Quantcast
The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:Who is that Dogging Fidelity? Not Rated 0.0 Email Routing List Email & Route  Print Print
Thursday, March 28, 2002

No 2
Who is that Dogging Fidelity?

by: Sean Hanna, Editor in Chief

Sales at Dodge & Cox Funds skyrocketed eleven-fold in February to $800 million, according to Financial Research Corp (FRC). The firm managed increase sales from $72 million in February 2001 without spending a dime on advertising, reports Dow Jones. Instead, the firm's funds are selling primarily to large 401(k) plan sponsors based on investment performance.

The fund firm finished the month in second place behind Fidelity in net fund sales as measured by FRC. In the past year Dodge & Cox has seen its asset base swell by 53 percent. Fully seventy percent of sales have been through institutional channels, mostly to defined contribution plans.

That channel is dominated by investment consulting firms and has openings for just a few products to squeeze through since only the top few products in each category get a hearing. Rather than advertising, firms in that space typically rely on dedicated consultant relationship managers.

The feast or famine nature of that distribution channel is shown by the fact that most of the sales are going to the firm's large-cap value. The Dodge & Cox Stock Fund pulled in some $459 million in February. The firm offers three other funds including a balanced fund, a fixed-income fund and an international fund that debuted in April.

Distribution for the fund was undoubtedly given a boost by the fact that value is the flavor of the moment. Indeed, the demand for value products is such that many funds are being closed to new investors.

While Dodge & Cox may find demand for its fund to be ephemeral, the group does have an opportunity that may be missed by fund shops closing the doors to their products that are basking in their moment in the sun.

Defined contribution plan participants tend to not move funds once they have been allocated. By some estimates, up to eighty percent of 401(k) investors never reallocate money. That tendency makes it difficult for new funds to gather assets in a plan, even if they have won a spot in the core lineup of funds.

The flipside is that assets allocated to that fund remain sticky. From a business perspective, that participant behavior suggests fund firms should make hay while the sun shines because the clouds are likely to return and when they leave a different product is likely to be in the lead.  

See the list of all the 2002 Most Influential People



Stay ahead of the news ... Sign up for our email alerts now
CLICK HERE

0.0
 Do You Recommend This Story?



GO TO: MFWire
Return to Top
 News Archives
2020: Q3Q2Q1
2019: Q4Q3Q2Q1
2018: Q4Q3Q2Q1
2017: Q4Q3Q2Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Raw XML
Add to My Yahoo!
follow us in feedly




©All rights reserved to InvestmentWires, Inc. 1997-2020
14 Wall Street | 20th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use