Mr Young, who has been suspended from work, has been helping Imro, the fund managers' regulator, unravel what happened to the Morgan Grenfell European Growth and Morgan Grenfell European Capital Growth funds, the two trusts he managed.
One financial adviser, who would not be named, was yesterday telling his clients, many of whom contacted him as well as Morgan Grenfell, that Mr Young "has retired due to ill-health". It is believed this information was passed to him by company sources.
Mr Young was described by his colleagues as a hard-working and conscientious fund manager.
Married with two children, he has in the past impressed observers with his fund management style. In June, he was awarded the prestigious European Investment Manager of the Year award by Investment Week. Morgan Grenfell scooped a separate award as Fund Manager of the Year.
Lawrence Gosling, editor of Investment Week, said: "My experience of him is that despite the fall in the value of the funds he managed, there was no sense of panic at all. He told us that he expected it to happen and had extremely good reasons for it. Either he was very cool or he was a consummate liar."
An Oxford University mathematics graduate, Mr Young joined Equity & Law, the life company, in 1980, in order to train as an actuary. Two years later, before completing his training, he switched to the company's fund management side, where he rapidly rose through the ranks.
One former colleague, who worked with him for several years, said: "He was very competent, liked by those whom he worked alongside, and he took his investment responsibilities here very seriously. He was very diligent. I am very surprised to read of what happened."
Mr Young, who even then specialised in European equities, was headhunted in 1990 to join Mercury Asset Management, which he left two years later for Morgan Grenfell.
He joined the European investment team at Morgan Grenfell Asset Management, which has pounds 70bn under management. MGAM, which is headed by Keith Percy, operates through five separate subsidiaries, including the international division. The international division is headed by Glyn Owen, and has about pounds 10bn under management. Mr Young directly managed about pounds 1.25bn in assets on behalf of more 70,000 investors, while a further pounds 133m was in the other suspended fund, Morgan Grenfell Europa.
Since being bought by Deutsche Bank in 1989, Morgan Grenfell has gradually drawn closer into its German parent's orbit, culminating in the announcement two years ago that all of Deutsche Bank's investment banking activities would be moved to London. The company now employs 7,500 people world-wide, 3,000 of them in London.
In the past year, Deutsche Morgan Grenfell, as the company has renamed itself, has acquired a reputation as one of the most aggressive operators in the City. Earlier this summer, it hit the news for allegedly poaching staff from its rivals, most notably ING Barings after the Dutch bank suffered dozens of staff defections to DMG.