ASI Global Smaller Companies – fund manager change

Harry Nimmo will step back as co-manager of the ASI Global Smaller Companies fund on 1 December 2021. Kirsty Desson, the fund’s existing co-manager, will assume the role as lead manager. The fund’s objective of delivering long-term growth by investing in what they believe to be the ‘big companies of tomorrow’ will remain unchanged.

After launching this fund in January 2012, Nimmo stepped back from his management duties in 2016 but returned to provide a steady hand after the departure of the co-founding manager, Alan Rowsell, in June 2020.

Whilst Nimmo will no longer be a named co-manager, he’ll remain part of the same team. He remains a passionate stock picker and this change will enable him to dedicate more time to company research and analysis.

Given how long Nimmo has managed funds, questions around his retirement are natural. However, at this stage he plans to continue working for several years and will remain an important member of the team, feeding into discussions and contributing stock ideas from the UK and US. He will also remain a manager of his UK smaller companies’ strategies and global mid cap fund.

Why this manager change?

Nimmo has been in the industry for almost four decades and has built up an enviable track record investing in smaller companies. He has gradually been reducing his responsibilities in recent years with succession on the horizon. For instance, in early 2020, he relinquished his position as Head of Smaller Companies which was passed onto Andrew Paisley.

Desson has been co-manager of the fund since February 2020 and has over 20 years industry experience. Her career began at Martin Currie in 2000 where she analysed companies in Asia and emerging markets. In 2012, she joined abrdn (which was then Standard Life) to focus on smaller companies within Asia, including Japan and emerging markets. Over this time, she has built great analyst experience, been heavily involved in the fund and been instrumental to its success. Nimmo and abrdn have acknowledged this by promoting her to lead manager.

Our View

Fund managers come and go and it’s only natural to associate their departure with the potential for change. In this instance, we don’t expect much to change. Desson and Nimmo use the same investment philosophy and have worked together for the best part of a decade. Desson will continue to use the quantitative tool called the ‘Matrix’, which has helped the team to uncover some great smaller companies over the years.

We believe the investment process is repeatable and will continue to be used in the same way across the team. Each region has its own ‘pod’ of analysts and portfolio managers that contribute ideas for debate and consideration. This team structure will remain unchanged as will the quality of their ideas in our view.

We believe abrdn’s handling of Nimmo’s role change has been exemplary, providing us with notice and access to the data required to conduct our analysis. We have got to know Kirsty Desson well as an investor and met with her several times. She comes across as a knowledgeable and passionate smaller companies investor. We have also maintained contact with Nimmo to discuss the changes.

Desson has also managed a similar global smaller companies portfolio since early 2019, where we believe she has delivered growth primarily through stock selection. The shape of this portfolio, and its regional and sector allocations are aligned with the main fund. It has also provided some shelter in falling markets which we expect from the process. Although there are no guarantees this fund will perform in the same way.

Typically, we favour fund managers with an analysable track record of at least five years. Therefore, our sustained conviction is contingent on the continuity of the team and Nimmo’s ongoing contribution. Although he will no longer be a named manager, we take comfort knowing that his experience will continue to play an important role in stock selection, guidance and mentoring the next generation of smaller companies investors.

Nimmo has nothing but praise for Desson and her ability to successfully navigate the next chapter for this fund. We will continue to monitor her progress closely and review the situation whenever Nimmo does eventually retire.

For these reasons we will retain ASI Global Smaller Companies on the Wealth Shortlist.

This isn’t a recommendation to make any changes to a portfolio. Investors should make sure any investments match their investment goals and attitude to risk. If you're not sure if an investment is suitable for your circumstances, please seek advice.

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Past performance is not a guide to the future. Source: Lipper IM to 31/10/2021.

Find out more about ASI Global Smaller Companies, including charges

ASI Global Smaller Companies Key Information Document