When looking to invest savings in the stock market we all want to do so with a reliable fund manager who will maximise our returns. But with more than 2,000 funds available to UK investors, where do we begin the search to find the best managers?
Investors need to beware of those managers taking exceptional risk for flash-in-the-pan returns, as in the long-run the money might do better in a tracker fund. A great active manager will perform in rising and falling markets, avoiding potential pitfalls by keeping our money in the most lucrative stocks.
Competition to recruit such managers is intense, and many move around rapidly for increased salaries or better perks. As such, if a manager boasts an impressive three- or five- year track record, this may be down to the skill of his predecessor. Choosing the best really is not easy.
The managers collected here are among the best UK investors currently have to choose from. They have weathered storms and grown their investors' money without taking excessive risk. If you are searching for the best, these are a good start.
PHILIP WOLSTENCROFT, ARTEMIS
Who is he?
Philip Wolstencroft, 39, is manager of the £1bn Artemis European growth fund.
I'd prefer to invest in the UK Shame. His fund has returned 133 per cent in three years, and financial advisers recommend diversifying your portfolio.
How does he do it?
Wolstencroft's analytical tool, which he devised and built to track the information from 2,000 analysts, economists and brokers on a daily basis.
Can he ever switch it off? He can ignore the computer's suggestions if he disagrees. He excluded British Airways from his portfolio because of its pension issues, although the computer wasn't happy.
I still don't like it You should do. The computer forms the basis for Wolstencroft and his team to discuss ideas from Europe's massive range of stocks. Its presence can also reassure investors that their money is secure.
Apart from building psychic computers, what else can this chap do? He is a cyclist. He also flies planes.
PATRICK EVERSHED, NEW STAR
Who is he?
Runs New Star's £172m Select Opportunities fund.
Style? The ultimate "contrarian" investor.
What does that mean? Evershed, 64, never follows the crowd. Before joining New Star, he pulled out of technology at Rathbones before the sector crashed. His fund is up 93 per cent in three years, beating the sector average by 20 points. His long-term record for avoiding stock-market euphoria also stands out.
Isn't it sometimes fun to get carried away? Of course, but Evershed's hardly unexciting. His fund is more volatile than some because it invests in about 160 stocks. Some go well, some go badly; but when they perform, rewards are substantial.
Is he still on the ball?
Evershed's timing remains remarkable. His performance suffered last year as the market for smaller companies dipped, but he now expects to be rewarded for continued support of the sector.
CARL STICK, RATHBONES
Who is he?
Carl Stick,36, manager of Rathbone's £680m Income fund and the Rathbone £214m special situations fund.
What's the story? The Rathbone income fund is up 73 per cent over 5 years, beating the industry average of 33 per cent almost threefold.
How does he do it? By investing in stocks for maintainable income without neglecting capital security and growth.
Is that it? In a nutshell. The fund has been top quartile over the last six years and Stick is building a track record to be proud of. He also took on the considerable mantle of Patrick Evershed's special situations fund in 2002 when Evershed left, and has continued to deliver strong performance of 108.5 per cent over three years.
Fund managers are just good at with numbers. He's probably dull to talk to?
Stick seems to be able to turn his hand to anything, having worked as a chef for King Hussein of Jordan for three years.
He also completed the last two London Marathons.
PHILIP GIBBS, JUPITER
Who is he?
Philip Gibbs, 47, is manager of Jupiter's £684m financial opportunities fund.
Gibbs has built his reputation as a financials wizard over nine years since joining Jupiter. His fund has returned 114 per cent over the past five years and he expects it to do even better.
How do we know? He has ploughed a good deal of his own money into the fund. When someone is willing to risk millions of their own in a fund, it is easier to appreciate their positive outlook.
Good news for high street banks, then? Not really. The fund is poised to perform well in all market conditions. The fund can invest in stockbrokers and investment banks when the market is rising, or property companies which tend to do well when the economy is weaker.
But financials are a bit niche, aren't they? Gibbs' global investment approach seeks out new stocks and will adopt sizeable positions anywhere money is to be made - hardly a niche strategy.
Any other interests?
He likes architecture.
NEIL WOODFORD, INVESCO PERPETUAL
Who is he?
Head of investment at Invesco Perpetual and manager of its £4.9bn high income and £2.6bn income funds.
That's a lot of money he's running. Woodford, 45, is regarded as one of few fund managers in the UK capable of running such an amount of money. His performance tends to back up that view .
Cool under pressure?
Absolutely. His rational approach has brought returns for his two funds of 67.5 per cent and 67 per cent respectively, against his peers' average of less than half that.
Very clever. But what makes Woodford so good?
Long-termism. He looks to invest over a three- to five-year term and never jumps on a bandwagon. He predicted the slowdown in the UK housing market, for example.
A sense of perspective helps? He works calmly by the river in Henley, away from the City. He's been at the firm for 15 years and seems content to stay another 30.
How does he stay so calm? By walking his dogs, cycling and playing rugby.
HUGH YOUNG, ABERDEEN ASSET MANAGEMENT
Who is he?
MD of Aberdeen Asset Management's Asian operation, based in Singapore.
What is he like? A hands-on fund manager, Young, 47, moved Aberdeen's Asian operation to Singapore in 1992 in the belief that his research efforts would benefit from being on the ground.
Did it work? You could say so. His £883m Aberdeen Far East Emerging Economies fund is up more than 107 per cent in five years, more than double the sector average. His Asia Pacific fund is up 86 per cent in the same period.
Isn't Asia too big for one man to handle? Young is supported by a team of analysts in offices across the region, grilling the managers of 800 companies last year.
So he's not running his funds single-handed then?
Young's role is often that of overseer, checking his team's work and cross-examining their conclusions. He also continues to visit firms himself. He demands the highest standards from companies he invests in and those he works with, and is ruthless with the proverbial knife.Reuse content