New hires have yet to pay off for Scottish fund managers, but redundancies are unlikely

Fund managers do not subscribe to the hire-and-fire mentality employed by investment banks, and tend to give time for their new recruits to perform, which is a good thing in light of some recent results from Scottish firms.

In the past couple of days, two Scottish asset managers - Alliance Trust and Saracen Fund Managers - have reported interim results and, not surprisingly, they weren't great.

Alliance Trust's net assets fell by 7.5% in the third quarter, while Saracen's profits tumbled by nearly 60% year-on-year. The current volatile market conditions were cited as the key reason by both firms.

Perhaps significantly, however, both fund managers have investing in their staff over the last year, which could indicate a need to downsize in the wake of recent results. There's no indication of any shrinkage yet, however.

Alliance Trust has just unveiled plans to launch a Global Thematics Opportunities fund for its third-party business, having hired Illario Di Bon and Juergen Lanzer for its London-based global equities team in recent months. It has plans to build out its third-party business, Alliance Trust Asset Management, which saw inflows of 7.3m in the three months to the end of September.

Saracen, meanwhile, unveiled plans to move its head office from Glasgow to Edinburgh last year, and promised new hires. It says that it has made "a lot of investment in the business" and launched a new Global Income & Growth fund in June, which is overseen by chief executive Graham Campbell and head of research, Daniel Leaf.

We've mentioned previously that, generally speaking, most fund managers in Scotland have stalled recruitment recently, but even in light of the current conditions any redundancies seem unlikely.

Aside from the fact that Scottish Widows Investment Partnership has hired over 100 people over the last 12 months, headhunters also insist that the fund management recruitment landscape in Scotland is not entirely barren.

"Most fund managers in Scotland believe that, despite the current market conditions, they need to be positioned for the upside and continue to be open to the idea of new recruits," says Graeme Knox, director of fund management-focused headhunters the Knox Consultancy. "There a no big hiring sprees, and any decisions are made much more slowly, but after a prolonged period of inactivity, there are now indications that recruitment is on the cards again."