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Fund Times: Updates for Aberdeen, AMP, AXA, BT, Colonial First State, Goldman Sachs JBWere, Integrity, RREEF

Phillip Gray  |  27 Mar 2008Text size  Decrease  Increase  |  

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Source: Morningstar databaseIn recent news from the funds management industry you may have missed, Aberdeen has hired for its emerging markets team, and Integrity has hired a former UBS dealer; BT has lost its co-head of income, and RREEF a listed property portfolio manager; AXA's investment managers and Colonial First State have also had staff changes; Kerry Series is making the reverse journey back from boutique to institutional funds management, as AMP's new Head of Asia Pacific Equities; and Goldman Sachs JBWere has rationalised its managed fund product range.


Aberdeen appoints in Emerging Markets
Aberdeen Asset Management has moved Nick Robinson from the firm's US equities team to the 32-member global emerging markets team headed by Devan Kaloo, responsible for investment management for Aberdeen funds including Aberdeen Emerging Opportunities. Robinson has eight years' investing experience, having joined Aberdeen as a trainee in 2000, and will continue to work in the firm's office in Conshohocken, Pennsylvania.

Aberdeen selects emerging markets stocks on the basis of company management, business focus, balance sheet, corporate governance, and financial ratios, preferring companies with higher returns on equity and lower debt to equity than market averages. Prominent stockholdings at 31 January 2008 included global resources giant Vale (formerly CVRD) (4.06 percent of portfolio value); Petrobras (3.69 percent); China Mobile (3.26 percent); and Taiwan Semiconductor Manufacturing (3.03 percent).


Alliance Growth, Bernstein Value staff changes
AXA investment managers Bernstein Value and Alliance Growth have also had some staff change recently.

Hamish Fitzsimons joined the Bernstein Value team as a financials analyst on 3 March, reporting to Roy Maslen, and will also work as a member of the firm's global Financials sector team. Fitzsimons worked previously in Westpac's retail and wealth management businesses. Bernstein Value is the investment manager for domestic share funds such as AXA – Wholesale Australian Equity Value and AXA Generations – Bernstein Australian Equity Value.

At Alliance Growth, global healthcare sector head Norman Fidel will relinquish his responsibilities on 30 June as he moves to part-time work heading towards retirement. His replacement is Steven Nussbaum, currently Alliance's US healthcare lead, who joined the firm in 2002 from a position as medical products analyst at JP Morgan. Additionally, associate director of global growth research Mike Baldwin left the firm in late February. Baldwin's work in portfolio customisation and implementation has been taken on by Bob Scheetz. Alliance Growth runs the money invested in funds such as AXA – Wholesale Global Equity Growth and AXA Generations – Alliance Growth Global Equity.


AMP names Kerry Series Head of Asian Equities
AMP Capital Investors has appointed Kerry Series as Head of Asia Pacific Equities, reporting to Chief Investment Officer Mark O'Brien. Series was previously Investment Director Asian Equities at HSBC Asset Management in Hong Kong, and before that, managed Asian and international equities at Perennial Investment Partners. Most recently, he's been running his own Asian long/short boutique, DVA Capital, which he's in the process of winding up. Series will head three of AMP's regional equities teams – the Sydney-based Capital team, currently led by Gary Armor; the Wellington-based New Zealand shares team, headed by Guy Elliffe; and the Asian equities team, led by Karma Wilson.


BT loses Income Co-Head
BT Co-Head of Income Strategies John Sorrell is leaving the firm in May. Sorrell joined BT in August 2006, working with Co-Head of Income Scott Osborne, who will now manage the firm's credit investments with the assistance of Portfolio Manager George Bishay and Credit Analyst Peter Farac.


Colonial First State Income Co-Head to retire, firm hires in Global Resources
Colonial First State Co-Head of Global Fixed Interest and Credit Tony FitzGerald is to retire from the firm in December 2008. The firm says FitzGerald will relinquish his Co-Head role on 30 June, and will work on transitioning his responsibilities over the following six months. FitzGerald will continue as non-executive chair of the firm's credit committee.

From 1 July, Tony Adams will join Warren Bird as Co-Head of Global Fixed Interest and Credit. Adams has worked in fixed interest and credit management at Colonial First State for the past eight years, and will continue to manage the global credit funds including Colonial First State Wholesale – Global Credit Income, which currently has a Morningstar Recommendation of 'Recommended', the firm indicating that it has begun recruiting for an additional senior team member.

