Henderson Global Investors and Fidelity Investments have triumphed in this year’s FE Alpha Manager ratings rebalance, with the two groups each boasting ten managers who have been awarded the highly coveted Alpha Manager status.
Key points:
- 189 Alpha Managers in 2016’s FE Alpha Manager list;
- Henderson and Fidelity top the board on group level;
- 47 new Alphas awarded;
- 12 women named Alpha Managers;
- 31 managers have lost their Alpha status;
- 3 returning managers
Some 189 managers have scooped an Alpha rating this year in the annual rebalance – up from 182 in 2015. This is despite the heightened volatility which has plagued investment markets over the past year – stemming from worries over China’s economic health, plunging commodity prices and a possible British exit from the EU.
Each year ratings and research firm FE recognises the top 10 per cent of UK retail-facing managers on their track records going back to 2000, with extra weighting for managers with the longest track records to highlight the benefits of experience. To determine the ratings, FE looks at a manager’s ability to create risk-adjusted alpha, outperformance in both rising and falling markets, and those who consistently beat their benchmarks.
Henderson and Fidelity lead the industry with ten Alpha Managers each, while Schroders and Jupiter follow with eight and seven respectively.
There are 47 new entrants to FE’s list of top-decile alpha generators (up from 37 last year), with three having returned to the list after exclusion last year.
David Coombs from Rathbones, Nigel Thomas from Artemis and Rosemary Banyard from Schroders all returned this year having lost their Alpha status in 2015.
Of the 47 new entrants, 39 have previously never been awarded an Alpha rating – the list includes rising stars Johanna Kyrklund whose largest managed fund is £5.2bn (co-managed), Blackrock’s Tom Holl (largest fund around £1.5bn) and JP Morgan’s Amit Mehta (largest fund around £1.4bn).
There has also been an increase in the number of women awarded an Alpha rating this year – with 12 now rated, up from ten last year.
Meanwhile, 45 managers made it into the “hall of fame” for consistently making the Alpha Manager list over the past seven years, up from 30 in 2015. Individual manager names will be revealed closer to the Alpha Manager Awards in April.
Mika-John Southworth, director at FE says: “These ratings are a quant-driven marker to help advisers and investors spot the best managers in the UK retail investment market.
“The ratings assess performance throughout a manager’s entire career, across all the funds they have managed, and are specifically designed to reward skill, consistency, alpha generation and downside protection.
“The purpose of the Alpha Manager rating is to take a step back and remove short-term market movements or cyclical factors from the analysis. It allows us to identify the managers who can add value over time – which is fundamental considering the market conditions we have been facing over the past year.”
On a sector level, the UK All Companies sector has the most Alpha Managers, followed by the Global sector (16) and UK Equity Income and UK Smaller Companies sectors (both 11).
This year also saw a considerable shake-up with 31 managers being taken off the Alpha Manager list: notable names (based on assets managed) include Polar Capital’s James Salter, Iain Stewart from Newton & BNY Mellon, and Adrian Frost and Adrian Gosden from Artemis Fund Managers.
