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FE 2019 Alpha Managers list sees 54 new entrants

5 March 2019

Research group FE reports “a big churn of talent in the 2019 FE Alpha Manager rebalance”, with 54 managers joining the ranks and 52 losing their FE Alpha Manager title.

The FE Alpha Manager ratings highlight the top 10 per cent of UK retail-facing managers based on their performance throughout their entire careers. This year, 200 managers have an FE Alpha Manager rating.

Of the 54 new entrants (see list below), 38 have never previously been awarded an FE Alpha Manager rating, such as Bryan Collins of Fidelity, Jack Barrat of Man GLG and JP Morgan Asset Management’s James Elliot.

Rob Gleeson, head of FE research, commented: “The FE Alpha Manager rating allows us to take a step back and remove short-term market movements or cyclical factors from the analysis. Given the market conditions of recent years, partly down to ongoing Brexit uncertainty, it is fundamental that fund managers can add value over the very long term and ride the challenges the market throws at them. The FE Alpha Manager ratings enable us to separate those managers that can and cannot do this.”

FE reported that the top sector this year is the IA Japanese Smaller Companies with the highest percentage of FE Alpha Managers (57%%). No managers from the IA Short Term Money Market, IA UK Direct Property and IA Volatility Managed sectors received a rating.

Gleeson added: “The volatility in 2018 has had an impact on these figures, even with the long-term focus of the rating. It’s not surprising that sectors that typically have a high average active share have the most FE Alpha Managers, as there was opportunity for the right active strategy to do very well through this period.”

Top Groups

The top group for 2019 is Blackrock, with 10 FE Alpha Managers, up from six a year ago. Group winners last year, Fidelity, drop to second place with nine FE Alpha Managers  ̶  down from 10. First State Investors, with eight FE Alpha Managers, come in third place.

Comgest Asset Management managers enter the list this year for the first time, following their funds being made eligible for sale in the UK.

List of the top 10 Groups by number of FE Alpha Managers (click image to expand)

 

New entrants and leavers

FE reports 54 new entrants this year and 52 managers who have lost their FE Alpha Manager status, with just over half (27) of these losing their rating due to non-investment related reasons, such as retirement.

Charles Younes, research manager at FE said: “Several managers with a focus on smaller companies have lost their place. This is reflective of the underperformance of smaller companies compared to large caps since Brexit. Managers with a preference for smaller companies have been struggling to generate Alpha across the board.”

FE will announce its Hall of Fame Managers (those who have been awarded an FE Alpha Manager Rating for seven consecutive years) and the nominees for the FE Alpha Manager awards in May ahead of the FE Alpha Managers 2019 award ceremony on May 16.

How the FE Alpha Manager Ratings are ranked

FE examines fund managers’ 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.

New Alpha Managers, with those receiving the award for the first time in bold (click image to expand)

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