The Vanguard Group says it has been in talks with Charles Schwab Investment Management about the re-organization of the Laudus Rosenberg U.S. Large/Mid Capitalization Long/Short Equity Fund (RMNIX) into a new Vanguard fund. The $21 million open-end fund is sub-advised by AXA Rosenberg Investment Management LLC.
The fund’s shareholders will receive further details about the proposal in October, with a special meeting slated for mid-November. As part of the proposal, Vanguard has filed a registration statement with regulators for the Vanguard Market Neutral Fund. The new no-load fund would seek to provide long-term capital appreciation while limiting exposure to general stock market risk by using a long/short market-neutral strategy.
AXA Rosenberg, based in Orinda, Calif., would continue to serve as an investment advisor of the reorganized fund, while the Vanguard Quantitative Equity Group would also manage a portion of the fund.
“We view the adoption of the fund as an opportunity to expand our relationship with a respected advisor and bring a new investment strategy to our institutional clients through a relatively low-cost fund with an established track record,” says Vanguard CEO Jack Brennan.
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Vanguard added AXA Rosenberg to the advisory teams of the $12 billion Vanguard Explorer Fund (VEXPX) and the $1.4 billion Vanguard U.S. Value Fund (VUVLX) in June. AXA Rosenberg manages 12 percent of the Explorer Fund and 50 percent of the U.S. Value Fund, according to the fund company.
Vanguard expects the new fund will require minimum initial investments of $250,000 for investor shares and $5 million for institutional shares.