Plus, Old Mutual's new offerings, fund reopenings, and more.
Vanguard recently has shaken up the management teams at several of its active multimanager equity funds. Its most surprising move was replacing Grantham, Mayo, Van Otterloo & Co. as a subadvisor of Vanguard U.S. Value
U.S. Value has posted lackluster results in recent years. The start of its slump coincided with the retirement of manager Richard Soucy in 2005. GMO also recently tweaked its quantitative model, replacing relative value factors with metrics that seek high-quality stocks. Vanguard, however, wouldn't say if these events led to GMO's firing.
Vanguard also gave Prudential Plc's M&G Investment Management more work. In addition to managing Fund Analyst Pick Vanguard Precious Metals and Mining
Old Mutual to Launch Target-Date Funds
Add another asset manager to the ever-growing list of target-date fund providers. Old Mutual has filed plans with the SEC to launch a suite of 12 funds named Target Plus Portfolios with target dates ranging from 2011 to 2050. The fund shop will serve as adviser to the Target Plus Portfolios and the underlying funds, and Ibbotson Associates Advisors will serve as subadvisor to assist with asset-allocation decisions. (Full disclosure: Ibbotson is a unit of Morningstar, Inc.)
These offerings will be "10" funds, which means that, for example, a 2031-2040 fund will be a suitable core option for investors planning to retire during those years. Old Mutual will offer three fund options in each 10-year range-- Conservative, Moderate, and Aggressive--which will have different initial mixes of equity and fixed-income securities.
Expense ratios for A shares will range from 1.26% to 2.33%, making these funds one of the more expensive target-date options. (Institutional and C shares are expensive as well.) The funds have a proposed launch date of March 3, 2008.
JPMorgan Mid Cap Funds Reopen
JPMorgan Mid Cap Value
Investors seeking mid-cap exposure should take a look at Mid Cap Value, which has the longest track record of the three funds. Simons has been at the helm since November 1997, and on his watch, the fund's institutional share class (which has been around longer) has generated an annualized 15.4% gain through January 2008, trouncing its mid-value peers. Its expenses are also below category median.
State Street Joins the Active ETF Race
Boston-based State Street Global Advisors has filed for SEC permission to introduce a family of nine actively managed, target-date funds. Their request comes less than a month after the SEC preliminarily approved PowerShares' four actively managed ETFs. SSgA's funds will have target dates of 2010, 2015, 2020, 2025, 2030, 2035, 2040, and 2045. A retirement income option will be available as well. These new funds will not track a benchmark and will be rebalanced annually.
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