Highly regarded UK equities manager Rosemary Banyard has taken the helm of a new fund at asset manager Sanford DeLand, which also runs CFP SDL UK Buffettology (GB00BKJ9C676), a fund that aims to invest like high-profile US investor Warren Buffett.
Ms Banyard's new fund, CFP SDL Free Spirit, will invest in UK businesses with the potential for growth and income using a similar approach to CFP SDL UK Buffettology. That fund has returned 99.3 per cent since launch on 28 March 2011, compared with 39.6 per cent for the Investment Association (IA) UK All Companies sector.
CFP SDL Free Spirit will also focus on well valued stocks with the potential for significant upside, and aims to return consumer prices index (CPI) inflation plus 2 per cent a year on average over a minimum of five years. The ongoing charge over the first year is estimated to be around 1.68 per cent - considerably higher than that on a typical open-ended fund of less than 1 per cent.
Ms Banyard left Schroders in March 2016 after 18 years and was latterly co-head of Schroders' pan-European mid- and small-cap team, alongside Andy Brough. She jointly managed Schroder UK Smaller Companies (GB0007220360) between 1998 and 2016, and Schroder UK Mid Cap Fund (SCP) from 2003 onwards.
Between 1998 and her departure in March 2016, Schroder UK Smaller Companies returned 452.5 per cent, easily beating the IA UK Smaller Companies sector average. Schroder UK Mid Cap generated 695.8 per cent between 1 January 2003 and the end of March 2016, against 237 per cent for the Association of Investment Companies UK All Companies sector.
Ms Banyard has built up a reputation as a cautious investor with a strong focus on company valuations and fundamentals. The new fund will be more concentrated than her previous ones, with just 25 to 40 stocks. Schroder UK Smaller Companies has more than 100 holdings and Schroder UK Mid Cap has 67.
Analysts think CFP SDL Free Spirit could differ from the funds Ms Banyard has run in the past in terms of return and profile.
"Ms Banyard is an experienced fund manager and takes a more cautious approach to investing, which should work well with the Sanford DeLand investment philosophy," says Adrian Lowcock, investment director at Architas. "But moving from a big house such as Schroders where resources were plentiful could impact on the ability to deliver. In addition she will not be working with Andy Brough, who tends to be a more adventurous investor. It will be interesting to see how performance is affected by these changes, but I would suggest investors initially watch from the sidelines."
Jason Hollands, managing director at Tilney Bestinvest, says: "Rosemary Banyard has produced very good numbers over her career as a manager focused on UK smaller companies and mid-caps. But with any manager who has spent a very long time at a large institution such as Schroders, which has a considerable research analyst resource, it is difficult to know how much of the past success is down to the manager's personal judgment or the support behind them.
"The leap from big institution to a tiny boutique could prove highly liberating, but it could equally be a challenge for a manager used to getting easy access to company management teams and with a lot of infrastructure behind them. Given this and the slightly different mandate on the new fund compared to those she managed at Schroders, I would wait to see how things shape up before contemplating an investment in the new fund."
Morningstar, meanwhile, says investors in Schroders' UK small and mid-cap funds could suffer following Ms Banyard's departure: "Despite the experience and continuity provided by Brough, Banyard's departure represents a significant loss of experience for the team. We also feel that the funds benefited from the contrast between Brough and Banyard's investment styles, with Banyard's more-risk-averse approach and valuation focus providing a natural counterbalance to Brough's greater appetite for risk."
