Update to Mawer U.S. Equity Research Team
Plan sponsors may wish to consider whether this investment news has any implications for the investment options available within their plans. Sun Life Assurance Company of Canada purchases units of the fund listed below, which is established as a segregated fund in accordance with the Insurance Companies Act (Canada).
In the second half of 2024, Mawer experienced significant turnover within its U.S. Equity research team. The team manages the Mawer U.S. Equity strategy and supports the Mawer Global Equity strategy.
Mawer initiated the departure of two members of the US Equity research team: Colin Wong, Co-PM and Sophie Wang, Analyst. Wong had been a Co-PM on the Mawer U.S. Equity fund alongside Grayson Witcher since 2016. Wang was a more recent addition, joining Mawer in 2021. Witcher will be the sole PM on the fund for the immediate future.
Additionally, Alex Romanowich, Equity Analyst left Mawer for another investment firm. Romanowich spent half of his time on US Mid Cap stock research. Lastly, Mawer shifted Samir Taghiyev from U.S. Mid Cap research to dedicate his time solely to Canadian Small Cap research. Taghiyev had assumed the role of lead PM on Canadian Small Cap in 2024.
The U.S. Equity research team is now comprised of two dedicated individuals, Grayson Witcher, PM and Chris Silvestre, Analyst. The team also receives contributions from two members of the US Mid Cap team, Jeff Mo, PM and Alex Romaines, Analyst, with additional support from newly hired analysts that are part of Mawer’s rotation program.
These departures have an indirect impact on the Mawer Global Equity fund, which leverages ideas generated by the U.S. Equity research team to position the fund’s portfolio. However, the Global Equity PMs are not limited to relying solely on the work of the U.S. Equity research team. They conduct their own research and hold positions not held by the U.S. Equity fund.
GRS Investment Solutions team view
The recent turnover to the U.S. Equity research team raises some concerns about coverage and experience. The team appears understaffed and unbalanced, with only a small number of individuals focused on U.S. Equity research. In comparison, there are 11 PMs and analysts covering EAFE and Emerging Markets and 6 covering Canadian large and small cap equities.
We have some comfort that most of these changes were initiated by Mawer to improve performance. However, we feel that the changes could have been implemented better. There doesn’t appear to be enough bench strength to compensate for the departures in the short term. Our understanding is that there are no further firm-driven team departures anticipated. For the time being there is elevated key person risk with PM Grayson Witcher.
We have placed Mawer U.S. Equity on the GRS Investment Solutions Watch List under Additional Monitoring (least severe category). Mawer Global Equity is already subject to Additional Monitoring due to changes to the PM team as communicated previously. We will continue to monitor Mawer U.S. Equity and communicate further as needed.
Questions?
Please contact your Sun Life Group Retirement Services representative*.