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Rathbone plots success

With just £200m under management, Rathbone Unit Trust Managers barely makes it into the top 100 fund managers in the UK. In 98th place, it is about £16.3bn in funds behind top-placed retail provider Fidelity.

But the Autif rankings do not tell the whole story. After a year in which Rathbone doubled funds under management, it boasts some of the best performance figures in the industry and plans to launch a seventh fund this spring.

The company started under the name of Laurence Keen in 1989 and was bought by Rathbone&#39s investment bank 12 years ago. After more than a decade of slow growth, current managing director Peter Pearson-Lund was hired in 1999 to help put the company on the map. After a name change to Rathbone Unit Trust Managers and a degree of persistence, the results are beginning to show.

Having worked in a similar capacity at Henderson in the early 1980s and then Gartmore, Pearson-Lund is an old hand at raising fund managers&#39 profiles. If the success of his previous two employers is anything to go by, Rathbone is on course to be one of tomorrow&#39s big names in the UK investment industry.

Pearson-Lund says: “I have applied the same strategy with Rathbone as I did at Henderson and Gartmore. The key is having a team of really able people behind you. I wanted to be sure we prepared and clearly wrote up our investment process. That is our bible and it helps IFAs understand how we have done what we have.

“I believe there is a demand from IFAs for smaller fund management groups because we really want to add value to the service we provide to our customers. Remember, this is how all the bigger businesses started.”

Rathbone&#39s business has been largely built on sup- port from the IFA market although around 30 per cent also comes from private-client business.

Pearson-Lund stresses that Rathbone&#39s private-client managers are not obliged to buy Rathbone&#39s funds but recent performance has made them an obvious choice.

Rathbone&#39s performance is certainly impressive. Of its five funds with a three-year track record, all are in the top quartile while four of its six funds are also top quartile over the past 12 months.

Its weak link over the past year has been the technology fund, which has had a harder time than most. Launched in May 1999, it was down by over 30 per cent at the start of February. However, it still has an A rating from Standard & Poor&#39s Fund Services.

The loss of UK smaller companies manager Roger Whiteoak at the start of the year was another blow for Rathbone. The fund has been one of the best performers in its sector and it is yet to be seen whether Whiteoak&#39s replacement, Carl Stick, can maintain the fund&#39s status.

Rathbone&#39s next product, the global companies fund, is set to start in April and will be run by Hugh Priestley and a new manager who is yet to be chosen.

Priestly has provided the backbone to Rathbone&#39s fund management, currently managing its capital growth, income & growth, technology and UK smaller companies funds.

However, Rathbone believes in fostering new talent and has several younger members of its team which it is looking to train to become tomorrow&#39s stars.

Although it has yet to become a mainstream brand in the IFA community, Rathbone has several more plans up its sleeve. Pearson-Lund says the firm is looking at signing up to a fund supermarket and it recently teamed up with companies such as Close Fund Management and Liontrust for an IFA roadshow. Although it has a way to go before it catches up with giants such as Fidelity, the early signals are positive.

Simpsons partner Andrew Merricks says: “They have got good solid performance and they are a smaller company which I like because it allows the managers a bit of individualism. None of their funds are monster funds that cannot move quickly, which is another reason why we like them.”


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