DoubleLine's New Year's Resolutions
January 11, 2013
DoubleLine Capital ended 2012 with more than $50 billion in its coffers. But the three-year-old bond shop is not resting on its laurels.
It certainly hasn't been a quiet three years for DoubleLine and founder Jeffrey Gundlach, who became embroiled in a highly publicized, bitter litigation with his former employer TCW just one month after founding his firm. But it doesn't look like DoubleLine wants out of the spotlight just yet either - at least, not when it comes to their plans for continued asset and business growth.
Thus far in 2013, the company has already announced plans to hire for its client service and equity platforms. Gundlach also announced in a webcast on January 8 that he expects assets under management will reach the low $60 billion range by year's end. Ron Redell, president of DoubleLine Funds Trust, who oversees DoubleLine's mutual fund operations and distribution, recently spoke with Money Management Executive about the firm's plans to continue building on its existing infrastructure and servicing its clients in 2013.
Talk a little bit about your successes so far and what you attribute that to.
Investors have allocated approximately $53 billion in assets to DoubleLine in just three short years. We have over $42 billion in assets under management within the mutual fund space. Most of the growth in our mutual fund division was primarily due to the support from the professional investors, financial advisers, individuals and institutions that have experienced the value add of Jeffrey Gundlach and the investment management teams at DoubleLine. The $37.4 Total Return Bond Fund (DLTNX), a mortgage-focused strategy, was the fastest growing fund this year from an absolute asset-raising perspective.
Other areas of growth within the firm are in sub-advised mutual funds and international UCITs. We have grown to approximately $2.5 billion in that area of our business. We just formed a new relationship with Nordea (based in Denmark), and have essentially taken our Total Return Bond strategy and extended it to Europe and Latin America. International investors have allocated $600 million to this vehicle in a couple of months. So we're not only looking to expand strategies, but also expand vehicles around the world.
Any strategies in particular that are showing themselves as strong contributors to success?
We have a full suite of fixed income strategies at DoubleLine. The Total Return Bond strategy has been a primary driver of our asset growth. However, our strategies in multi-sector fixed income; DoubleLine Core Fixed Income (DBLFX) and Aston/Core Plus Fixed Income (ADLIX); emerging markets, DoubleLine Emerging Markets Fixed Income (DBLEX); low duration, DoubleLine Low Duration (DBLSX) and global multi-asset, DoubleLine Multi-Asset Growth (DMLAX) have attracted significant interest and assets as well.
We've been very thoughtful in terms of what investment strategies we launch. We don't want to launch strategies that are mediocre, redundant and/or don't provide a value added solution to our investment clients.
In terms of overall business development, what are the next steps for DoubleLine? How do you plan to continue asset growth?
We're looking to add additional investment strategies in 2013. We brought in a U.S. equity team and are looking to launch new investment strategies in that space in the first half of 2013. In addition, we're looking to launch more fixed income strategies in 2013. We will prudently add new investment strategies when we see an opportunity to add value to our investor client base.
We will also strategically continue to add partnerships with firms that don't cannibalize our existing business. We could be building our fund lineup in Europe with our partners, other sub-advisor relationships with mutual funds via a multi-manager approach, and also possibly the active ETF space. We're lastly continuing to add additional resources by building a retail wholesaler force that will specifically, from a client service perspective, work with the financial adviser and professional investor community.
What are you doing on the sales side to continue building the brand strength and reputation of DoubleLine?
We haven't hit our three-year track record yet in our mutual fund complex-it's not until April for our first two funds, and June 1st for our third. Our risk-adjusted investment performance is the most crucial aspect of the brand.
However, Jeffrey Gundlach and other thought leaders here continue to offer their intellectual capital and thought leadership. Providing that thought leadership in times of stress to the markets I think have been appreciated by the investment community over the last three years, and we'll continue to do that in 2013.
Additionally, we'll continue to build out our client service model here to service those clients and investors that are looking for information in a timely manner about our portfolios. We believe having strong risk-adjusted investment returns and client service are key elements to a successful experience for our clients.