Fund managers are of course never wrong, they are just “early” and will in time be proved right by events.
That may be the consolation being sought by investors in the £2.2bn Janus Henderson Strategic Bond fund, the manager of which, John Pattullo, is retiring to spend more time with his golf clubs.
Janus Henderson Strat Bond also happens to be the second most-owned fund of its type among the allocators we cover.
The underperformance is primarily a consequence of Patullo and his colleague Jenna Barnard being long on duration as they expected rate cuts sooner than they happened.
In fact the fund's exposure has been gradually increasing over the past 12 months and is now beyond 10 years.
That has led to stark performance issues, with the fund losing 17 per cent over the past three years, compared to a loss for the peer group average of 2 per cent.
This might trigger memories of a certain Mike Riddell at Allianz who also ran a fund with a duration beyond a decade.
But the fund remains more popular than Allianz Strategic Bond despite the performance issues, appearing in five of the portfolios we monitor - but this has fallen from seven over the past 12 months.
A key distinction between the two funds is that Janus Henderson has an allocation which is much more "normal". Riddell had allocated 84 per cent of his fund to government bonds but the Janus Henderson fund only has 36 per cent here with another 47 per cent in corporate bonds and some exposure to asset-backed securities.
Of course, with a rate cutting cycle now likely happening, it may be that Pattullo’s fund goes on a prolonged run of strong performance, but if so, the beneficiary will likely be Barnard, the long-time co-manager on the fund and now sole head of the team.
