European Champions in a League of Their Own; from an Unsung Hero to a Wannabe Songwriter, Stars Generating the Best Returns for Investors in Continental Funds
Prestridge, Jeff, The Mail on Sunday (London, England)
Byline: JEFF PRESTRIDGE
MENTION Adrian Farthing to most unit trust investors or financial advisers and you would be met with a blank stare. 'Never heard of him,' would be the response nine times out of 10. 'But I know his sister Penny.' But Farthing, a quiet 34-year-old married man with a five-month-old daughter, Rebecca, is one of the country's top European investment stars.
According to citywire.co.uk, the financial website, Farthing has generated the fifth-best returns for unit trust investors in Europe over the past three years (see Page 35).
These returns, which average 1.7014 per cent per month, are better than 37 of his peer group, many of whose European funds have been hyped by sales-hungry marketing departments. They are also nearly double those available from investing in the FTSE World Europe (excluding UK) index, the yardstick by which most European fund managers judge themselves.
With such stellar performance, why have Farthing's investment skills been hidden for so long?
Farthing manages two European funds, Old Mutual European and Old Mutual European Blue Chip, which, paradoxically, have appalling performance records.
Over the past three years, they are ranked 85th and 88th respectively in their 88-strong sector, track records that hardly make them hot buys. Yet these performances do Farthing little justice because essentially, they are not his.
Farthing joined Old Mutual as head of its European desk only last September and so has had less than six months to turn them around.
It is only when the performance track record he left behind at Hill Samuel European is taken into account that the true extent of Farthing's Midas touch is revealed.
Highlighting the true stars of the unit trust industry is the objective behind Citywire's new Funds Insider Database. By tracking the personal performance records of fund managers within key trust sectors such as Europe and North America (see overleaf), Citywire believes it can identify which star managers investors should follow.
In the [pound]30 billion European unit trust universe, Citywire's David Smith says that Farthing is one of 33 fund managers who has managed to generate average monthly returns over the past three years in excess of the FTSE World Europe (excluding UK index).
By comparison, nine managers have failed to match the index.
Smith says: 'Good European fund managers have greater scope to shine than UK managers because continental European stock markets are not as efficient as the UK's. This means they have more opportunity to spot shares that are undervalued and due a re-rating.' Below, Financial Mail speaks to some of the top European fund managers pinpointed by Citywire. Profiles of Financial Mail's 'famous five' are given, right.
Jupiter European Situations FORTY-two-year-old Richard Pease, who learned his trade at the Church of England and Windsor Life before joining Jupiter in 1989, is the country's number one European fund manager, according to Citywire.
For most of the past three years, chess-loving Pease has managed both Jupiter European Situations and Jupiter European unit trusts.
Pease says he looks for four things when analysing firms - 'businesses that are special, have exceptional management, a strong financial position and a sensible valuation'.
Mark Dampier of Bristol-based adviser Hargreaves Lansdown says: 'He is best when running a small European fund, which allows his stock-picking abilities to shine through.' Pease will have the opportunity to manage a new European fund from
scratch in July when he joins New Star Asset Management. Dampier says he will have no hesitation recommending Pease's new fund. 'He is a winner.'
Old Mutual European Old Mutual European Blue Chip
FARTHING could be a star of the future as well as the past, according to Dampier. …