Sandy Nairn has quit Franklin Templeton and will be taking the Global Opportunities investment trust with him.
A stock market announcement confirmed that Nairn, who was also a founding partner of Edinburgh Partners, will now become full-time manager of the £100mn trust, with the fund management contract with Franklin Templeton being terminated by the middle of May.
He formally left his role at Franklin Templeton at the end of December, having announced his resignation several months earlier.
Nairn said: "We are moving into a world in which free money no longer drives all returns to unjustified heights. I believe that we are in a transition back to one where the traditional investing virtues will once again reign. This is not about value versus growth or other factors such as ‘quality’. It is simply about how much you are willing to pay for the characteristics and future of an asset.
"We look forward to the day where risk aversion rises to the levels that disregard for risk reached in the recent past. That will be the time that we again see an abundance of attractive investable opportunities.
"Our proposition to shareholders is that, as and when those opportunities present themselves, the company will be willing and ready to use the flexibility that our investment policy affords us to pursue them to the full. We are tactically, not permanently, bearish.
"When valuations permit we look forward to being bullish and I believe that our strategic partnership with Goodhart will greatly assist us in sourcing and executing such opportunities as they arise."
Nairn, who has resigned as chairman of Franklin Templeton's global equity group, will take a salary of £75,000 for running the trust, plus receive a fee for being a director of it for £25,000.
He has run the Global Opportunities trust since 2003, when it launched.
The trust has outperformed its sector, the AIC Flexible Investment sector, over five years returning 23.6 per cent while its sector returned 8.25 per cent.
Nairn will run the listed equity part of the trust, while investments will also be made in unquoted assets, with the ideas for those investments being brought to Nairn under a consultancy agreement with specialist investment house Goodhart.
Goodhart will receive 0.12 per cent of the fee plus extra depending on how many of the investment ideas proposed by Goodhart make it in to the trust.
Nairn is also a minority shareholder in Goodhart, and if he receives remuneration from this as a direct result of his investments in the trust, his £75,000 salary will be cut.
The management fee on the trust will drop to 0.8 per cent.
Cahal Dowds, chairman of the Global Opportunties trust, said: "We are pleased to announce both the appointment of Dr Nairn as a full time executive director and the strategic relationship with Goodhart. In addition to the expected reduction in ongoing costs for shareholders, these management arrangements will provide the company with valuable support in accessing the wide range of investment opportunities and investment management expertise available to it under its expanded investment policy."
Nairn was chief investment officer at Scottish Widows Investment Partnership between 2000 and 2003. Edinburgh Partners, the firm he co-founded in 2003, was sold to Franklin Templeton in 2018.
At the time of its sale, it managed around £6bn in global equity money.
Between 1990 and 2000, Nairn was a director of global equity research at Franklin Templeton, and was based for a period in the US.
Franklin Templeton confirmed Sandy Nairn was no longer one of its employees but they said it would continue to work with the Franklin Templeton Institute as an external senior fellow.
Nairn is not the first big name fund manager to quit his fund management firm and take his trust with him. In 2019 Alexander Darwall quit Jupiter and took the £1bn European Opportunities investment trust with him.
In 2018 Mark Mobius quit Franklin Templeton and set up a new trust.
david.thorpe@ft.com
