City veteran Terry Smith hands over emerging markets trust to new managers

City veteran Terry Smith is stepping back from his emerging equities trust as he hands over day-to-day responsibilities to a new management team.

Smith, the chief executive and chief investment officer of Fundsmith, will continue to provide advice and support to the incoming portfolio manager Michael O’Brien and assistant portfolio manager Sandip Patodia.

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The company also announced that it will cut the Fundsmith Emerging Equities Trust (Feet) annual fee from 1.25 per cent to one per cent of the firm’s net asset value from 31 May.

“The initial success of Fundsmith’s other investment trust has made me realise that my oversight as chief investment officer, with dedicated fund managers doing the day to day work, has worked extremely well and I believe the changes we are announcing today will help deliver the long term outperformance that we seek,” Smith said.

“The fee reduction also brings the charges closer into line with our other funds while recognising the greater geographical research coverage that we have to maintain on Feet.”

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O’Brien joined the company from Canaccord Genuity around a year before the launch of the trust and was “instrumental” in its development, Fundsmith said in a statement.

Patodia was previously a vice-president with Morgan Stanley’s UK investment bank from 2009 to 2013 before moving to Fundsmith.