Terry Smith will stop managing the £333m Fundsmith Emerging Equities Investment Trust he launched five years ago.
Mr Smith will hand over to two of his deputies on the trust, with Michael O’Brien becoming manager and Sandip Patodia becoming assistant portfolio manager.
The changes become effective from May 31, and were revealed in an announcement to the stock exchange this morning (22 May).
Coinciding with the announcement of the change in manager, the board of the trust announced a cut in the management fee from 1.25 per cent to 1 per cent.
Mr Smith will continue to advise the trust in his capacity as chief investment officer of Fundsmith, the fund management company he co-founded and which runs Fundsmith Emerging Equities trust.
He also advises the £1.1bn Smithson investment trust he launched last year, which invests in global mid- and small-cap equities and will continue to manage the £17bn Fundsmith Equity fund.
The Fundsmith Emerging Equity trust has underperformed relative to its peer group since launch, returning 25 per cent over the past five years, compared with 39 per cent for the AIC Emerging Markets sector in the same time period.
Mr Smith has said if the emerging market trust was successful it should outperform the developed market funds he runs over the long-term as emerging markets generally have stronger growth prospects.
Commenting on the change in management, he said: "I am delighted that the significant role played by Michael and Sandip in the formation of the fund and its ongoing activities is being recognised.
"The initial success of Fundsmith's other investment trust has made me realise that my oversight as CIO, with dedicated fund managers doing the day to day work, has worked extremely well and I believe the changes we are announcing today will help deliver the long term outperformance that we seek.
"The fee reduction also brings the charges closer into line with our other funds whilst recognising the greater geographical research coverage that we have to maintain on Feet."