Fund Watch: New Long/Short Fund, Liquidation Of Risk Parity Fund
In this abbreviated edition of Fund Watch, we look at one new fund in registration: the Brown Advisory Equity Long Short Fund; and a fund in liquidation: the Parametric Balanced Risk Fund. New Long/Short Fund in Registration Brown Advisory Funds filed paperwork with the SEC on August 14 announcing its plan to launch the Brown Advisory Equity Long Short Fund. The fund, which is expected to debut 75 days after the filing date (roughly October 28), will be managed by the Brown Advisory equity research team, led by the firm’s head of investments Paul J. Chew. The Brown Advisory Equity Long Short Fund’s objective will be to provide long-term capital appreciation. Its investment strategy involves buying stocks the advisory team deems undervalued, and short-selling stocks the team thinks are overvalued. Under normal circumstances, the fund’s net-long exposure is expected to range from 30% to 80%. Its “flexible equity” strategy will invest across market capitalizations, sectors, and geographic markets. Shares of the new fund will be available in investor-, institutional-, and advisor-class shares, with respective net-expense ratios of 2.09%, 2.24%, and 2.49%. The minimum initial investment will be $5,000 for investor-class shares, $1 million for institutional shares, and $2,000 for advisor-class shares. Liquidation of Balanced Risk (“Risk Parity”) Fund According to paperwork filed with the SEC on August 11, the Board of Trustees of the Eaton Vance Growth Trust voted to liquidate the Parametric Balanced Risk Fund (MUTF: EAPBX ) at an August 10 meeting. The fund will cease taking investments from new shareholders on August 21 and is expected to be fully liquidated by August 28. The Parametric Balanced Risk Fund, which debuted less than two years ago, generated one-year returns of -8.74% through July 31, ranking in the bottom 3% of funds in its Morningstar category. From its September 25, 2013 inception through the August 11, 2015 board meeting that sealed its fate, the fund lost about 4% of its value, with a $10,000 investment at its inception falling to a value of $9,601.23, according to Morningstar.