Schwab Launches Four
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Tuesday, June 04, 2002

Schwab Launches Four

Charles Schwab is introducing its Schwab MarketMasters Funds, a spokesperson with the firm told the These are designed to be multi-manager funds managed by the firm and sub-advised by other independent investment managers. The new offerings are available this week.

"They are designed to be 'manager-of-manager funds', so to speak," the spokesperson reported. "They are taking the place of our MarketManager portfolios, which were more funds-of-funds." In the MarketMasters Funds, Schwab allocates assets across the multiple investment managers. Schwab contends that it continually monitors those managers as well.

The firm is of the opinion that this new suite will offer heightened diversity across the asset classes and investment style spectra. Schwab executives will select the investment managers but also continue to work with them to ensure that investment styles are complimentary.

"Schwab chose investment managers through a stringent and rigorous qualitative and quantitative review process," opined Jeff Mortimer, vice president and senior portfolio manager at Schwab. "We measured each manager's performance against peers and benchmarks, with a focus on investment discipline, overall experience and strong long-term performance in varying market conditions. Some of the investment managers selected run mutual funds that are closed to new investments or manage only institutional assets, meaning the MarketMasters Funds offer access to individual investors that they otherwise would not have."

Here is how the sub-advisors break down:
  • Schwab International MarketMasters Fund (SWOIX): American Century, Artisan Partners, Harris Associates, and William Blair.
  • Schwab Small-Cap MarketMasters Fund (SWOSX): Royce & Associates, TCW, Tocqueville Asset Management, and Veredus Asset Management.
  • Schwab Balanced MarketMasters Fund (SWOBX): Aronson + Partners, Berger Financial Group, Perkins, Wolf, McDonnell & Co., Eagle Asset Management Inc., and PIMCO.
  • Schwab U.S. MarketMasters Fund (SWOGX): Eagle Asset Management, Harris Associates, TCW, and Thornburg Investment Management.

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