies, which will reduce fee levels, could pose a threat to active management.

He said many other professions will be affected.

”I know new jobs will be created. People talk about how in the industrial revolution jobs were created for the people who left the farms. New jobs will be created this time, but I’m not sure it will be enough jobs.”

Mr Snowden said he believes the world is headed for a prolonged period of low inflation and poor economic growth, as ageing populations have the effect of spending less, which, in turn, generates less wealth and jobs for the next generation, and so contributes to lower inflation.

Technology further reduces the number of jobs created, he argued.

As an investor, Mr Snowdon has taken a view that inflation will not be as significant for investors as the market currently expects, and so bond yields will not rise to the extent many market participants expect.

With this in mind, he has positioned his funds for bond prices to remain stable.

He said bonds are already pricing in more interest rate rises, and so the risk of losses is reduced as a result.

David Jane, a multi-asset fund manager at Miton, said the yields on most bonds are so low that they do not justify the risks.

David.Thorpe@ft.com

Comments