Malcolm Murray has to follow one of the biggest acts in the fund management business, taking over from SG Asset Management founder Nicola Horlick who has let go of the reins of her funds to concentrate fully on the running of the business.
Murray has been at SGAM for just 18 months as the company has built up the fund management team so that Horlick was able to concentrate on strategy.
SGAM has become known for the flair and individuality of its fund managers and Murray has strong views on what makes a good fund management house. He does not put much credence in massive research departments or comprehensive analysis, believing the buck stops with the managers.
“Research and analysis serves a purpose but when you are too firmly tied to an analysis team, fund managers are not able to move as fast as they sometimes should. You need a solid base but as a fund manager you need to be fast moving, with flair, not tied down to a cumbersome system.”
He believes in the house style at SG, saying that is similar to styles he has used in the past but with a much wider world view. Many value houses, which has been his mainstay style, have become too value-focused for him.
“Here, we buy quality. We put value and timing on top of quality, which I think means we are able to look more closely at what you should do with your stock when it reaches a certain price at a certain point in time. I am happier with this as a more refined way to stockpick.”
It is a style that 38-year-old Murray believes has the flair and innovation of a boutique coupled with the security and reliability of a big parent company. Since arriving at SG, he has become a keen supporter of the boutique system. “Look at the way that the large houses are performing. Some have been absolutely dismal, many others are simply stagnant. We have had comparatively good performance, our retail funds, for instance, have been doing a bomb.”
He believes most fund managers today are too middle of the road and this has come from being entrenched in and hampered by big house style. “They are far too conventional. The game has moved on but the big houses are notoriously slow at working this out.
“Most fund managers don't have any understanding about absolute value, all they are interested in is relative value,which does not give you a complete understanding of how a stock will perform.”
He has noticed another industry change. “Of course, many people made their names as fund managers in the big houses where there was the opportunity for names to be made. But the good guys are now all wanting to move to boutiques where there is a better quality of life and you have more control, both over your own working conditions and your funds.”
He believes that big firms have a tendency to destroy innovation. “Many people are simply tired of being restricted by big firm parameters that don't add value to the process.”
Murray says the move to SG has been a rewarding one. He considers that business is a team sport and he feels very comfortable in this team. “Colleagues have to have the confidence in each other that they can say something wrong without being judged or ridiculed for it. We are not frightened of getting something wrong because our individual and team track records speak for themselves.”
He is keen on team sports and uses football references to get his points across, likening individual stocks to players on a football team. “Some players can be solid midfielders but at times they have the strength and performance to move into a striker position. You just have to watch their performance and track record and know when to retire them or put them on the bench.”
Murray is a keen Glasgow Rangers supporter who has followed the team since he was a child. He also enjoys playing football and since 1994 has played in a South London amateur football competition.
The Scotsman has lived in London for most of his working life but says he still makes sure his family gets back to Scotland as much as they can to “get real values”. He has a cottage in the north of Scotland that he jokes is a “value investment that will come good in the long term”.
He takes pride in the fact that managing top-tier funds has not changed his outlook in life, saying he still drives an old £900 Ford Escort. “I love what I do and get great satisfaction out of it but there is much more to life than just work.”
However, he seems to be able to find inspiration and similarities between his work and most everything he does. He is a member of Woking Golf Club with a six handicap and reflects that in some respects playing golf is much like fund management. “It is a game of skill that is highly individual. You cannot blame anyone else for the mistakes you make on the golf course. If you make a bad shot, you simply have to assess where you are on the course and evaluate how to make a success of the position that you are in.”
Born: March 24, 1956.
Education: Dumfries Academy; Strathclyde University, BSC Maths& Economics.
Career: Martin Currie 1978-1980, Phillips Drew 1981-2001, SGAM 2002 to present.
Career ambition: “To build an asset management company that is wealthy, honest and wise.”
Life ambition: “To make my wife understand what makes shares move.”
Likes: Glasgow Rangers, fast golf greens, happy clients, Lou Reed, Metallica.
Dislikes: Materialism, pseudo socialists.
Drives: £900 Ford Escort, after my Mercedes was stolen with my golf clubs in it.
Peers say: “There is absolutely no pretence and clients respect that enormously. He is a real individual and a great fund manager.”