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OBSR removes ratings on ex-Bolton, McLean and Miller funds

OBSR has downgraded a successor fund to Anthony Bolton’s Fidelity Special Situations, as well as funds run by Colin McLean, the managing director of SVM, and Bill Miller, the chairman of Legg Mason Capital Management.

McLean’s £32.7m SVM global opportunities fund, Jorma Korhonen’s £1.7 billion Fidelity global special situations fund and Miller’s £78.5m Legg Mason US equity fund have been removed from OBSR’s ratings service.

Miller outperformed the S&P 500 index every calendar year for 15 years until 2006, since when he has underperformed.

McLean’s fund, which is co-managed by Donald Robertson, outperformed until 2008, when some of its smaller holdings became less liquid and plummeted in value.

Korhonen has run the global special situations fund since Bolton’s special situations vehicle was split into UK and global special situations funds in 2007.

It lost its A rating and was removed from the OBSR service as the scale of underperformance since 2007 has caused “conviction to wane”.

Commenting on the SVM global opportunities fund, which was previously rated AA, OBSR says: “The managers aim to achieve above average capital growth over the medium to long term and outperform the FTSE World Index.

“Given changes in the investment landscape for their universe of investments since 2008, OBSR no longer has conviction in their ability to achieve this. Consequently OBSR believes the fund no longer merits inclusion in the service.”

The Legg Mason US equity fund was taken from the ranking due to “the scale and duration of the fund’s underperformance”. OBSR adds that the appointment of Sam Peters as a co-manager in November 2010 is “an interesting development”, but not one strong enough to allow the fund to maintain its former AA rating.


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