Big News on the Manager Change Front
At 3PM today Fidelity will announce that Joel Tillinghast will be taking a leave of absence from running Low Priced Stock from September through the end of December. Joel is not ill. He has requested a leave to see a bit of the world. He'll head to the CLSA conference in Hong Kong, and continue to mentor analysts and first year managers while also retaining the oversight of the fund; no position in his top 50 holdings will be built or winnowed without his say so. He will be replaced in the interim by a team of hand picked managers, managers Joel has selected, and his lead pick is Jamie Harmon, manager of multiple funds at Fidelity (small cap funds). Jamie has a stellar track record relative to benchmark and comparable to Joel's. Harmon works directly under and with Joel. His style is highly correlated as is his philosophy and discipline. Joel says he will be back, but there are no guarantees … none that I know of. Harmon and the team have been working closely with Joel in advance of this announcement. Joel will be weighing in regularly and available 24X7 for consultation before any major changes in holdings, sector weightings, foreign percentage, etc. While hardly the same as having Joel at the helm, team Joel have been working together since mid-March to prove out in practice what will now become a reality. The holdings, process, etc. are deeply well known by the team.
For now, I do not think the announcement merits a sell or hold on new purchases. But, we will be working on an appropriate substitute should Joel not return in December.
Harmon believes Joel will return; "he is a man of his word, he's fully engaged, I have no doubt that he'll be back".
The head of Team Joel is well known to us. Jamie Harmon was a top-ranked manager while running the retail Small Cap Retirement and Small Cap Independence, and his performance since taking over Advisor Small Cap compares favorably with Tillinghast’s performance as the table below attests. Click here to download the PDF.
FI Members note: In our July 2011 retail fund manager rankings Harmon’s Advisor Small Cap fund ranks above Tillinghast. Good news.