There are times when you may have good reason to fire a fund manager. When a manager doesn't stick to its stated investment philosophy it is known as style drift, and a drifting manager is one to cut loose, say Glacier's Leigh Köhler, Nedgroup Investments' Anil Jugmohan and MitonOptimal's Joanne Baynham.

A manager that performs well when its investment style is out of favour or buys shares that don't match its stated investment philosophy could be drifting.

Loss of a star manager

Another reason to ditch a manager would be if there is a star fund manager who leaves and the team is unlikely to be able to continue to manage your money in the same way.

Baynham says MitonOptimal would move out of a fund if a star manager like Clyde Rossouw or Gail Daniel left Investec, but a manager like Allan Gray has more of a team approach and the loss of one manager is unlikely to compromise performance.

Jugmohan says Nedgroup recently changed managers on its Global Cautious Fund because the two main portfolio managers resigned to start their own boutique. Glacier dropped the fund from its buy list, Köhler says.

Active bets

Baynham says another reason to fire a manager is if the manager is not taking active bets on shares and is tracking an index too closely. An index-tracking fund will be cheaper, she says. Active managers should be investing with high conviction in a smaller number of shares that will deliver more than an index can.