Reply to
@kevindow:
Shame on M*: they list the inception date of FEHIX as 11/19/2007, which is actually the inception date of ODHYX. FEHIX also adopts the performance of ODHYX, with no asterisk or qualifying statement by M*.
I realize that slamming M* is all the rage here, but what exactly is the problem?
Funds reorganize all the time. How many ballots have you (or others here) seen in the past several years reorganizing funds as Delaware companies, where the assets of the old company are taken over by the new one, and a new management agreement is approved for the new company. For example, that's going on as we speak with several
Oppenheimer Funds. To compare, here are the comparable proxy materials for the Old Mutual/First Eagle
reorganization.
It's a fair question to ask why this transaction was effected as a reorganization rather than keeping the fund intact, as I believe was done with the Ameriprise acquisition of Columbia. I don't know the answer to that, but I suspect it to be more a business/legal issue than one of how the fund is run. In either case, the shareholders must approve the continuation of the management.
What I consider deceptive, and is not happening here, is the adoption of a record that does not represent the past history of the fund. When two funds merge, only one history survives, and fund complexes often choose to use the smaller fund's history when it is significantly better than that of the larger fund.
Regarding M* not making any note, that is not correct. Under management, M*
states that the managers joined First Eagle Investment Management, LLC in 201, having previously served at Dwight Asset Management where they managed the Predecessor Fund since its inception 11/19/07.
Finally, when there is a substantial change in the fund, M* does note that. See, e.g.
BMPEX. There, M* draws a dividing line, at the transition point, and adds boilerplate language: "The fund's investment structure or legal structure substantially changed as of 12/01/2009. Prior to that date, the fund followed a significantly different investment strategy, or it operated under a different legal structure subject to different regulatory requirements." In the case of
BMPEX, it was the latter (different legal structure, different regs). I don't see any part of this boilerplate applying to FEHIX.
