Joyce is also set to leave GMO. Also, American Century's LIVESTRONG funds withstand Lance Armstrong controversy, Dreyfus' CEO departs, manager changes at Fidelity and American Century, and analyst reductions at UBS Global Asset Management.
William "Chuck" Joyce stepped down as the lead manager on GMO Quality GQETX on Friday, Jan. 18.
Joyce, 42, also is leaving GMO, where he has worked since 1998. However, Joyce will remain with the firm through June to ease the transition. Current GMO Quality comanagers Tom Hancock and David Cowan will remain on the fund. Although the quality factor (that is, sticking with companies with above-average returns on equity) has been a key part of GMO's process since the early 1980s, Joyce was the main architect behind this fund and he had been lead manager since its 2004 inception. His experience will be missed.
However, Joyce's departure should not be too disruptive. Hancock, who has been a comanager for nearly four years, and Cowan provide continuity. Plus, the two other members of the GMO quality team, Kim Mayer and Hassan Chowdhry, will remain with the firm. Both have been with GMO for about six years.
One change, though, is that the quality function will be integrated throughout GMO's equity effort. In the past, the quality team had operated fairly independently, but now the entire research team will share this responsibility.
American Century LIVESTRONG Target-Date Funds Survive Armstrong’s Confession
Though Lance Armstrong suffered a blow to his reputation following his public confession to doping last week, the American Century LIVESTRONG funds appear to be so far unscathed from their association with the disgraced athlete. The target-date series has enjoyed net inflows in all of its funds so far in January 2013, as well as in calendar year 2012.
The firm has not publicly stated any intent to change the LIVESTRONG funds' branding. According to an American Century representative, the firm's relationship is not with Armstrong but with the LIVESTRONG charity, which severed ties with Armstrong in late 2012.
Dreyfus CEO Steps Down
Jonathan Baum, the chairman and CEO of Dreyfus, resigned from the firm on Monday, Jan. 21. According to the firm's statement, Baum left to pursue other interests. Dreyfus president J. Charles Cardona will manage Baum's former responsibilities in the interim.
Baum joined Dreyfus in 2006 and became CEO in February 2008 after the previous CEO and president, Tom Eggers, retired. At the time, Baum was the firm's vice-chair of distribution. Prior to joining Dreyfus, Baum was the chief operating officer of Scudder Investments, now part of DWS.
During Baum's tenure as CEO, the firm enjoyed net inflows from 2009 through 2012. The inflows are primarily from Dreyfus Appreciation DGAGX, the firm's largest fund, and a few international funds. Nonetheless, the past few years have not been a picture of stability. Since Baum took over in 2008, the firm has merged or liquidated more than 50 funds and launched more than 10 new strategies. Fund performance has also not been stellar. In particular, the firm's fixed-income funds have stumbled in the past three years. Sizable strategies like Dreyfus Municipal Bond DRTAX and Dreyfus High Yield DPLTX are in their category's bottom quintile for performance over the three-year period.
RiverPark Small-Growth Fund to Liquidate
RiverPark Small Cap Growth RPSFX will liquidate on Jan. 25, 2013. The fund was incepted only a few years ago, on Sept. 30, 2010. Since then, the fund has suffered from poor performance and a minuscule asset base. As of Jan. 18, 2013, the fund held only around $4.5 million in assets under management.
Manager Change at American Century Funds
Stafford Southwick is no longer a comanager on American Century New Opportunities TWNAX or American Century Small Cap Growth ANOAX and has left American Century and the investment industry. Now, comanager Matthew Ferretti and new manager Jeffrey Otto are the listed portfolio managers of the funds. Otto has been an analyst at American Century since 2006.
Fidelity Sector Manager Steps Down
Kristina Salen, who manages several telecommunications funds at Fidelity, will leave the firm at the end of the month. Matthew Drukker will take over Salen's current role as portfolio manager of Fidelity Select Telecommunications FSTCX, while Nidhi Gupta will assume portfolio manager responsibilities for Fidelity Select Multimedia FBMPX. Drukker and Gupta joined Fidelity as analysts in 2008, and Drukker currently comanages Fidelity Select Wireless FWRLX.
Pioneer Merges Several Funds
Pioneer will merge away several funds in the second quarter of 2013. Pioneer Fundamental Value CVFCX will merge into Pioneer Disciplined Value SERSX; Pioneer Growth Opportunities PGOFX will merge into Pioneer Select Mid Cap Growth PMCTX; and Pioneer Independence PINDX will merge into Pioneer Disciplined Growth SRSGX. Additionally, Pioneer Research PATMX will merge into Pioneer Value PIOTX by the second quarter of 2013, and Pioneer Value will change its name to Pioneer Core Equity.
Of the merging funds, Pioneer Fundamental Value, Pioneer Growth Opportunities, and Pioneer Independence have suffered performance woes in the past three years and have been in net outflows for at least three years as well. Pioneer Research, on the other hand, has actually performed decently well in the past few years and even saw some inflows in 2012, but sat on a small asset base of around $63 million as of December 2012.
In addition, Pioneer Fundamental Value had undergone some recent management changes. The fund was managed by subadvisor Cullen Capital Management from its 2000 inception through July 2012. Pioneer's board fired Cullen in 2012 and moved the management of the fund in-house. While there were some performance-based reasons to fire Cullen, our analysts also had some concerns at that time about Pioneer cutting costs at the expense of shareholders.
UBS Global Asset Management Cuts Analyst Staff
Last month, UBS Global Asset Management laid off three U.S. equity analysts on its Chicago-based U.S. Equities Core/Value Research team as a part of a restructuring.
The restructuring began in September, when the firm promoted longtime managing director Thomas Digenan to be UBS Global Asset Management's head of U.S. equities core/value and longtime senior investment analyst Scott Wilkin to be the team's director of research. A UBS Global Asset Management spokeswoman said that with those promotions, Digenan and Wilkin were tasked with creating a team structure with "a greater culture of collaboration and accountability."
The result, implemented last month, meant laying off three longtime analysts overseeing coverage of energy, industrials, and consumer staples and discretionary, according to a statement the firm issued. With those departures, the U.S. Equities Core/Value analyst team shrank to nine analysts from 12.
The departed analysts had helped to provide research support for a variety of institutional products and mutual funds, including acting as the subadvisor for a portion of the $1.3 billion fund USAA Growth & Income USGRX. UBS Global Asset Management was removed from those subadvisory responsibilities in November, as Fund Times reported on Nov. 29.
Director of mutual fund research Russel Kinnel, associate directors of fund analysis Dan Culloton and Bridget B. Hughes CFA, senior fund analysts Josh Charlson, Kevin McDevitt, and Gregg Wolper, and fund analysts Robert Goldsborough, Kailin Liu, Flynn Murphy, and Rob Wherry contributed to this report.