Changes in the Most Popular Mutual Funds Sold Via RIA Channel Serving High-Net-Worth & Ultra-HNW
May 5, 2008
Every 12 weeks Advisor Perspective.com looks at sales changes in the most popular mutual funds among the Registered Investment Adviser (RIA) and other "AdvisorPerspectives" (AP) universe.
This installment looks at changes from Jan. 31, 2008 to April 25, 2008. Previous installments were this past January, November, August and May.
The goal is to identify significant sentiment, either positive or negative, among RIAs whose clients are high-net-worth and especially ultra-HNW investors. The methodology of this exclusive data set and analysis is explained below.
SourceMedia also has complete tables of the 25 funds with the largest current assets under management (AUM) in the full Advisor Perspectives Universe, as well as data in each of the three tiers based on account size (largest, mid-sized and smallest).
Below are some of the significant changes in the AP Universe:
Funds Exhibiting Significant Gains: PIMCO TOTALRETURN FUND
Although the PIMCO Total Return Fund (PTRAX)fund dropped in overall ranking from third to fourth, AUM expanded by 15.3% for the full AP universe. The number of accounts grew by 491 across the AP universe, and the fund is used by 10 new advisory firms. Most of this growth was in the largest accounts, where AUM grew by 13.7% and 188 new accounts were added.
AMERICAN EUROPACIFIC GROWTH FUND
American Funds' American EuroPacific Growth Fund (AEGBX) moved from seventh to fifth in ranking across the AP universe, and, likewise, from seventh to fifth among the largest accounts. AUM grew by 17.6% across the AP universe, with 194 new accounts and 24 new advisory firms. Most of this growth was in the largest accounts, were AUM grew by 17.8% and 79 new accounts were added.
ARTISAN INTERNATIONAL FUND & HARBOR INTERNATIONAL FUND
Two international boutique funds, the Artisan International Fund (ARTIX) and the Harbor International Fund (HAINX), moved up significantly in rankings. ARTIX moved from 23rd to 11th, and HAINX moved from 50th to 17th across the AP universe.
For ARTIX, AUM grew by 70.1% across the AP universe. Although the number of accounts decreased by 14, the fund was used by 4 new advisory firms. In this case, significant new funds were added to existing accounts. For HAINX, AUM grew by 121.8% across the AP universe, with 88 new accounts and nine new advisory firms.
Funds Exhibiting Significant Losses: JP MORGAN INTERMEDIATE TAX FREE SELECT FUND
VSITX dropped from 5th to 313th overall in the AP universe. AUM dropped by 96.5% across the AP universe, and is held in 27 less accounts and by one les fewer adviser firm. The JPMorgan Intermediate Tax Free Select Fund lost significant assets in a small number of accounts and advisory firms.
MARSICO 21ST CENTURY FUND
The Marsico 21st Century Fund (MXXIX) dropped from 20th to 152nd overall in the AP universe. AUM dropped by 79.4% across the AP universe, and the fund as of the last snapshot was held in 1,035 fewer accounts but only by one less advisory firm. The fund lost significant assets across a small number of advisory firms.
iSHARES MSCI JAPAN IN FUND
Barclays' iShares MSCI JapanIn Fund dropped from 17th to 56th overall in the AP universe. AUM dropped by 56.6%, and 36 accounts dropped the fund, but four additional advisory firms picked it up. Meanwhile iShares MSCI JapanIn lost significant assets across a small number of accounts and advisory firms.
We rank funds by the assets under management (AUM) within our universe. A fund's ranking can improve or decline only if its AUM changes relative to other funds. Such changes can be due to any of the following:
* Existing advisers shifting money into/out of existing accounts
* Existing advisers putting money into of new accounts, or closing existing accounts
* New advisers putting money into new accounts
* Gains or losses in AUM due to fund performance
* Funds moving from the mid-sized account tier to the largest account tier, and vice versa
In some cases, funds moved down in ranking, but their AUM increased and the number of advisers utilizing the funds remained constant, as did the number of accounts holding the funds. We do not consider this a significant change in sentiment regarding the fund, which is our guiding criterion in this analysis. We look for situations where one or - more often - more of the following occurred:
* Change in fund ranking
* Change in AUM beyond what would be expected due to fund performance
* Increase or decrease in the number of advisors using the fund
* Increase or decrease in the number of accounts holding the fund
We also eliminate situations where changes in fund usage were due to movements between account tiers. Some subjective judgment comes into play. We do not have a single objective metric or standard that allows us to measure changes in the universe. But we believe that the examples we show above exhibit evidence of changes in advisor/investor sentiment. We are providing the criteria we used to select these funds, so you can be the final judge as to whether the change in advisor/investor sentiment is significant.
Finally, we consolidate holdings across share classes for a given fund. The ticker symbol displayed is the first symbol, alphabetically, among the various share classes. It may not be representative of the share class or classes held in the AP universe.
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