Schroders Top Performing Small Cap Managers to Exit

Morningstar analysts have placed the Schroder UK Dynamic Smaller Companies under review following the news that Paul Marriage and John Warren are leaving the firm

Emma Wall 2 June, 2017 | 9:31AM
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Emma Wall: Hello, and welcome to the Morningstar series, "Ask the Expert." I'm Emma Wall and I'm joined today by Morningstar Analyst, Sam Meakin, to talk about fund manager departure at Schroders.

Hello, Sam.

Samuel Meakin: Hi, Emma.

Wall: So, two UK Smaller Companies fund managers leaving Schroders. What do we know?

Meakin: Yes. So, Paul Marriage and John Warren, who manage the UK Dynamic Smaller Companies Fund at Schroders, have announced that they will be departing to set up their own boutique investment firm and that is set to take place in Q4 of this year.

Wall: And they run two funds, don't they? They run an Absolute Return Fund, which they are taking with them, and they also run this UK Dynamic Smaller Companies Fund, which Morningstar analysts rate here. So, what has been the analyst reaction?

Meakin: Yes. So, we've placed the fund under review for the time being. We're sort of awaiting some more information from Schroders as to who will be taking over. I think it's quite likely that the strategy of the fund will change a little bit because Marriage and Warren had their own distinct process. So, we're king of waiting to see for some more news on that front. But in the meantime, we've put the rating Under Review.

Wall: And what was the rating before?

Meakin: The fund was rated Bronze and quite a bit of our positive view on the fund was on the basis of the managers' experience and their consistency and deftness in applying that process.

Wall: We do have quite a long lead time here thought, however. The managers are not leaving till the end of the year which should come as comfort for investors who are in this fund. I suppose the main thing is for investors to do as the analysts are doing here, wait and see until you have some more information. Don't act rashly.

Meakin: Sure. We don't see any immediate cause for concern for investors here because the fund is still managed by the same team at present and that will be the case for the next few months. So, no need to panic.

Wall: Sam, thank you very much.

Meakin: Thanks, Emma.

Wall: This is Emma Wall for Morningstar. Thank you for watching.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Schroder Tellworth UK Dyn Abs Rt P1€HAcc2.10 EUR0.05
Schroder UK Dynamic Smaller Coms A Acc4.66 GBP-0.32Rating

About Author

Emma Wall  is former Senior International Editor for Morningstar

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