Is the momentum in the fund industry shifting? The reason to ask was provided by the Massachusetts pension fund. Not only has the giant defined benefit plan rehired Putnam Investments just a year after it fired the Boston money manager, it has also dumped the advisor to American Funds from its roster of managers.

Los Angeles-based Capital Guardian Trust, a sister unit of Capital Research & Management, lost the $950 million mandate for the Massachusetts' plan due to poor performance, according to the L.A. Times.

Michael Travaglini, executive director of Massachusetts' Pension Reserves Investment Management Board (PRIM), called the removal of Capital Guardian "one of the most difficult decisions we've been confronted with in a while." He added that the fund added "an incredible amount of value" before adding that "our board had a loss of confidence in Capital's ability to replicate that success going forward."

Travaglini explained that Capital Guardian lagged its benchmark foreign indexes for more than three years and returned just 3.3 percent annually for the past three yeras (before fees) compared to the 3.9 percent annualized return of Morgan Stanley's EAFE.

The Massachusetts PRIM plan is influential with other public plan sponsors. It decision both to rehire Putnam and to let go Capital Guardian may signal a shift in the prevailing winds in the DB mandates game.

For the past year many plan sponsors have kept Putnam in the penalty box, either not adding the Boston manager's products or firing them from existing mandates. Meanwhile, Capital Research's American Funds have been one of the hottest products on the market.

At least for international mandates, that may be changing. 

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