de mol van otterloo and lynch to take on european and european dynamic growth funds
Mark Pignatelli is stepping down as manager of Schroders European and European Dynamic Growth funds to assume the role of chief investment officer at the group.
The role of CIO at Schroders was previously split between David Gasparro, head of retail investment, and Susan Haroun, managing director of the global investment group.
Pignatelli will become fund director of the two European portfolios. He will continue to oversee the funds, so if any major change is made to the portfolios it will be discussed with him first.
Adriaan de Mol van Otterloo will take over as lead manager on the European fund and Andrew Lynch will take over as manager on European Dynamic Growth.
De Mol van Otterloo joined Schroders in 1996 on the European desk and now manages more than e500m in the Schroder International Selection fund, the group's Luxembourg Sicav, in which he manages the Italian equity, and Europe ex-UK equity portfolios.
Lynch, a European small-cap analyst, has been with Schroders since 1998 and has direct responsibility for the European segment of an institutional global small-cap portfolio.
Robert Higginbotham, retail marketing director, said: 'Pignatelli's strength is his understanding of investment processes, such as risk controls and asset allocation. He has a superb view of the totality of the investment process. His job now is to understand all-out processes and carry across best practice from one process to another.'
In his new role, Pignatelli, previously head of pan-European equities at the group, will liaise with the heads of the Schroders' investment desks and make sure the different investment processes are working across the board. Gasparro will make sure these processes work effectively on all the retail products.
Higginbotham said Gasparro's job will remain the same in that he will continue to make sure all the group's products deliver what they set out to do and monitor their performance with the different fund managers.
The performance on Pignatelli's European fund was severely affected when, 18 months ago, he made a call on the European Central Bank cutting interest rates aggressively in line with rate cuts in the US. This did not materialise, European investors became defensive and the fund suffered as a result. Standard & Poor's dropped the fund's AA rating to A after the fourth quartile performance that followed the decision.
In the April issue of Investment Week's sister publication, Fund Strategies, it was reported that Pignatelli, in making the top-down call that saw him weight the fund heavily in cyclicals, had veered from his stockpicking style.
This aberration in his management style has not impacted Schroders' decision to take him off the portfolios, Higginbotham said. Since joining Schroders, Pignatelli has improved the investment process on the European desk as a whole by placing emphasis on fundamental analysis, surprise and thematics.
He implemented the process by which a model portfolio is produced by the regional team from which all European portfolios are constructed. Schroders believes this strength can be taken forward to be used by the group as a whole.
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