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Westwood's Byrne Drops Manager Title

Wintergreen legal drama ends and more. 

Rob Wherry, 03/09/2012

Susan Byrne is no longer a named manager at Westwood LargeCap Value WHGLX and Westwood Balanced WHGBX, according to a recent SEC filing. She remains co-chief investment officer and chairman of the board of Westwood Management Corp. WHG, the Dallas-based investment shop she founded in 1983. The firm, with $12 billion in assets under management, primarily serves institutional clients but started launching retail funds in 2001. However, Byrne's mutual fund track record dates back to 1987, when she began running GAMCO Westwood Equity WESWX. She's delivered strong long-term returns there, with the fund's cautious, risk-conscious approach helping it hold up particularly well in downturns. (Westwood LargeCap Value, launched in 2006, is a cheaper version of the GAMCO strategy.)

Westwood has had a succession plan in place for quite some time. During the past decade, the firm has fostered a more team-based stock-picking approach and bolstered its research ranks with both junior and veteran analysts. Byrne had stepped back from day-to-day management responsibilities during the past couple of years. The team overseeing LargeCap Value and Balanced remains in place. Byrne will continue to mentor the younger analysts in addition to working on the firm's new product launches.

Wintergreen Activism Gets Results, Sort Of
Wintergreen Advisers recently announced that it had reached an amicable resolution with Consolidated-Tomoka Land CTO, one of its portfolio holdings with which it had been fighting in court over access to the company's records. While the stock currently represents just 1.42% of assets in Wintergreen WGRNX as of Dec. 31, 2011, the advisor altogether owns more than 25% of the small-cap company when other accounts are included.

This resolution brings to an end legal wrangling that over the past few years had led to an almost entirely new board of directors and a new CEO at Consolidated-Tomoka, as well as other shareholder-friendly initiatives related to the board, such as separating the chairman and CEO roles.

While Wintergreen has been successful in its efforts to effect change at the company, CTO has not been a good investment for the fund. Wintergreen first bought CTO in 2006's first quarter, and at one point, the stock made up roughly 8% of fund assets. As of the end of 2011, the value of the fund's investment was roughly half its cost. That said, Wintergreen has been one of the world-stock category's best-performing funds since its inception in late 2005.

DFA Veteran to Head Firm's Institutional Business
Stephen Clark, head of portfolio management at Dimensional Fund Advisors, is becoming head of the firm's institutional group for North America. Clark, who joined DFA's portfolio management team in 2001, is replacing Dave Schneider, who is retiring. Schneider has been with DFA for 30 years, joining the firm shortly after the firm's founding in 1981.

Joseph Chi, who has been a DFA portfolio manager since 2005, and Jed Fogdall, who has been a DFA portfolio manager since 2004, will become co-heads of portfolio management. Chi works out of DFA's Santa Monica, Calif., office while Fogdall works out of its Austin, Texas, office, so their appointments provide representation in DFA's two major offices.

Like Clark, Chi and Fogdall have been members of DFA's senior investment committees, which regularly review strategy execution and recommend strategy changes. As is typical for most DFA managers, they have been managing a variety of strategies along with Clark, like DFA International Small Company DFISX and DFA Emerging Markets Value DFEVX. Clark will continue to be a named manager on several DFA funds as he will retain his positions on the investment committees. In his new role, Clark will head up the client-facing side of DFA's North American institutional business. DFA has a history of appointing those with asset-management experience to client-facing roles as its unique investment process can require additional client contact. Most of the firm's asset base is institutional.

Rob Wherry is a mutual fund analyst with Morningstar.

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