• / Free eNewsletters & Magazine
  • / My Account
Home>Research & Insights>Fund Times>American Century to Merge Vista Fund Into Heritage Fund

Related Content

  1. Videos
  2. Articles
  1. Top Bond-Fund Picks for Retirees

    Morningstar's Eric Jacobson runs the gamut with some of his favorite fixed-income funds, including ideas for core, short-term, multisector, high-yield, and muni exposure.

  2. Benz's and Kinnel's Picks for Starter Portfolios

    Morningstar's directors of personal finance and fund research list some favorite topnotch building blocks for beginning investors.

  3. Vaselkiv: Set the Right Expectations for High-Yield Bonds

    Favorable fundamentals and better yields relative to other fixed-income assets make high-yield bonds worthy of a long-term allocation, but investors shouldn't try to time the market and must ratchet down their return expectations, say T . Rowe Price High-Yield manager Mark Vaselkiv.

  4. Wide-Ranging Success for T . Rowe Price Capital Appreciation

    The strategy of this moderate allocation fund plays to T . Rowe's expertise across a broad range of asset classes, says Morningstar analyst Greg Carlson.

American Century to Merge Vista Fund Into Heritage Fund

T. Rowe Price seeks permission to create actively managed ETFs that are not transparent, a corporate-bond manager leaves PIMCO, and new managers are named to Oppenheimer Moderate and Ivy Global Natural Resources.

Morningstar Fund Analysts, 09/26/2013

American Century announced that it will close the long-struggling American Century Vista Fund TWVAX, merging the mid-cap growth strategy's assets into another mid-cap growth fund, American Century Heritage ATHAX. The merger will take place Dec. 6, 2013. In the case of the NT (no tobacco) shares of the fund, which are used in the firm's One Choice target-date funds, the switch will take place sooner, on Oct. 11.

A $1.5 billion fund, Vista has experienced both underperformance and manager turnover since 2008. And since previous lead manager Glenn Fogle left the firm in 2009, the new management team has not been able to right the ship. The fund's trailing five-year returns through Sept. 25, 2013, rank in the mid-cap growth category's bottom decile. Vista currently receives a Morningstar Analyst Rating of Neutral. It is fortunate for the fund's investors that American Century has a comparable strategy in Bronze-rated Heritage, which has $4.4 billion in assets. Lead manager David Hollond has been running the strategy since 2007.

T. Rowe Price Files for Nontransparent Actively Managed ETFs
On Monday, T. Rowe Price TROW filed with the SEC for the ability to offer nontransparent, actively managed exchange-traded funds. The firm previously received exemptive relief to offer transparent ETFs, though it has yet to launch any products. Daily disclosure requirements make the ETF vehicle unappealing for many active equity managers, who fear investors could front-run their trades. The exemptive relief that T. Rowe is seeking in its latest filing would help get around that. The strategies included in the filing are Capital Opportunity (an analyst-run strategy that is sector-neutral to the S&P 500 Index) and Blue Chip Growth. However, the firm says these would not necessarily be the strategies launched first, if it decides to launch any at all. T. Rowe's request comes a few weeks after Eaton Vance EV submitted a similar proposal to the SEC. BlackRock BLK, Vanguard, and State Street STT also have made similar proposals.

Emerging-Markets Corporate Bond Portfolio Manager Departs PIMCO
Brigitte Posch, lead manager of the $1.2 billion PIMCO Emerging Markets Corporate Bond PEMIX since its July 2009 inception, left the firm effective Sept. 20 to pursue another professional opportunity that has not yet been disclosed. Prior to joining PIMCO in 2008, she was a managing director and head of Latin American securitization and trading at Deutsche Bank.

Posch reported up to the firm's co-heads of emerging markets, Michael Gomez and Ramin Toloui, and had been based in PIMCO's Munich office since 2012. Upon Posch's exit, Gomez became lead portfolio manager of the firm's emerging-markets corporate portfolios, including PIMCO Emerging Markets Corporate Bond. Gomez has been at PIMCO for a decade and has been co-head of the firm's emerging-markets group since 2006. He is the lead manager on several emerging-markets mutual funds for the firm, including Morningstar Medalists PIMCO Emerging Markets Bond PEBIX, PIMCO Emerging Markets Currency PLMIX, and PIMCO Emerging Local Bond PELBX. While this is the first dedicated emerging-markets corporate fund that Gomez has taken a lead management role on, he has been overseeing the firm's emerging-markets corporate investments as head of the group since 2006.

Posch's departure is certainly a loss, but PIMCO maintains a deep emerging-markets team with 17 dedicated portfolio managers in total. That includes Kofi Bentsi and Ronie Ganguly, who were hired in June 2012 and May 2013, respectively, in an effort to continue building out the firm's emerging-markets corporate business. PIMCO also has begun a search for a senior-level hire to continue expanding its emerging-markets corporate team.

Oppenheimer Moderate Gains New Manager
Oppenheimer Moderate OAMIX has a new manager. Mark Hamilton, who spent 18 years at AllianceBernstein AB before joining Oppenheimer in the spring of 2013, is replacing Krishna Memani and Alan Gilston, who had run the $1.4 billion fund since 2010. Upon joining the firm in April, Hamilton was named named Oppenheimer's chief investment officer for global allocation and took the reins at the Neutral-rated, $1.8 billion Oppenheimer Global Allocation QVGIX.

Hamilton's most recent portfolio-management experience was on the tiny ($12 million) world-allocation offering AllianceBernstein Dynamic All Market ADAAX. His experience overseeing investments in a broad range of asset classes seems to be a better fit for Oppenheimer Moderate compared with Memani and Gilston, who specialize in fixed income and equities, respectively. That said, Hamilton ran Dynamic All Market for less than 16 months (until March 2013). And prior to that, he spent just less than two years on the management team of the AllianceBernstein Retirement Strategy target-date series. Those track records are too short to be indicative of Hamilton's prospects here.

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.

blog comments powered by Disqus
Upcoming Events
Conferences
Webinars

©2014 Morningstar Advisor. All right reserved.