Morningstar has put Magellan’s global and high conviction funds under review following the unexpected announcement from Douglass.
On Monday, Magellan announced Hamish Douglass was taking a leave of absence from his roles as chairman and chief investment officer after a period of intense pressure and focus on both his professional and personal life.
Just hours later, Morningstar issued a statement noting that “given Douglass’ integral involvement in the business and managing Magellan’s global equity strategies, we have placed the Magellan Global and Magellan High Conviction strategies Under Review”.
“Key man risk has been an ongoing issue for the global equities strategies, although we note there is considerable depth of talent at Magellan that hasn’t been as visible to the public eye,” Morningstar said.
“A formal review of these strategies, including a comprehensive parent review, will be undertaken in the coming weeks and our updated view will be published soon after.”
Magellan’s share price suffered on Monday, diving to $16.50 on the back of the news.
The fund manager has had a tumultuous few months, culminating with the announcement in December that UK wealth firm St James’s Place had pulled a $19 billion mandate.
Days earlier, Magellan was rocked by the abrupt resignation of its chief executive Brett Cairns for personal reasons, an event that at the time topped off an earlier triggered downward spiral of its share price.
Maja Garaca Djurdjevic
Maja's career in journalism spans well over a decade across finance, business and politics. Now an experienced editor and reporter across all elements of the financial services sector, prior to joining Momentum Media, Maja reported for several established news outlets in Southeast Europe, scrutinising key processes in post-conflict societies.
