Portfolio manager change doesn’t always mean disruption

Also Interesting

• Global markets and multi-asset portfolios
• Understanding China’s Economic and Market Developments: Managing China’s Transition Into Global Benchmarks
• Global Equity Ratings

Change is inevitable in the asset management industry. The fact that fund managers will move companies or retire is well established. The key is how manager transitions are dealt with, which will have an important bearing on the effect on clients and their portfolios. In the single or ‘star manager’ system, transitions can be extremely disruptive. When a manager retires or leaves a firm or a fund, portfolios can undergo dramatic changes in approach, holdings and risk characteristics under the new leadership. This requires clients and their advisors to re-examine their original choice of investment. They need to review how the new approach fits with their requirements, and potentially will be forced to make changes – with inevitable implications in terms of risk, time and cost.