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Analysis: On March 8, it was announced that Dana Love, manager of the Trimark Fund, had resigned from the company.
He will be replaced by Michael Hatcher, who has been co-manager on the fund for the past year or so. He will be supported by the current co-managers Darren McKiernan and Jeff Feng.
From an optics standpoint, this is yet another blow to the venerable Trimark franchise, which over the past few years has seen a near complete changing of the guard within the portfolio manager ranks. It is also very disappointing because the fund had begun to show a marked improvement in performance on both an absolute and risk adjusted basis.
But digging deeper, this may not be as big a blow as first thought. Dana Love is being replaced by a very capable team which has worked together for a number of years, the last two of which were at Trimark. Before that, they were at Burgundy Asset Management. This is important to note becauseBurgundyuses a fundamentally driven bottom up investment management approach that is very much like that which is employed within the Trimark discipline. Both firms have a reputation of seeking out strong, well managed, financially sound companies that are trading at a significant discount to their intrinsic value.
The other factor which causes us to not pull the panic switch at the moment is that the team has been working on this fund since April of last year. They are very familiar with the fund, the process, and, most importantly, the names in it. Thus far it is expected that there will not be a significant amount of portfolio turnover, nor is there expected to be any fundamental change in the way in which the fund is managed.
While our preference would have been for Dana Love to remain with the fund, we feel that there is a strong team replacing him. Under the new regime, we do not expect a significant change to the fund. Despite that, we will be placing the Trimark Fund UNDER REVIEW immediately. We will be meeting with the new management team in the coming weeks to discuss their approach and any further changes which are expected to the fund. We will continue to monitor the fund to ensure that there is not any significant erosion in the risk reward profile.