Advisers fear a rush for the door as Roger Guy resigns
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Advisers expect further outflows and possibly a dilution levy following news this week that star Gartmore manager Roger Guy has decided to retire from day-to-day fund management.
The news was compounded further by the exit of chief investment officer Dominic Rossi and the announcement of a strategic review that may see Gartmore sold or merged.
Guy runs the flagship £3.5bn European large-cap team and is also responsible for around 30 per cent of the group’s profits. Earlier this year, it was reported he was unhappy at the departure of co-manager Guillaume Rambourg, suspended in March after an internal investigation. He left the firm in July.
Hargreaves Lansdown has cut Guy’s £187m European absolute return from its recommended Wealth 150, calling on investors to switch from the fund.
Hargreaves Lansdown investment manager Ben Yearsley says: “This fund is bound to be the hardest hit as he was still directly managing it. However, I do expect outflows across the range.”
The European absolute return fund had £280m of assets 12 months ago.
Chelsea Financial Services managing director Darius McDermott says Gartmore has “a highly skilled manager” in John Bennett to fill Guy’s boots. His firm has recommended a hold on the fund but he says redemptions are likely to follow.
He says: “This is a serious blow for Gartmore and I would expect to see reasonably strong redemptions, with Roger’s funds enduring the biggest bleed of assets.
“Investors who look to exit the Gartmore European absolute return are likely to see a dilution levy over next few days.”
Skerritt Consultants head of investments Andy Merricks says: “There will be a rush for the door as this is on the back of what happened to New Star. I would not rule out the possibility of lock-ins, which would be bad news for the industry in general.”
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