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How do you determine how many sub-advisors to hire for each fund and the blend of manager styles?

The number of sub-advisors is a function of the type of fund and the number of highly skilled managers we can identify as potential sub-advisors. Generally we expect to have at least three sub-advisors and preferably four to seven.

We will not add a manager if we believe the new manager is not at least as skilled as the existing sub-advisors. We may also consider the distinctive nature of a particular manager’s investment approach. We are more likely to add a new sub-advisor if we believe they will add material diversification to the overall portfolio.

With respect to the blend of styles, unless it is a style-specific fund, we seek to keep each of our equity funds roughly style-neutral. This can be accomplished by various combinations of value, growth and blend managers.

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