Institutions interested in the Hartford MidCap Fund can buy new shares again. In December the Hartford reopened the fund to retail investors (see MFWire, 12/16/2008), and now large investors have access to it, too.
"There are a lot of attractively priced mid-cap companies," stated Phil Perelmuter, portfolio manager for the fund. "Opening the Fund to new investors will help allow us to take advantage of these opportunities."
Hartford first closed the fund to new investors in August 2004 (see MFWire, 6/25/2004), a move spokesman Tim Benedict said was driven by capacity. Now, Benedict told MFWire that Hartford sees significant "opportunity" for the fund and new investors.
Company Press Release
Simsbury, Conn., March 3, 2009 – The Hartford’s Institutional Solutions Group has reopened The Hartford MidCap Fund (Class Y Shares) to institutional investors. Additionally, the current market environment has created attractive new investment opportunities for the Fund’s portfolio management team.
Portfolio Manager Phil Perelmuter, who has managed The Hartford MidCap Fund since its inception in 1997, believes the Fund is well positioned to accept new assets. “There are a lot of attractively priced mid-cap companies,” said Perelmuter. “Opening the Fund to new investors will help allow us to take advantage of these opportunities.”
Perelmuter, one of just 15 portfolio managers with a 10-year track record managing mid-cap portfolios, has garnered many industry accolades, including:
Winner of the U.S. Lipper Fund Award1 in the MidCap Blend / Core Category for funds with a 10-year track record (2008)
Named in Barron’s Top 100 Manager List2 five times (2001, 2002, 2003, 2006, 2008)
The Fund, sub-advised by Wellington Management Company, LLP, boasts an impressive historical performance record, having outpaced its benchmark (the S&P MidCap 400 Index) in 9 of the last 11 calendar years. The Fund has also outperformed its Lipper peer group (Lipper MidCap Core) in nine of the last 11 calendar years. (Data Sources: Morningstar and Lipper, 1/09)
According to Morningstar percentile rankings3 (based on total return), the Fund has been a strong performing fund in the Mid-Cap Blend / Core category over all time periods (ended 12/31/08):
25th percentile in its category for 1-year performance (#125 of 505 funds)
13th percentile for 3-year performance (#52 of 414 funds)
4th percentile for 5-year performance (#12 of 328 funds)
4th percentile for 10-year performance (#6 of 156 funds)
Data from Morningstar show that mid-cap stocks have historically performed well following periods of recession. Over the last 30 years, mid-cap stocks have rebounded more strongly than large-cap stocks in the 12 months following the end of the last three official recessions, as determined by the National Bureau of Economic Research (official recession dates were: 7/81-11/82, 7/90-3/91, and 3/01-11/01).
“Historically, mid-cap companies generally have greater growth potential than comparable large-caps, and also offer more seasoned management, greater liquidity and stronger operating histories than many small-cap companies,” said Perelmuter.
“We think there is tremendous value for both current shareholders and new investors in reopening the MidCap Fund at this time,” said Joe Eck, managing director with The Hartford’s Institutional Solutions Group. “We are very pleased to be able to offer institutional clients access to this highly-sought-after mid-cap fund.” He added, “Investing in mid-cap companies is considered by many investors as a core foundation of strategic asset allocation, and the reopening of the Fund further strengthens our lineup of investment options for institutional and high-net-worth investors.” Eck and his team have seen strong enthusiasm and interest in the Fund since it reopened on December 15th. The firm has responded to numerous RFPs and has been notified of several retirement plans selecting the Fund as an investment option.
The Hartford MidCap Fund (Class Y symbol – HMDYX) seeks to outperform the S&P MidCap 400 Index by investing in high-quality, established mid-cap companies with good balance sheets, strong management teams, and market leadership in their industry. The investment approach focuses on meeting three imperatives:
Quality – a focus on industry leaders with high market share
Diversification – attempt to be invested in all 10 sectors of the market
Purity – consistent investment in mid-cap companies
Gross total operating expenses:4 0.79%
12(b)-1 fee: None
Phil Perelmuter is a senior vice president and Managing Partner of Wellington Management, with 24 years of professional experience. He earned his BS from Princeton University and his MBA from Harvard Business School. He is supported by Wellington Management’s broad, deep, and experienced research team.
