What to do if a fund manager leaves?

"We want to understand the culture of the firm, what makes them tick, how they are remunerated and we want to make sure that their interests are aligned to producing excess performance.

"The team dynamic can be important, so we will speak to different members of the investment team and do meetings in our office or at the firm’s office to get an idea of the wider working environment.”

Stanesby says that if a manager leaves his initial reaction is to increase the number of meetings he has with the replacement, relative to the number he would have with the more established managers on his roster, though he adds that if a manager he regards as a 'star' exits then “its a blank sheet of paper”, as he is forced to ponder where the future performance will come from.

Team-based

Shaw is wary of the notion, pushed by some firms, that with a team-based approach the exit of any one individual does not matter.

He says: “If one individual is so unimportant, why do the fund houses have to tell us about their exit and put press statements out?”

If a fund does have just one core decision-maker, then really there are very limited options for a fund buyer.Peter Doherty, Arbuthnot Latham

Similarly, Peter Doherty, director of investment management at Arbuthnot Latham, is skeptical about focusing on the team without focusing on an individual manager.

He says regardless of the team, “one person is making the decisions". Additionally, the manager will have built up years of understanding of the market and the asset class.

Doherty says: "So if they are a growth manager, they will have experienced multiple economic cycles and seen the impact of those cycles on their asset class. And it may be that the less experienced members of the team do not have that experience.

"So if a fund does have just one core decision-maker, then really there are very limited options for a fund buyer. It’s not the case that one just automatically sells the fund, but certainly one should be observing it closely.”

Doherty's propensity to sell a particular fund is also influenced by whether he feels a suitable replacement is already available.

There is no need to stay in a fund if you are not comfortable with doing that.Peter Doherty, Arbuthnot Latham

He adds that if a fund meets the initial criteria he sets out, it is then placed on a “watch list” and monitored intensely for a period of time that could run to several years before eventually being invested in.