The FSA Spy market buzz – 20 December 2024
Merry Christmas! The Year in Funds; Nuclear; Mag-7; Small Caps; Robotics; Bitcoin; Large Cap Growth; US Manufacturing; AI; Big Data; Lithium Batteries; Emerging Markets; Warfare and much more.
The Capital Group fund is managed by eight named portfolio managers, which are split into two legal entities, Capital Research Global Investors (CRGI) and Capital International Investors (CII), according to Jmili.
Heading up the whole fund is James Terrile. Claudia Huntington leads the CRGI division and Barry Crosthwaite heads up the CII side. Both Crosthwaite and Eric Stern make up the CII side, while the rest of the managers, which include Eric Richter, James Terrile, Lawrence Solomon, Aiden O’Connell and Gregory Wendt, are on the CRGI division.
The fund also has two unnamed managers on the CRGI division, according to Jmili, noting that the CII side is expected to hire another unnamed manager.
According to Jmili, Capital Group makes use of unnamed managers as part of their succession planning, and it would take an average of five years before for an undisclosed manager becomes a named manager.
“After they do a really good job, then they would be named as an official manager of the portfolio, usually if someone is leaving.
“It makes sense for them to have undisclosed managers to make sure that they prepare for succession. It is a really time-tested investment management approach within the team,” she said.
For example, Jmili noted that Huntington will be retiring in October, although she has started to transition some of her responsibilities to Terrile and Wendt. Wendt became a named portfolio manager recently after being an undisclosed manager for one year, following the announcement of Huntington’s retirement.
“Wendt is a veteran with 30 years of investment experience and has spent 16 years with the firm. Though he was an unnamed manager for just one year, he is already a named portfolio manager on other funds, which include the firm’s small cap strategies,” Jmili said.
The team also leverages on the firm’s 100-person analyst team, which may also contribute ideas.
Turning to the NB offering, Jmili said that the fund is managed by Richard Nackenson, who has been leading the fund since the US-domiciled version’s inception in 2006 (The Ucits version was launched in 2012). He is supported by Steven Majocha, who has been working with Nackenson since 2008.
Supporting Nackenson are five investment professionals who are dedicated to the strategy, as well as five more people, which include traders and statistical analysts, according to Jmili.
While Nackenson is experienced and has ample analyst support, Jmili is concerned about the team’s succession planning.
“Key-man risk is really the major concern here. The team has been very stable, but it is Nackenson who is really making the calls.
“He is not of retirement age yet, but it is always good when we know who is well-positioned and who is taking over if Nackenson decides to step down from the fund,” Jmili said.
Merry Christmas! The Year in Funds; Nuclear; Mag-7; Small Caps; Robotics; Bitcoin; Large Cap Growth; US Manufacturing; AI; Big Data; Lithium Batteries; Emerging Markets; Warfare and much more.
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