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Morningstar Fund Ratings: Weekly Round-up

ANALYST RATINGS: This week Morningstar analysts reveal new ratings for AllianceBernstein and downgrades for Jupiter and Fondita

Morningstar Analysts 9 April, 2019 | 12:24PM

New Ratings

AB Select Absolute Alpha - Negative

Francesco Paganelli

We have initiated coverage of AB Select Absolute Alpha with a Morningstar Analyst Rating of Negative. This US-focused long-short equity strategy is led by veteran manager Kurt Feuerman, who has around two decades of experience running similar mandates, having moved to AllianceBernstein from previous hedge fund firm Caxton Associates. Concerns about team turnover and uncertainties associated with tactical net exposure management, however, limit our conviction in the strategy. On top of these concerns, this fund is very expensive: while its ongoing charges are broadly in line with its peers, a 20% performance fee – with no hurdle rate and a high-water mark resettable every two years – has a highly detrimental impact on performance. 

Downgrades 

Jupiter European - Neutral

Jupiter European Growth - Neutral

Samuel Meakin

Jupiter has announced that Alexander Darwall will step away from the management of this strategy later in 2019. Following a transition period, Mark Nichols will assume the role as sole manager. Nichols was comanager of Threadneedle European Select alongside lead manager David Dudding, and he also has portfolio management experience prior to that from his time at F&C, but generally not in a sole manager role. Upon taking over here, Nichols will have the latitude to implement his own approach, and the exact shape the portfolio will take is not clear at this stage. Our previous positive view of this strategy was largely predicated on the experience of Darwall, and the consistency and stability he provided in implementing his proven approach over his lengthy tenure. As a result, we have moved the Morningstar Analyst Rating to Neutral from Gold.

Fondita Nordic Micro Cap - Bronze

Matias Möttölä

We have downgraded the Fondita Nordic Micro Cap fund from a previous Silver to a Morningstar Analyst Rating of Bronze. We still think Fondita Nordic Micro Cap has enough strengths to be an above average contender in its Nordic small- and mid-cap Morningstar Category over the long run. However, serious underperformance has led to considerable outflows and brought parent-related risks to the fore, and the managers’ quality of execution has not been at the level it once was. The fund’s fees remain high in its category. 

 

 

 

 

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Jupiter European Growth D GBP Acc19.62 GBP-0.70
Jupiter European I Acc2,578.33 GBP-0.59

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