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Stockbroker’s onslaught at fund managers

Stockbroker Christows has fired a broadside at fund managers, claiming they get more respect than they deserve.

Head of fund research Dan Kemp says investors selecting a fund should assume the manager is no good to ensure that their judgement is not clouded by marketing material.

He also warns against relying on strong past performance as he says that performance nearly always proves inconsistent.

Kemp says: “Assume that all fund managers are idiots until proven otherwise. As figures of authority, fund managers command more respect than they deserve. Begin your analysis of the fund with an assumption that the manager is no good. This helps to avoid being bamb-oozled by marketing spin.”

But Resolution Assert Management sales and marketing director Jonathan Polin says: “The comments sound a little bit harsh. Good fund managers who can contin- ually outperform and make a significant premium ahead of what they are charging deserve what they are paid.

“It is down to the inter- mediaries to look at how fund managers are performing and to recommend the outperforming funds to their clients. If fund managers do not perform, they are penalised by having their funds taken away.”

Hargreaves Lansdown head of research Mark Damp-ier says: “It is only a very few per cent of fund managers who consistently outperform the market.

“Most fund managers are vastly overpaid for not del- ivering a great deal a lot of the time.”

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