CI appears set to welcome Radlo

Alan Radlo, the popular fund manager who left Fidelity Investments in December 2006, could soon pop up in the Canadian market once again.

A report from CIBC World Markets analyst Stephen Boland says that recent regulatory filings by CI Investments match Radlo’s style and that it is a virtual certainty that he will be named the manager of CI New Canadian Equity Corporate Class, CI New Global Equity Corporate Class and CI New Canadian Asset Allocation when these funds hit the market next year.

“The three funds happen to be the same three mandates that Radlo ran for Fidelity,” says Dan Hallett, president of Dan Hallett and Associates. “The wording of the filing is set up in a way that it looks like they’ll make some changes. For instance, the names are not exactly the most creative.”

The preliminary prospectuses for the three funds do not name a specific manager but simply list “CI Investments,” suggesting they will be managed in-house.

“Without a star manager of some sort, CI does not need another Canadian equity fund,” Hallett points out. “There has to be a pretty good reason for them to be launching one.”

Rumours have persisted that Radlo’s hiatus from the industry would last no longer than his non-compete agreement with Fidelity. There have been rumours since October of this year that CI Investments was wooing him.

Hallett says Radlo’s one-year non-compete agreement was extraordinarily long, with the industry average usually between three and six months.

“That certainly gives the replacement managers on the Fidelity side the chance to put up some numbers and at least start to prove themselves on those mandates,” he says. “That makes it tougher to steal those assets.”

So far, he says, Radlo’s replacements have been doing “reasonably well.”

Radlo’s popularity among advisors and investors makes him a prize catch for any firm, as most fund industry analysts expect his fans to follow him. Hallett points out that even a small percentage of assets from Radlo’s former Fidelity mandates could represent a large increase in CI’s assets under management.

“Some of the assets will follow him, and it will be a combination of some of the new money that would have gone into Fidelity funds had he still been there, along with money that is already over there,” he says.

Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com