Our weekly roundup of industry highlights
Vanguard Charitable celebrates $10B charity donations
Vanguard Charitable, a nonprofit who sponsors donor-advised funds, announced that the organization issued $10 billion in grants since launching in 1997.
Roughly two-thirds of the $1.2 billion contributions to Vanguard Charitable in 2019 came from appreciated assets, allowing donors to strategically leverage their investment portfolio to maximize the amount they give to charity, according to the firm. Among the most popular causes supported throughout the past year were organizations in human services, religiously affiliated charities, education, health, and arts and culture, according to the firm.
Franklin Templeton acquires Legg Mason
Franklin Templeton entered into a definitive agreement to acquire Legg Mason for $50 per share of common stock in an all-cash transaction, according to the firm. The firm will also assume approximately $2 billion of Legg Mason's debt outstanding.
The acquisition of Legg Mason and its multiple investment affiliates, which collectively manage over $806 billion in assets, will establish Franklin as one of the world's largest independent global investment managers, with a combined $1.5 trillion in assets under management, according to the firm.
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The nearly $4.5 billion deal is another case of consolidation in the industry, as firms grapple with falling fees and the rising challenge from managers of index-tracking funds.
February 18 -
Whether it's AI managing regulations or next-gen tools acting as data scientists, managers say tech will change how they work.
February 7 -
Fidelity Investments, Invesco and American Century Investments are among those pitching rival visions for ETFs that disclose their holdings like mutual funds.
January 27
"This is a landmark acquisition for our organization that unlocks substantial value and growth opportunities driven by greater scale, diversity and balance across investment strategies, distribution channels and geographies," says Greg Johnson, executive chairman of the board of Franklin Resources.
Vanguard and HarbourVest launch private equity partnership
Vanguard has partnered with HarbourVest to provide investors with access to private equity offerings, according to the firm. Initially, the new strategy will be provided by Vanguard's institutional advisory services to pensions, endowments and foundations, the firms says.
"Private equity will complement our leading index and actively managed funds, as we seek to broaden access to this asset class and improve client outcomes," says Vanguard CEO Tim Buckley. "While this strategy will be initially available to institutional advised clients, we aim to expand access to investors in additional channels over time. For individual investors in particular, this partnership will present an incredible opportunity."
RESEARCH
Hedge fund managers are avoiding sustainable investing
Hedge funds, many of which have been slow to adopt environmental and social strategies, are faulting inconsistent data and a shortage of expertise for their hesitation, according to a new report in Bloomberg News.
About 63% of hedge fund managers cited a lack of quality and consistent sustainability data as the biggest challenge in making such decisions, according to a report from an industry consortium. Just 15% of hedge funds have incorporated ESG matters in their investment strategies, according to the article.
Hedge fund investors are pushing for ESG-focused offerings, but according to the report, they fear "greenwashing" — the use of misleading labels or advertising to create just an illusion of environmental responsibility.
PRODUCTS
New VanEck ETF to tap demand for muni debt with social investing
VanEck filed to register an actively run sustainable muni ETF focused on investment-grade state and local government debt from "issuers with operations or projects helping to promote progress towards sustainable development," according to Bloomberg.
The fund will use the United Nations' sustainable development goals, which aim to encourage sustainable cities and promote responsible consumption to help make investment decisions, the filing says.
Franklin Templeton launches growth fund
Franklin Templeton announced the introduction of Franklin Focused Growth Fund, which seeks to invest predominantly in equity securities of companies the investment manager believes offer compelling growth opportunities, according to the firm. The fund is managed by Matthew Moberg, per the firm.
"We consider many factors when selecting investments, including a company's strategic positioning in its industry, its historical and potential growth in free cash flow, and an assessment of the strength and quality of management," says Moberg, senior vice president and portfolio manager with Franklin Equity Group.
Hartford Funds expands fixed-income offering
Hartford Funds launched Hartford Core Bond ETF (HCRB), an ETF sub-advised by Wellington Management, which seeks to provide long-term total return by investing primarily in investment-grade fixed-income securities, according to the firm.
