Gartmore is looking to launch a range of concentrated portfolios in February next year for its best-...
Gartmore is looking to launch a range of concentrated portfolios in February next year for its best-performing fund managers, writes Robert Stock.
The concept, which was pioneered in the US by companies like Janus, is designed to give top managers a chance to outperform and, in an increasingly competitive environment, compete for inflows of cash. The range, which Investment Week understands would include a global equities fund as well as UK, European, Japan and US equity funds, would be based on portfolios with as few as 20 stocks.
It would allow Gartmore to more aggressively market the profile of fund managers such as Roger Guy who manages its frAA-rated £260m European Growth and frAAA-rated £1.9bn European Selected Opportunities unit trusts.
The range could also provide another vehicle for Gartmore's lead UK fund manager, Tim Gregory, who runs Gartmore's frA-rated £247.5m UK Growth & Income, frA-rated £331m UK Growth, and £213.1m UK Selected Opportunities unit trusts.
Guy's European Growth fund typically holds 75 stocks, according to Standard & Poor's, while Gregory's UK Growth holds around 100.
Gartmore confirmed to Investment Week that it has been testing the possibility of launching the focused funds on the market and said the response from the broker and IFA community had been encouraging.
However, Gartmore would confirm no details of the shape that the product range would take and said it had not yet decided to take the project to market.
Bambos Hambi, director of global equities at Friends Ivory & Sime, said the proposed range was similar to a trend in the US where asset managers compete for a very large proportion of retail money that seeks out only the top performing funds.
Hambi said: "If you analyse what is going on in the US, you will find that the top 20 performing funds are taking in a huge proportion of retail money. To be up there, a significant group of managers are running a smaller number of stocks and taking bigger bets."
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From 1 March