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Fund Spy

Taking Fund Rivalries in the Right Direction

Better to focus on shareholders than on trashing former colleagues.

The court case in Los Angeles pitting DoubleLine founder Jeffrey Gundlach and several colleagues against their former firm, TCW, has further raised the profile of an acrimonious split between fund manager and fund firm that had already received much attention.

This affair is unusual. Typically in such episodes, the accusations and mudslinging don't end up in court. Often they don't even get into the media. But the animosity does get aired. Morningstar analysts have heard plenty of portfolio managers who have left to join a competitor or form their own firms enthusiastically bash former colleagues and employers. Advisors being pitched new funds from such managers or their salespeople have likely heard even more of this talk than we have, and with juicier details to boot.

Managers and firms should rein themselves in. Decorum and circumspection might seem quaint in the age of Twitter and TMZ, but professionalism never goes out of style.