Assets among the affiliated managers of the Leawood, Kansas multi-boutique grew 54 percent, to $20 billion, in 2013. Montage had experienced $4 billion in asset growth in 2012.
The hefty asset growth was the result of a number of factors, including the hiring of 42 people, bringing the total number of professionals at Montage to 262, as well as the launch of six mutual funds.
The new funds launched last year were:
1. Tortoise North American Energy Independence Fund – launched April 1, 2013.
2. Tortoise Select Opportunity Fund – launched September 30, 2013.
3. Palmer Square’sFountain Short Duration High Income Fund – launched October 7, 2013.
4. Convergence Opportunities Fund – launched November 29, 2013.
5. Consilium Emerging Market Small Cap Fund – launched December 30, 2013.
6. Nuance Mid Cap Value Fund – launched December 31, 2013.
Launches multiple new mutual funds, adds to growing lineup of asset management affiliates Growth of the Kansas-based firm a result of advisors’ increasing need for alternative investments as well as retirement income
Leawood, Kan. – January 10, 2014 – Montage Investments today reported that assets at the firm’s affiliated investment managers increased from $13 billion to nearly $20 billion in 2013, following more than $4 billion of growth in 2012.
The firm’s asset growth, driven by an increased demand from advisors and their clients for access to investments believed to have the potential to produce superior risk-adjusted returns across market cycles, has prompted the firm to add to its growing base of experienced asset management affiliates and launch several new mutual funds.
According to Gary P. Henson, CFA, CFP®, president and chief investment officer of Montage Investments, “I’m very pleased with the growth we’ve experienced over the last year. We’ve spent the past several years building our infrastructure and laying the framework for our efforts. Because we took the time to build a solid foundation on which to grow, we have been able to seamlessly add and support multiple new entities and new offerings over the last year – helping us toward our goal of providing industry-leading investments for advisors and their clients.”
Montage’s new affiliates include Fountain Capital Management and Consilium Investment Management. Fountain joined the Montage family of companies when it was acquired by Palmer Square Capital Management in January. Fountain, a high yield bond and leveraged loan manager, provides a strong experienced credit analyst team to further enhance Palmer Square’s credit platform and help further advance the overall firm’s growth initiatives. And in December, Consilium Investment Management, a frontier and emerging markets manager, joined as a sub-advisor to the new Consilium Emerging Market Small Cap Fund.
New mutual funds launched in 2013 include:
• Tortoise North American Energy Independence Fund – TNPIX/TNPTX/TNPCX (April 1)
• Tortoise Select Opportunity Fund – TOPIX/TOPTX/TOPCX (September 30)
• Palmer Square’s Fountain Short Duration High Income Fund – PFHIX/PFHAX (October 7)
• Convergence Opportunities Fund – CIPOX/CIPVX (November 29)
• Consilium Emerging Market Small Cap Fund – CEMSX/CEMNX (December 30)
• Nuance Mid Cap Value Fund – NMVLX/NMAVX (December 31)
The new funds enhance the firm’s existing lineup, bringing the total number of mutual funds to 12. Montage affiliates also manage a wide range of closed-end funds and separate accounts, and three of the firm’s products were given 5-Star Overall Ratings by Morningstar:
• Nuance Concentrated Value Separate Account – 5-Stars as of September 30, 2013 – versus 374 separate accounts in the Large Value category
• Nuance Mid Cap Value Separate Account – 5-Stars as of September 30, 2013 – versus 94 separate accounts in the Mid-Cap Value category
• Convergence Core Plus Fund – 5-Stars as of November 30, 2013 – versus 1,347 funds in the Large Blend category
The top 10% of all strategies in a category earn 5-Stars and the Overall Morningstar RatingTM for the strategies are derived from a weighted average of each strategy’s three-, five-, and ten-year risk-adjusted return measure, if applicable.
In addition, asset management affiliate Palmer Square Capital Management closed on two collateralized loan obligation funds in 2013. On April 15, the firm closed CLO 2013-1, Ltd. at $362 million and on September 17, it closed CLO 2013-2, Ltd., at a $464 million issuance.
