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Delaware Limited-Term Diversified Inc A DTRIX

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Manager Roster Reshuffle Should Have Little Effect on Delaware Limited-Term Diversified Income

Associate Director

Analyst Note

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Effective Sept. 30, 2020, three of the strategy’s listed managers will be taken off the management roster and two new ones will be named as such. The departures are Roger Early, Adam Brown, and John McCarthy, while the new additions are David Hillmeyer and Daniela Mardarovici. The reshuffle looks more drastic than it actually is. The only substantial change is that Roger Early, Delaware’s fixed-income CIO, will retire effective June 1, 2021. Early has been a named manager on this strategy, though he was not involved in the day-to-day management. Brown and McCarthy specialize in bank loans and high yield, respectively, which is not where the bulk of the fund’s assets are. Brown and McCarthy will continue to contribute in their areas of expertise, as will all other contributors from other groups and Delaware, but the key decisions for this fund revolve around asset allocation and mortgages, hence it makes sense to retain Brian McDonnell, lead mortgage analyst at Delaware, as manager, and have him be joined by Hillmeyer and Mardarovici, who are clearly emerging as the leaders of Delaware’s multisector effort. Hillmeyer has been at Delaware since 2007, Mardarovici is a relatively new arrival, having joined Delaware from BMO in 2019. Both focus on multisector strategies. We thus expect little change in the strategy’s operations and stance, which therefore retains its Neutral rating on most of its share classes and a Negative rating on its most expensive one.

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