In this day of disclosure, why is it sometimes difficult to get the scoop on who's man-aging your fund? Simply put: because of the myriad management options employed by fund families.
When deciding who will manage one of their portfolios, fund families choose from a number of scenarios. According to Don Cassidy, senior research analyst at Lipper, these include using an advisor, typically within the fund family, to manage the fund; employing co-advisors, where two or more companies are paid to man-age different parts of the fund; using subadvisors, where the advisor pays a subcontractor to manage the fund; and using multiple subadvisors, where portfolio managers of various funds within a larger fund each manage their own assets.
But getting to the bottom of things is now a bit easier. "While roughly two-thirds of [U.S. diversified equity] portfolios are managed by more than one person, starting last February, they can no longer say 'team managed.' They have to name the people manag-ing the fund," says Cassidy.
The best places to look are in the fund's prospectus, on the fund family's website, and in Morningstar's and Lipper's individual fund reports. Though it may take some digging, don't let the sleuth work stop you from finding out who's managing your fund's money--it'll make you a wiser investor.
Dian Vujovich is an author, syndicated columnist and publisher of fund-investing site www.fundfreebies.com.