Star UK fund manager Neil Pegrum, who last week left Insight Investment after less than 18 months, is set to manage both a hedge fund and a long-only portfolio for his new employer Cazenove Fund Management.
Pegrum, who had spent 15 years at M&G, is due to run a focus fund for Cazenove when he joins in July, similar to the £60m high alpha UK dynamic portfolio he managed at Insight. The multi-cap Cazenove fund, which the firm is designing for him, will hold between 25 and 40 stocks and, as with the UK dynamic fund, will have a bias towards small and mid-sized firms.
In line with Cazenove's preference for managers to run long-short portfolios alongside their long-only funds – a policy recently applied to Tim Russell and Chris Rice – Pegrum will also have a hedge fund launched for him later this year.
The performance of that fund – as well as the long-only portfolio – will be closely monitored following Pegrum's success at Insight. The UK dynamic fund is up by 85 per cent over the past year and it is ranked second out of 325 funds in its sector. Deputy manager Andrew Cawker will be in charge of the fund until Insight finds a replacement.
IFAs believe that the firm will need to secure a major hire as Pegrum was considered to be the group's only high-profile fund manager.
Insight managing director business partnerships David Norman says: “Unfortunately, Neil is leaving. We will continue to employ him until the end of his notice period, which is three months, but he will not be in the office.”
Alan Steel Asset Manage-ment consultant Alan Adam says: “Insight will have a real credibility problem if it does not get someone big. It had really trumpeted the fact it had got him and no one else there is a big-name manager.”