In an effort to grow its Asset & Wealth Management business in the U.S., Deutsche Bank
is transferring some of the strategies previously run by the bank into the asset management unit, as well as launching new funds, hiring people from other large investment firms and focusing its portfolio management activities on the U.S.
Most recently, the firm launched its DWS CROCI Sector Opportunities Fund
via Deutsche Bank's Cash Return on Capital Invested (CROCI) methodology and team. The group, headed by Joe Hall
in the Americas, has been transferred from the bank to the asset management division and has taken over the management of two underperforming funds, an international stock fund that had about $850 million under management, and an equity dividend fund that had about $1.25 billion. Hall declined to say what became of the team that managed those funds. Hall's own team is 60 people strong.
The new mutual fund evaluates companies based on their ability to make cash returns on their investments. The fund targets about 30 stocks from the S&P 500 index, STOXX Europe Large 200 Index and TOPIX 100 Index. It uses a fundamental stock picking process.
The team managing the funds that were taken over by CROCI was based out of Germany, but Hall said the firm wants to have PMs managing its U.S. funds on this side of the Atlantic now. While DeAWM is a global investment firm, "the U.S. is very much a focus and a priority for us," Hall said. "There is a very high focus and a real premium being put on asset and wealth management and it's never going to succeed if it doesn't succeed here in the U.S.," he added.
"That mirrors the other funds that are being launched, including long/short equity and other teams that have been brought in, like a mid-cap value team. This reflects the emphasis being put on the U.S.," he added. CROCI strategies have $13.25 billion under management outside of the U.S. and Hall said the group could be much larger once it has U.S. investments.
Deutsche also launched its DWS Strategic Equity Long/Short Fund
, which uses hedge fund managers Omega Advisors
, Atlantic Investment Management
, Chilton Investment Company
and Lazard Asset Management
as sub-advisors, last month.
And last year, Deutsche brought on Richard Glass
as head of small- and mid-cap value equities and Mary Schafer
as a PM in that group. They were both previously co-founders at value equity manager Lockwell Investments
, which had shut down, and before that they ran these strategies for Morgan Stanley Investment Management
. Richard Hanlon
also joined the small- and mid-cap value team at Deutsche at that time from Glenville Capital Management
, a firm he founded.
Deutsche also moved its bank-based ETF business into the asset management unit in the end of 2012 and more strategies could follow suit. The bank created the unified Deutsche Asset & Wealth Management
unit in the summer of 2012. It combined the DWS Americas, DB Advisors, Deutsche Insurance Asset Management and RREEFF businesses under one roof after Deutsche failed to find a buyer for any of these units. A deal with Guggenheim Partners
had reportedly fallen through, as the two firms couldn't agree on a price. The asset management division currently has $366 billion in U.S. assets, of which $93.2 billion is in DWS Funds
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