About The Hartford Institutional Mutual Funds
For institutional investors, The Hartford offers a wide range of funds and share classes to meet varying investment objectives, expense level needs and intermediary compensation requirements. In total, The Hartford offers more than 30 distinct investment options – equity, fixed income, sector funds and asset allocation funds – through two fund families: Hartford HLS Funds and The Hartford Mutual Funds. Hartford HLS Funds are offered exclusively to qualified retirement plans. The Hartford Mutual Funds are available to qualified retirement plans and other institutional investors, such as foundations, endowments and investment companies. For more information on Institutional Solutions from The Hartford, please visit HYPERLINK "http://institutional.thehartford.com" http://institutional.thehartford.com.
About The Hartford
The Hartford (NYSE: HIG) is one of the nation's largest diversified financial services companies and a leading provider of investment products, life insurance and group benefits; automobile and homeowners products; and business property and casualty insurance. International operations are located in Japan, the United Kingdom, Canada, Brazil and Ireland. The Hartford's Internet address is HYPERLINK "www.thehartford.com"www.thehartford.com.
Past performance is no indication of future results.
1 Lipper presents the award annually to the Fund that delivered consistently solid performance compared to its peers. A Fund’s consistent return score evaluates risk-adjusted performance, adjusted for volatility, relative to its peers, for the performance period ending December 31, 2007. The Fund's class Y shares (institutional share class) received the award; all of the Fund's share classes are managed by the same portfolio manager.
2 Barron’s Ranking Methodology: Value Line screened 1,008 equity funds, first eliminating offerings with more than two lead managers and managers with less than three years' tenure. The ranking is based on the performance of the manager with the longer tenure, and comanagers must share day-to-day management of the fund. The survey is then organized by nine investment objectives. This year's survey includes funds with assets of $200 million or more. Only 564 managers qualified for ranking (on the basis of the oldest share class of each fund). Managers were scored based on how much risk-adjusted value they added relative to others with the same Value Line investment objective.
The system uses volatility as a proxy for risk, rewarding a higher score to the managers who generate more stable returns. For example, if a fund's return is judged to be 25% more volatile than its peers—on a monthly basis over the manager's tenure—it is expected to generate 25% greater returns. Superior managers get positive scores commensurate with the value they've added to a fund's performance on an annualized basis. A manager with a 10% rating, for example, has added 10% to performance, above and beyond the average return for a particular investment objective.
3 Morningstar percentile rankings are based on total return and do not include sales charges.
4The gross total annual operating expense shown is before management fee waivers or expense caps. Performance information may reflect historical or current expense waivers or reimbursements, without which performance would have been lower. For more information on waivers / reimbursements, please see the prospectus.
Some of the statements in this release may be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. We caution investors that these forward-looking statements are not guarantees of future performance, and actual results may differ materially. Investors should consider the important risks and uncertainties that may cause actual results to differ. These important risks and uncertainties include those discussed in our Quarterly Reports on Form 10-Q, our 2007 Annual Report on Form 10-K and the other filings we make with the Securities and Exchange Commission. We assume no obligation to update this release, which speaks as of the date issued.
The Hartford MidCap HLS Fund will remain closed.
Mid cap investing generally have higher risk and return characteristics than large-company stocks.
A portion of the fund may be invested in foreign securities, and subject to the associated risks. Please see a prospectus for the current percentage.
The Hartford Mutual Funds are underwritten and distributed by Hartford Investment Financial Services, LLC and Hartford Securities Distribution Company, Inc.
"The Hartford" is The Hartford Financial Services Group, Inc. and its subsidiaries.
Wellington Management Company, LLP is an independent and unaffiliated sub-adviser to the Hartford.
You should carefully consider investment objectives, risks, and charges and expenses of The Hartford Mutual Funds before investing. This and other information can be found in the Funds' prospectus, which can be obtained from your investment representative or by calling 888-843-7824. Please read it carefully before you invest or send money.