To support the firm’s recent growth, Montage has also added to its growing team. In 2013 alone, the firm added 42 professionals across the organization, bringing the total number of associates to 262. As a result, Montage has greatly enhanced its capabilities and expanded nationwide access to the firm’s investments.
“It’s been an exciting year,” said Marty Bicknell, chief executive officer of Montage. “More importantly, it’s been a great year for many of our clients. I look forward to continuing to deliver innovative investment offerings to advisors and their clients in 2014 and for many years to come.”
About Montage Investments
?Montage Investments provides institutional-caliber investments to investors and the financial professionals who serve them. Through a family of independent asset managers, unified by deep market insight and fundamental research, Montage offers alternative investment solutions across the spectrum of asset classes and strategies that include mutual funds, closed-end funds and separate accounts. Collectively, Montage Investments managed $20 billion as of December 31, 2013.
Visit www.montageinvestments.com.
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Before investing in the funds, investors should consider their investment goals, time horizons and risk tolerance. The funds’ investment objectives, risks, charges and expenses must be considered carefully before investing. The summary prospectus and statutory prospectus contain this and other important information about the investment companies. Prospectuses for all funds may be obtained by calling 888.870.3088, or visiting www.montageinvestments.com/funds.
Past performance does not guarantee future results.
Investing involves risk. Principal loss is possible.
Nuance Concentrated Value and Mid Cap Value Strategies
Investments in small and mid-capitalization companies involve additional risk such as limited liquidity and greater volatility than larger capitalization companies. Investments in foreign securities involve greater volatility and political, economic and currency risks and differences in accounting methods. The strategies are non-diversified, meaning they may concentrate their assets in fewer individual holdings than a diversified fund. Therefore, they are more exposed to individual stock volatility than a diversified fund.
Convergence Core Plus Fund
Investments in midcap companies involve additional risk such as limited liquidity and greater volatility than larger capitalization companies. The Fund invests in foreign securities which involve greater volatility and political, economic and currency risks and differences in accounting methods. The fund regularly makes short sales of securities, which involves unlimited risk including the possibility that losses may exceed the original amount invested. However, a mutual fund investor’s risk is limited to one’s amount of investment in a mutual fund.
Tortoise Funds
The funds are non-diversified, meaning they may concentrate their assets in fewer individual holdings than a diversified fund. Therefore, the funds are more exposed to individual stock volatility than a diversified fund. Investing in specific sectors such as energy may involve greater risk and volatility than less concentrated investments. Risks include, but are not limited to, risks associated with the North American energy companies, including upstream energy companies, midstream energy companies, downstream energy companies, energy company beneficiaries, commodity price volatility risk, supply and demand risk, reserve and depletion risk, operations risk, regulatory risk, environmental risk, terrorism risk, natural disasters and climate change risks. The adviser does not anticipate that the fund will significantly invest in MLPs in all circumstances and market conditions, and may not be invested in MLPs at all. However, the fund may invest up to 25% of its total assets in MLPs. The tax benefits received by an investor investing in the funds differs from that of a direct investment in an MLP by an investor. The value of the fund’s investment in an MLP will depend largely on the MLP’s treatment as a partnership for U.S. federal income tax purposes. If the MLP is deemed to be a corporation then its income would be subject to federal taxation, reducing the amount of cash available for distribution to the fund which could result in a reduction of the fund’s value. Investments in foreign companies involve risk not ordinarily associated with investments in securities and instruments of U.S. issuers, including risks related to political, social and economic developments abroad, differences between U.S. and foreign regulatory and accounting requirements, tax risk and market practices, as well as fluctuations in foreign currencies. The fund invests in small and mid-cap companies, which involve additional risks such as limited liquidity and greater volatility than larger companies. Investments in debt securities typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities. Investment in lower-rated and non-rated securities presents a greater risk of loss to principal and interest than higher rated securities. The fund may also invest in derivatives including options, futures and swap agreements, which can be highly volatile, illiquid and difficult to value, and changes in the value of a derivative held by the fund may not correlate with the underlying instrument or the fund’s other investments and can include additional risks such as liquidity risk, leverage risk and counterparty risk that are possibly greater than risks associated with investing directly in the underlying investments. The fund may engage in short sales and in doing so is subject to the risk that it may not always be able to borrow a security, or to close out a short position at a particular time or at an acceptable price.