The fund, which has an expense ratio of 0.29%, provides investors with high-quality fixed-income exposure from diversified sources of return across multiple perspectives, investment styles and time horizons.
"Hartford Core Bond ETF is designed to satisfy an increasing investor appetite for high-quality core bond offerings, especially in ETF vehicles," says Ted Lucas, head of investment strategies and solutions at Hartford Funds.
T. Rowe aims to improve retirement outcome with new products
T. Rowe Price announced the expansion of its target-date retirement product lineup.
The additions, the firms says, are designed to help improve retirement outcomes and address the headwinds investors face in achieving retirement security.
Over a two-year period, T. Rowe Price will gradually increase equity exposure in the retirement and target portfolios' glide paths early in the accumulation years and post-retirement, and add emerging markets and U.S. large-cap core equity strategies to further diversify investments, the firm says.
Franklin Templeton adds 3 thematic funds focused on dynamic innovation
Franklin Templeton expanded its active ETF lineup with the addition of three thematic funds: the Franklin Disruptive Commerce ETF (BUYZ), the Franklin Genomic Advancements ETF (HELX) and Franklin Intelligent Machines ETF (IQM), the firm says.
The 20 top-performers are largely comprised of low-cost tech offerings.
Each of the funds seek long-term capital appreciation by investing primarily in equity securities of companies that are relevant to the fund's respective investment theme, the firm says.
"We are thrilled to bring our first thematic ETFs to market. BUYZ, HELX and IQM are focused on investing in innovative companies within each theme — e-commerce, genomics and intelligent machines," says Patrick O'Connor, global head of ETFs for Franklin Templeton.
Delta Data releases institutional profit, expense forecasting tool
Fintech company Delta Data announced the launch of an institutional profit and expense forecasting tool, IntelliCaster; designed track multiple economic models asset manager distributors to leverage to forecast everything from sales to fee data, according to the firm.
“We developed IntelliCaster to provide financial models that will aid in more realistic forecasting,” says Delta Data CEO Whitfield Athey. “No one has a crystal ball, however, with the major economic variables covered, any asset manager will be afforded a tighter picture of what profits against expenses should look like.”
The platform, launched at the annual NICSA Strategic Leadership Forum in February, provides a platform for asset managers to input macro-economic forecasts, which are then used as the basis for scenarios that include adjustments from sales by region, dealer or product and by finance that adjusts by share class, fee waivers and other proprietary inputs, according to Delta Data. Once put in the system, IntelliCaster produces forward-looking analysis of projected distribution fees, expenses and profit.
ARRIVALS
Invesco appoints deputy CFO
Allison Dukes, the former chief financial officer for SunTrust, joined Invesco as deputy chief financial officer, with transition plans to assume senior managing director, the firm says.
Upon taking the position, Dukes will take the position of deputy CFO at Invesco through Aug. 1, at which time she will assume her new role as senior managing director and CFO following the retirement of Loren Starr, who currently holds that position, according to the firm.
Dukes will report to Starr, senior managing director and chief financial officer at Invesco.
"Allison's experience as CFO and, as importantly, her deep experience overseeing key parts of SunTrust's business, will be invaluable as we work to further strengthen and scale our business for the benefit of clients and shareholders," says Marty Flanagan, president and CEO of Invesco.
T. Rowe names successor to head its international equity division
Justin Thomson, chief investment officer of international equity and lead portfolio manager of the International Small-Cap Equity Strategy at T. Rowe Price, will succeed Chris Alderson as head of the firm's international equity division, according to the firm.
Thomson will join the T. Rowe's management committee and report to Robert Sharps, head of investments.
As a result, Ben Griffiths will become co-portfolio manager of the International Small-Cap Equity Strategy, joining Thomson until he relinquishes his portfolio manager responsibilities following the transition period, according to the firm.
"The international equity division is in a strong place, and the firm has become an ever more global business," says Chris Alderson, head of international equity at T. Rowe Price. "I have huge confidence that Justin Thomson will do an outstanding job in my place."