In other Colonial First State people news, the firm has also appointed Darko Kuzmanovic as Senior Portfolio Manager, Global Resources, to work with David Whitten and Joanne Warner running funds including Colonial First State Wholesale – Global Resources and Colonial First State FirstChoice – Global Resources. Kuzmanovic worked previously on David W. Tice & Associates' Prudent Global Natural Resource Fund, on the Scudder Gold and Precious Metals Fund, at Deutsche Asset Management in global mining analysis and portfolio management roles, and in the mining industry.


Goldman Sachs JBWere rationalises product range
Goldman Sachs JBWere Asset Management has terminated a number of sector-specialist funds, and closed a number of nil entry options to new investment.

The fund manager said that it made the termination decision because of the funds' failure to reach meaningful sizes, and because of the "trend away from regional or sector based [sic] products". (Goldman Sachs JBWere is not withdrawing altogether from specialty funds management, however, as it has recently launched products such as Goldman Sachs JBWere European Equities Keystone, Goldman Sachs JBWere Asian Equities Keystone, and Goldman Sachs JBWere Food Feed and Fuel Keystone.)

Table 1 below shows the funds which have been terminated, and their launch dates and net asset sizes at 31 January 2008, showing that in most cases the funds had less than A$5.0 million in assets. Their profitability would therefore have been marginal at best. Goldman Sachs JBWere said that it expected to make the final return of income and capital to investors by May, and to complete the winding up by June. Investors who choose to transfer their money into another of the firm's funds will commendably not pay an entry fee. The terminations reduce the number of dedicated European managed funds on offer in Australia to 16; the number of Japan-specific funds to 13; and global technology funds to 14 options.

Table 1: Terminated Goldman Sachs JBWere Funds

Fund Name

Start Date

Net Assets A$m

Goldman Sachs JBWere Europe 5-Nov-99 4.67
Goldman Sachs JBWere Europe Wholesale  9-Nov-99 5.58
Goldman Sachs JBWere Fixed Interest Wholesale 1-Dec-96 5.77
Goldman Sachs JBWere Global High Yield  5-Nov-99 2.77
Goldman Sachs JBWere Global High Yield Wholesale 9-Nov-99 3.25
Goldman Sachs JBWere Global Technology 28-Jul-00 2.1
Goldman Sachs JBWere Global Technology Wholesale 1-Nov-00 3.43
Goldman Sachs JBWere Hedged Global Small Companies Wsale 26-Nov-03 9.75
Goldman Sachs JBWere Japan  5-Nov-99 1.8
Goldman Sachs JBWere Japan Wholesale 9-Nov-99 0.98

Source: Morningstar database

The firm has also closed Goldman Sachs JBWere Australian Equities NEF, Goldman Sachs JBWere Diversified Growth NEF , and Goldman Sachs JBWere International NEF to new investment. Nil entry fee options, introduced in the 1990s with generally higher ongoing fees, have on the whole attracted relatively small amounts of money – these three Goldman Sachs JBWere funds had only A$9.41 million in combined assets at 31 January 2008, for instance.


Integrity hires former UBS dealer
Sydney boutique Integrity Investment Management, founded last year by former UBS Head of Australian Equities Paul Fiani, has hired a specialist dealer. Janet Montagu, a former colleague of Fiani's from UBS, will work from April in portfolio implementation with Chief Operating Officer Karen Thompson. Montagu will contribute to the management of Integrity Australian Share, whose major stockholdings from a 33-stock portfolio at 29 February 2008 included BHP Billiton (7.04 percent of portfolio value), Woolworths (6.94 percent), Rio Tinto (6.06 percent), and St. George Bank (5.00 percent).


RREEF loses Property Portfolio Manager
RREEF, Deutsche Asset Management's property and alternatives arm, has announced that property securities portfolio manager Philip Cheetham is leaving the firm "to pursue a new opportunity outside of the Asset Management [sic] industry". Under the supervision of now Singapore-based Danny Ekins, Cheetham has with Ross McGlade been responsible for running RREEF Paladin Property Securities. RREEF has indicated that it has begun looking for a replacement for Cheetham.

In our most recently-updated report on this strategy, published in February 2008 when we downgraded our Morningstar Recommendation from 'Recommended' to 'Investment Grade', we commented that the reduced focus from the lead manager, a swollen assets base, and changes to the investment team meant that RREEF was no longer among our most favoured listed property strategies. Cheetham's forthcoming departure reinforces that opinion.