Palmer Square/Fountain Funds
Investments in high-yield bond funds involve additional risks. The Fountain Short Duration High Income Fund principally consists on high-yield corporate debt securities, which are rated below investment grade. The price of such investments may react more to the ability of the company to pay interest and principal when due than changes to interest rates. They have greater price fluctuations and are more likely to experience a default than investment grade securities. Reduced market liquidity for these investments may occasionally make it more difficult to value them. The Fund’s principal risks also include derivatives risk, leverage risk and foreign securities risk which can subject the Fund to price fluctuations not found in funds without these risks. The Fund is non-diversified and may concentrate its holdings in the securities of fewer issuers than that of a diversified fund.
Consilium Fund
The Consilium Emerging Market Small Cap Fund is new with no operating history and there can be no assurance that the Fund will meet its objective. Investments in foreign companies involve risks not generally associated with investment in the securities of U.S. companies, including risks relating to political, social and economic developments abroad and differences between U.S. and foreign regulatory requirements and market practices, including fluctuations in foreign currencies. These risks are greater for Emerging Markets. Investing in smaller companies may be more volatile and less liquid than the securities of large-cap companies. The value of an investment in a REIT can be hurt by economic downturns or by changes in real estate values, rents, property taxes, interest rates, tax treatment, regulations, or the legal structure of a real estate investment trust.
The Convergence Core Plus Fund, Convergence Opportunities Fund, Tortoise North American Energy Independence Fund, Tortoise MLP & Pipeline Fund, Tortoise Select Opportunity Fund, Consilium Emerging Market Small Cap Fund Nuance Concentrated Value Fund and Nuance Mid-Cap Value Fund are distributed by Quasar Distributors, LLC. The Nuance Concentrated Value, Mid Cap Value strategies and Palmer Square products are not affiliated with Quasar Distributors, LLC. Neither Montage Investments nor any of its affiliated investment managers are affiliated with Quasar Distributors, LLC. The Palmer Square funds are distributed IMST Distributors, LLC.
The Separate Account Morningstar RatingsTM (the “Rating(s)”) provided are as of 09/30/2013. The separate account rating is a measure of a separate account’s risk-adjusted return, relative to other separate accounts in the same Morningstar Category. Separate accounts are rated from 1 to 5 stars, with the best performers receiving 5 stars and the worst performers receiving 1 star. Separate accounts are rated for up to three periods (three, five, and 10 years), and ratings are recalculated each quarter. The Morningstar Rating for separate accounts uses an enhanced risk-adjusted return measure, which accounts for all variations in a separate account’s monthly performance, with more emphasis on downward variation. Separate accounts are ranked against others in the same category and stars are assigned as follows: the top 10% of separate accounts in a category earn 5 stars, the next 22.5% 4 stars, the middle 35% 3 stars, the next 22.5% 2 stars, and the bottom 10% 1 star. The Morningstar Category identifies separate accounts based on their actual investment styles as measured by their underlying representative holdings (portfolio statistics and compositions). Ratings are not indicative of Nuance’s future performance. For more information regarding the rating methodology, please contact client.services@nuanceinvestments.com. The Nuance Mid Cap Value Separate Account was rated 5 stars among 94 Mid Cap Value Separate Accounts and Concentrated Value was 5 stars among 374 Large Value Separate Accounts for the three-year period ended 9/30/13.
For each mutual fund with at least a three-year history, Morningstar calculates a Morningstar RatingTM (based on a Morningstar Risk Adjusted Return measure that accounts for variation in a fund’s monthly performance, including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. (Each share class is counted as a fraction of one fund within this scale and rated separately, which may cause slight variations in the distribution percentages.) The Convergence Core Plus Fund received 5 stars among 1,372 Large Blend Funds for the three-year period ending September 30, 2013.
The securities issued under the CLO transactions have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of such securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
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