Lord Abbett Developing Growth will close to new investors on March 5. Rapid asset growth makes this a prudent decision. The fund saw more than $1 billion of inflows over the past 12 months, bringing total fund assets to more than $5 billion as of Feb. 5, 2021. Lord Abbett has a decent record of managing capacity in this strategy. Lord Abbett similarly closed the fund in 2011, eventually reopening it in stages beginning in 2019 following a period of outflows. Keeping the asset base from becoming too large is particularly important as the managers trade frequently, with turnover typically ranging from 100%-250%, and they sometimes buy less-liquid small-cap companies. The decision to close the fund to new investment does not impact the fund’s Average Process rating or the Morningstar Analyst Rating of Neutral for all share classes.
Will LADFX outperform in future?
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The Process Pillar is our assessment of how sensible, clearly defined, and repeatable LADFX’s performance objective and investment process is for both security selection and portfolio construction.
The People Pillar is our evaluation of the LADFX management team’s experience and ability. We find that high-quality management teams deliver superior performance relative to their benchmarks and/or peers.
The Parent Pillar is our rating of LADFX’s parent organization’s priorities and whether they’re in line with investors’ interests.