San Antonio, Texas-based USAA Asset Management plan to merge the $451.3 million USAA First Start Growth fund into the $2.5 billion USAA Cornerstone Moderately Aggressive fund on June 15 2018, according to a document filed with the Securities and Exchange Commission (SEC).
Both funds are managed by the same team with the exception of John Toohey, who manages the USAA First Start Growth fund but not USAA Cornerstone Moderately Aggressive.
Toohey had been a manager on the USAA Cornerstone Moderately Aggressive fund until June 2017 when he had been taken off of the fund in addition to five other Cornerstone funds.
According to a USAA spokesman, Toohey will not join the management team of the USAA Moderately Aggressive fund.
The USAA Cornerstone Moderately Aggressive fund is ranked 91 out of 116 Mixed-Asset Target Allocation Moderate funds tracked by Citywire for three-year total returns to the end of January. Over that time it returned 18.6% compared to the average Mixed-Asset Target Allocation Moderate fund, which was up 21.6%.
The USAA First Start Growth fund is ranked 94 out of 117 Mixed-Asset Target Allocation Growth funds tracked by Citywire for three-year total returns to the end of January. Over that time it returned 24.3% compared to the average Mixed-Asset Target Allocation Moderate Fund, which was up 27.3%.
If completed, the merger is to result in a lower management fee for shareholders as the annual management fee for the First Start fund is 75 basis points (bps) and the annual management fee for the Cornerstone fund is 59 bps.
According to the filing, the funds are being merged because the board believes that it will permit shareholders to pursue comparable investment goals in a larger fund with a lower total annual operating expense ratio.
T. Rowe launches multi-strategy liquid alts fund
Baltimore-based T. Rowe Price has launched the T. Rowe Price Multi-Strategy Total Return fund, which combines six liquid alternative strategies in an attempt to offer returns uncorrelated to equities or fixed income.
The fund is managed by Richard de los Reyes and Stefan Hubrich and has an annual management fee of 100 basis points (bps).
The fund combines macro and absolute return, fixed income absolute return, equity research long/short, quantitative equity long/short, volatility relative value and style premia strategies. The weightings to the strategies are then rebalanced based on fundamental and quantitative analysis.
Citywire reported when the fund had been initially filed for in June 2017.
Sebastian Page, head of the multi-asset division, said: ‘Under Stefan’s and Rick’s leadership, the Multi-Strategy Total Return fund offers investors absolute return type of management, but with the cost, liquidity, and accessibility of a mutual fund.’
JPMAM makes senior fixed income appointments
JP Morgan Asset Management has named Amit Bhuchar global head of fixed income trading and business initiatives, replacing Nick Cox who left the firm.
Bhuchar is based in New York City where he reports to Bob Michele, chief investment officer and head of global fixed income, currency and commodities group, a JP Morgan spokeswoman confirmed.
Previously, Bhuchar had been global fixed income chief operating officer from July 2014 to November 2017, according to his LinkedIn. Prior to joining the firm in 2005, he worked in audit and assurance at UK-based Deloitte.
Cox, who had been global head of fixed income and trading initiatives for four years, had been chief operating officer of global trading and liquidity strategies at BlackRock prior to joining JP Morgan in 2014.
Separately, JP Morgan Asset Management’s head of Asia Fixed Income, Stephen Chang, has exited the firm.
Chang, who was named on four funds, has been replaced by Shawn Yann Ho who was most recently head of Asian credit.