Fidelity’s Team Canada moves to Canada

Fidelity Investments Canada announced Wednesday that Team Canada, its well-regarded 25-member Canadian equities research and portfolio management group, will be relocating to Canada from its current Boston headquarters. However, it does so without long-time leader, Bob Haber.

Fidelity’s Team Canada is an anomaly; its leadership was not located in Canada. Nevertheless, the team has a very impressive track record managing some of Canada’s most successful mutual funds, including Fidelity True North, Fidelity Canadian Disciplined Equity Fund and Fidelity Canadian Balanced Fund.

Fidelity Canada believes the move will help the firm capitalize on the sales momentum it’s already achieved in the Canadian space. The company says it was the sales leader in Canada in 2008, with long-term mutual fund net sales of over $2.6 billion. Its institutional arm, Pyramis Global Advisors, is now the 20th-largest institutional asset manager in Canada, up from 30th in 2006.

“The new Canadian offices are just the latest of several new Fidelity offices around the world and are one more sign of Fidelity’s long-term commitment to the Canadian market,” says Rob Strickland, president of Fidelity Canada.

The move is somewhat bittersweet for the firm because it will be losing Bob Haber, Fidelity Canada’s long-time chief investment officer and an important architect of Team Canada’s success.

Haber told Advisor.ca that the team was incubated in Boston in order for Fidelity to instill its unique brand of stock-picking. Many of the team members are Canadian citizens, and he feels they are well versed enough in the investment process and philosophy of Fidelity that they can move operations to Canada. However, he says, for him, Boston is home.

“What will be nice about that is all the people going to Canada are Canadian citizens; they have families and friends there. They have grown older as a team, and they have kids now; it will be a better lifestyle for them,” he says. “While I would certainly like to join my colleagues in Canada, my family, friends, and love of the Boston Celtics keep me rooted here in Boston. Now that Team Canada’s transition to Toronto and Montreal is well underway, I have decided that it is time to move on to a new chapter in my life and will be taking a step back from active daily management later this month.”

Haber says he will continue to be involved with the markets and maintain a relationship with Fidelity, but he’s relinquishing his day-to-day management duties on the funds he manages over to other members of Team Canada, and handing the CIO reins over to Andrew Marchese, the team’s current director of research.

“Andrew Marchese was one of the first people who was hired into Team Canada 11 years ago. He’s going to be taking over the primary day-to-day leadership of the team. He’s been a fund manager and the director of research,” Haber says. “None of the effective funds are going to change their style or philosophy, although obviously there will be [lead] fund management changes that occur.”

Independent fund analyst Dan Hallett, president of Dan Hallett and Associates, doesn’t anticipate that either Haber’s departure or the move to Canada will have too much of a material impact for advisors and investors.

“To a certain extent, this plays into Fidelity’s messaging that there is no individual that is bigger than our process and organization,” he says. “It’s hard to say it’s an insignificant move, but from an advisor’s perspective, I don’t see a lot of change here. They’ve been running Canadian equity money for a lot of years without having a presence here. I don’t know that this necessarily makes them better at that.”

Hallett points out that one quick benefit is that marketing to the Canadian market will be made much easier by the sheer fact that the managers and research team will be in Canada.

Haber, who says the research capabilities will be moved to Toronto by the end of the fourth quarter, believes the easier access investors will have to Team Canada will only enhance their appeal.

“From a business standpoint it will definitely be a big win for our advisors, and hopefully us. Within minutes of many of our advisors and broker clients, we’re going to have two offices, in Toronto and Montreal,” he says. “I expect our exposure will go up dramatically, and not just the amount of exposure, but the depth and breadth of that exposure. Hopefully advisors who are interested will have a chance to see the research engine and personnel, and that can only help us.”

Haber said building up the personnel of that team was one of his proudest accomplishments.

“When I took over at Fidelity Canada, we had $4 billion in total assets under management in really just two or three funds,” he says. “We have had the number one sales year, and by many measures we’re the number one performance fund family. We’re multiple products and multiple distribution channels, and we’re multiple times that $4 billion now. Having had a key hand in building a large and successful business and all the people whose career that has helped, that’s going to be the highlight of my 24 years at Fidelity.”

(03/04/09)