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Firing Line: Colin McQueen

This system displayed its merit when Pearson was touted for inclusion. Share prices of the British multinational publishing and education company fell by 30 per cent in January following the latest in a string of profit warnings.

Mr McQueen said: “In the long run, Pearson has good market positions, learning is a good sector, but we were nervous about some of the aspects of the price rises. The management was defending the dividend when it looks like they were keeping their fingers crossed to be able to pay it.”

Mr McQueen is well versed on the pressures of investment, but he is subject to additional strain with the knowledge that his parent’s money is invested in the product.

The fund performance, which returned 65 per cent in five year to 21 February 2017, would help put their minds at ease.

Active management has come under staunch criticism following the publication of a damning interim report by the Financial Conduct Authority.

In the report, the regulator berated some active funds as being closet trackers and also concluded that some active managers made sizeable profits from underperforming funds.

Mr McQueen said: “Managers with high active shares have tended to perform well over time. We have a 95 per cent active share in the fund. It is a fair criticism that you shouldn’t have active managers just replicating the index. Fund managers should be clear to investors about what they are offering and why it is different to going out and buy a tracker fund.”

Some asset managers have taken steps to make clear what investors pay. The publication of research costs appears to be en vogue at present.

Sanlam Four does not make the research costs of its funds publicly available – although this policy is under review, Mr McQueen revealed.

He added: “It is something we are looking at internally. Given how little we use external research and the low turnover rates, it is not something that we have paid attention to in the past. But every fund manager will have to look into it.”

Myron Jobson is a features writer of Financial Adviser

COLIN MCQUEEN'S CAREER HIGHLIGHTS

October 2010 – present

Senior fund manager

Sanlam Four

October 2005 – January 2009

Head of global value equities

Morgan Stanley Investment Management

September 1989 – June 2005

Portfolio manager

UBS