(PUB) Investing 2015

February 2 015

Morningstar FundInvestor

15

allocation funds, with more than $700 billion in assets and around $50 billion of inflows last year.

International-Stock Fund Manager of the Year Dodge & Cox International Stock DODFX This is an exemplary team from an exemplary firm. Dodge & Cox has rolled out only six strategies since it opened its doors during the Great Depression. Each fund is run collaboratively by an invesment- policy committee, including this one, and some members of this nine-person team also serve on the committees that direct other Dodge & Cox funds. Those funds, like this one, have put together impres- sive long-term records. The managers on the International Investment Policy Committee are highly experienced, to say the least. Every member of the team has been at the firm for more than a decade, and the average tenure is 24 years. Most have also spent their entire careers at the firm. The team won this award back in 2004 with five of the current nine members. Fixed-Income Fund Manager of the Year Ken Leech, Carl Eichstaedt, and Mark Lindbloom of Western Asset Core Bond WACSX and Western Asset Core Plus Bond WAPSX This year’s fixed-income award winner is a comeback story. The team underperformed during the financial crisis, revealing some flaws in its credit research, ineffective risk oversight, and poor communication between the firm’s macro and fundamental research teams. Since then, a number of improvements have been made to the investment process and risk management, and resources have been strength- ened across the board. From 2009 through 2014 , the team has guided both funds to topnotch records. Western Asset Core Bond and Western Asset Core Plus Bond land in the top quartile of the interme- diate-term bond category for the trailing five- and 10 -year periods ended Dec. 31 . This is a great example of managers who learned something from a crisis, ad- dressed the problems, and moved forward successfully. Allocation Fund Manager of the Year Anne Lester and Team of JPM organ SmartRetirement Target-Date Series This is the first time we’ve recognized a manager of a target-date series. It’s about time. As the invest- ment vehicle of choice (or by default) for retirement- plan savers, target dates are now the largest type of

Alternatives Fund Manager of the Year Robert Jones and Ali Motamed of Boston Partners Long/Short Equity BPLSX It probably comes as no surprise that we don’t have a very big universe of alternatives managers that have Morningstar Analyst Ratings of Gold, Silver, or Bronze. That’s because most mutual funds that pursue alterna- tive strategies have relatively short records. This year’s winner, however, is one of the longest-tenured managers in the alternative mutual funds space. Robert Jones took over Boston Partners Long/Short Equity in 2004 , when the strategy was overhauled to its current approach. Ali Motamed was promoted to the named management team in 2013 . American Hires T. Rowe Bond Chief Mike Gitlin, who has headed T. Rowe Price’s fixed- income team since 2009 , is leaving the firm as of Jan. 23 , 2015 . Gitlin, 44 , has accepted a role with the fixed-income team at Los Angeles-based Capital Group (advisor to the American Funds), where he’ll be a partner. His successor is Ted Wiese, a 30 -year T. Rowe veteran who’s run T. Rowe Price Short-Term Bond PRWBX , which has a Morningstar Analyst Rating of Silver, since 1995 . The unexpected departure is a loss for T. Rowe. Fixed income has become increasingly important to the firm in recent years as it tries to better balance out its domestic-equity-heavy fund lineup. Under Gitlin’s leadership, T. Rowe’s headcount on the fixed-income team grew to 76 in 2014 from 33 in 2007 , with par- ticular emphasis on adding quantitative resources and building an emerging-markets corporate-debt team from scratch. Unlike Wiese, Gitlin did not have experience running money before taking the job, which was a deviation from most of T. Rowe’s top executives. He also was not a T. Rowe lifer, as many executives at the firm are, joining in 2007 as global head of trading after holding sales and trading roles at Citigroup and Credit Suisse. Yet he proved to be a strong people manager and effective leader during his tenure. K