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manager change was in shareholders’
best interests, even though de
Uphaugh also possessed a value
style and had to contend with recent
performance struggles of his own.
This is one of the more high-profile
examples among a growing trend of
investment trust boards taking action
in the interests of shareholders. The
European Trust also recently axed
Edinburgh Partners as manager in
favour of Baillie Gifford, and Jupiter UK
Growth is reviewing its future following
poor performance under manager
Steve Davies. Meanwhile, the board of
46%
of trusts have had the same asset
manager for five years or more
20 / 21
“It is vitally important
that a board understands
a manager’s style and
doesn’t react to periods
of underperformance
that might be in line with
expectations”
European Opportunities has decided
to follow former Jupiter manager
Alexander Darwall to his new firm.
What has been the trigger for
this upsurge in activity? The
board of Woodford Patient Capital
was criticised for failing to act
independently until it was too late and
this will have sharpened the industry’s
focus. However Ryan Hughes, head of
fund selection at AJ Bell, says it was
the FCA’s Asset Management Market
Study in 2016 that laid the groundwork
for a renewed focus on independent
directors and their duties.
A long-term approach?
While these moves seem positive
for end investors, how does this
square with the need for a long-term
investment approach? Are impatient
boards damaging investor outcomes
when they don’t allow a manager’s
style to play out over a market cycle?
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