Pacific Horizon star manager quits Baillie Gifford for Crux

Ewan Markson-Brown, manager of the top-performing Pacific Horizon investment trust, leaves Baillie Gifford to join boutique Crux Asset Management.

Ewan Markson-Brown, lead manager of the top-performing Pacific Horizon (PHI ) investment trust, has resigned from Baillie Gifford to join boutique Crux Asset Management.

This is a blow for Edinburgh-based Baillie Gifford with the Citywire AAA-rated fund manager, who oversaw £5.2bn ($7.4bn) of assets, lining up new Asia and China funds to launch at Crux later this year.

Pacific Horizon, chaired by Angus Macpherson, has not yet responded. Markson-Brown’s departure is likely to mean co-manager Roddy Snell will become the lead manager as well as co-manager of the recently relaunched Baillie Gifford China Growth (BGCG ) trust he runs with Sophie Earnshaw.

Markson-Brown joined Baillie Gifford from Pimco in 2013 where he was senior vice-president for emerging markets. He took over Pacific Horizon the following year and established a strong reputation generating significant outperformance in three of the last seven calendar years, according to Morningstar data.

Last year saw him and Snell, who has also earned a Citywire AAA rating, deliver blowout returns with a ‘growth squared’ strategy of piling into smaller Asian technology disrupters after the pandemic crash.

This paid off handsomely with the now £700m trust delivering a total shareholder return of 129%, ahead of Baillie Gifford flagship Scottish Mortgage (SMT ), which made 110%, and second only to Baillie Gifford US Growth (USA ), which achieved 134% with a similar focus on internet growth stocks.

PHI also picked up a Citywire investment trust performance award last year.

Although the trust’s shares have moderated their advance this year, they remain top of the AIC Asia Pacific sector over one, five and 10 years with returns of 75.6%, 363% and 418%, the last two more than double the group average.

These shareholder returns have been backed by underlying growth in net asset value (NAV) of 74%, 97.5% and 335%, according to data from Numis Securities.

PHI, in which Baillie Gifford chief executive Andrew Telfer has a 0.9% stake, is the only trust in its eight-strong peer group to trade at a meaningful premium of 7% over NAV. 

Markson-Brown will remain in Scotland, setting up an Edinburgh office for Crux in September with another fund manager and two analysts expected to join shortly. He will be incentivised with an equity stake in the London-headquartered business founded by European fund manager Richard Pease. 

Crux’s new chief executive Karen Zachary will bank on Markson-Brown continuing his asset-gathering form to boost a business that has just £1.7bn of assets compared to the £317bn ($446.9bn) of Baillie Gifford. These are mostly in Pease’s TM Crux European Special Situations  and the TM Crux UK Special Situations fund of AA-rated Richard Penny

In the year to 31 May, investors poured £1.4bn into the open-ended Baillie Gifford Pacific fund he also ran with Snell, swelling its assets from £812m to £2.9bn. It too leads its sector over three years to 30 April with an 88.5% return, more than double the 32% average of the 165 funds in the category.

He also ran Baillie Gifford Emerging Markets Growth with Mike Gush and Andrew Stobart, overseeing a top quartile 46% return in the three years to April.

Crux will launch two funds in Luxembourg for Markson-Brown in the fourth quarter, one focused on Asia excluding Japan and the other on China. With these the manager will use his 20 years’ experience in emerging markets and Asia to continue spotting undervalued growth companies in the region.

Markson-Brown becomes the first big fund management hire by Crux since Zachary was appointed chief executive in October 2020. Before Pimco, he worked at Newton and Merill Lynch Investment Managers after graduating in Politics, Philosophy and Economics from Oxford university.

His arrival follows the appointment of Ashley Dale as director of international sales in March, who arrived from Cadogan Capital.

‘[Markson-Brown] brings great experience as well as an exemplary track record of value creation for investors in Asian equities,’ Zachary said.

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