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Tradewinds Leader Sets Sail

Putnam loses key executive and more. 

Morningstar Fund Analysts, 03/16/2012

David Iben, Tradewinds' chief investment officer and co-president, will leave the firm at the end of June to join Vinik Asset Management.

His departure is a major loss for the firm and shareholders of its funds. Iben helped create Tradewinds in 2006 when it was spun out of NWQ Investment Management. (Both are subsidiaries of Nuveen.) He was responsible for building up Tradewind's 14-member analyst team and devising a structure in which each fund could own only stocks that had been accepted onto a firmwide "approved list." Iben, who oversaw this list and was an integral member of the investment process, had a strong record running a separate account since 1999 and funds like Nuveen Tradewinds Value Opportunities NVOAX and Nuveen Tradewinds Global All-Cap NWGAX. His separate account, which was run similar to the Value Opportunities fund, returned 16.5% annualized gross of fees the past 10 years through Feb. 29, 2012, besting all large-cap blend funds. Firmwide assets grew to $34.3 billion as of Dec. 31, 2011.

Tradewinds has not yet announced who will take over Iben's funds. Unfortunately, there is no natural successor at Value Opportunities and Global All-Cap since Iben managed both himself, with input from his analyst team. None of those 14 analysts has the public record running funds Iben amassed.

Meanwhile, Tradewinds will split Iben's larger management duties among several people. Constance Lawton, who shared the co-president title with Iben, will become the firm's sole president. Emily Alejos and Drew Thelen will share the CIO role. Both Alejos and Thelan joined Tradewinds in 2006 as equity analysts. Alejos has comanaged Nuveen Tradewinds Emerging Markets NTEAX since its 2008 inception, but that fund's 22.1% annualized gain from its launch through March 14, 2012, trails more than three fourths of its diversified emerging-markets peers. Thelen has run Nuveen Tradewinds Small-Cap Opportunities NTSAX since its 2011 launch. Alejos' and Thelen's public track records are too short to inspire much confidence.

This isn't the firm's first major departure. In mid-2009, Paul Hechmer left to build his own asset-management firm, del Rey Global Investors. Hechmer, who worked with Iben at NWQ and helped found Tradewinds, successfully managed Nuveen Tradewinds International Value NAIGX and its NWQ predecessor for seven years. When Hechmer left, analysts Peter Boardman and Alberto Jimenez Crespo took over. Iben was around to smooth that transition, but now his departure lessens the Tradewinds lineup's appeal.

Iben is joining hedge fund firm Vinik Asset Management. The firm was founded by Jeffrey Vinik, who ran Fidelity Magellan FMAGX for four years in the 1990s.

Putnam Loses Key Executive
Charles Schwab Corp. SCHW announced it hired Jeffrey Carney to run its retail branch network. Carney was recently a managing director at Putnam Investments in charge of marketing. At Schwab, Carney will work on growing the firm's network of more than 300 branches. Those outlets serve as the main interface between the firm and its clients and are a key source of information on clients’ needs. Carney was part of a wave of executives that first joined Putnam in 2008 when Robert Reynolds, the former vice chairman and chief operating officer of crosstown rival Fidelity, took over the ailing firm. Carney had a large hand in the launching and marketing of Putnam's controversial absolute return funds. Those funds now hold around $3 billion in assets. It's unclear whether Carney's exact role and title will be filled at some point. But Putnam did announce that Scott Sipple, another Fidelity veteran, was tapped to be the head of investment product management and development. In that role he will oversee the product management teams that work on the firm's equity, fixed-income, and global asset-allocation offerings.

Dreyfus Manager Change, Fund Happenings
Dreyfus announced several changes to its fund lineup. Peter Vaream has stepped down from managing mutual funds for Standish, the subadvisor on several Dreyfus fixed-income funds. He is no longer listed as a manager on Dreyfus Intermediate Term Income DITIX, Dreyfus Short Term Income DSTIX, Dreyfus Inflation Adjusted Securities DIASX, Dreyfus Balanced Opportunity DBOBX and Dreyfus/Standish Fixed Income SDFIX. The remaining comanagers at each of those funds remain at the helm.

Morningstar fund analysts cover more than 1,700 mutual funds and write regular commentary covering fund industry news, fund investing trends, picks, portfolio planning, international investing, and more.
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