Investec Asset Management has once again turned to Schroders’ multi-asset bench to strengthen its own investment team as the South African firm continues to focus on international growth opportunities.
The $ 109 billion manager confirmed in a statement on June 21 that Iain Cunningham joined the previous day as a portfolio manager. The move sees him once again team up with with former Schroders multi-asset colleagues Michael Spinks, now Investec’s co-head of multi-asset, and Justin Simler, an investment director in the team. Cunningham, who spent nine years at Schroders, joined Investec’s 30-strong team on June 20 and reports to Spinks.
David Aird, head of the UK client group at Investec, said: “We concentrate on building a firm base here and hope that people from the outside acknowledge that we could be an exciting place to work.”
Spinks joined Investec in 2012 after eight years at Schroders, while Simler switched in 2015 after just under a decade at the £325 billion manager Schroders. According to its 2015 annual report, published in March this year, Schroders runs £78 billion in multi-asset strategies.
Investec, meanwhile, runs some £14.6 billion in multi-asset funds across the firm, of which £6.8 billion is run directly by its multi-asset team, according to a spokeswoman. Its UK-domiciled Investec Diversified Growth fund, the team’s flagship fund, has assets of £1.4 billion, according to its May 2016 factsheet.
The fund, which is run by Spinks and Philip Saunders, aims to deliver gross returns of 5% more than the UK CPI index in the long term. It had, however, lost 6.3% in the 12 months to the end of May but had made annualised returns of 2.1% in the past three years and 4% in the past five years to the same date.
Financial News analysis of the DGF data tracked by analytics firm Camradata, which is part of investment consultancy Punter Southall, showed that less than 10% of UK DGFs had made positive returns in the 12 months to March 31, 2016.
Despite their recent performance challenges, DGFs remain popular with investment consultants, with money continuing to flow in. Aird said that Investec’s multi-asset products are now enjoying “traction” with global consultants who have “come in and spent many long hours with our multi-asset team”. He said that performance in general for the DGF sector should be judged on a five-year basis, and not by shorter-term issues in the past 12 months.
Investec’s multi-asset team launched a version of its UK DGF for the Australian market in 2015, and Aird said that there is demand from investors in continental Europe for an equivalent. In the statement, Spinks said Cunningham will “help to develop” the team’s capabilities globally. Investec also has multi-asset specialists in New York and Singapore. Aird said that no decision had been made on which funds Cunningham would work on directly at Investec, which runs approximately 24 multi-asset funds.
According to Investec, Cunningham co-managed the Schroders global multi-asset income fund, as well as its global multi-asset allocation fund. He also managed global tactical asset allocation mandates and helped build Schroders’ multi-asset income business.
Schroders confirmed his departure in a statement, adding that Aymeric Forest will continue to be the lead manager of Schroders’ suite of global multi-asset income funds supported by the multi-asset portfolio solutions team.