As we began collecing our money fund performance data for the month ended Feb. 28, 2011, we noticed a couple of changes in our fund listings. The GE Money Market Fund has recently been renamed Highland Money Market Fund II, and the Scout Money Funds appear to be approaching their full final liquidation dates. See the Prospectus supplement for the GE Money Fund changes, and see our Dec. 8, 2010, Link of The Day, "Scout to Liquidate Money Funds". (Note that Crane Data will be removing these funds from our pending March issue of Money Fund Intelligence, which is due out Monday.)
The Highland filing says, "Effective today, Highland Funds Asset Management, L.P. is now the investment adviser for each Fund. GE Asset Management Incorporated is now the investment sub-adviser responsible for the day-to-day portfolio management for each of the Funds, other than Highland Small-Cap Equity Fund, which continues to be sub-advised by Palisade Capital Management, L.L.C. and Champlain Investment Partners, LLC.... Such changes were approved by the Board of Trustees of the Trust on September 20, 2010, subject to the approval of the shareholders of the Funds, and subsequently approved by shareholders of the Funds on December 21, 2010."
It continues, "The proposals, as approved by shareholders, are described below. For all Funds: 1. A new investment advisory agreement for each Fund with Highland, to replace the current advisory agreement between each Fund and GEAM.... 2. New sub-advisory agreements between Highland and GEAM, and new sub-advisory agreements between Highland and certain of GE Small-Cap Equity Fund's existing sub-advisers, as follows: A. a new sub-advisory agreement with GEAM for each Fund, except GE Small-Cap Equity Fund; B. a new sub-advisory agreement for GE Small-Cap Equity Fund, with its existing sub-adviser, Palisade; and C. a new sub-advisory agreement for GE Small-Cap Equity Fund, with its existing sub-adviser, Champlain."
A previous press release says, "GE Asset Management today announced that the GE Funds Board of Trustees has approved a proposal for Highland Funds Asset Management, L.P. to become the GE Funds' new investment advisor, pending shareholder approval. Under the arrangement, Highland Funds would serve as the funds' advisor. GEAM would continue to manage the assets of all of the GE Funds.... The GE Funds family is comprised of 16 mutual funds for individual investors with approximately $1 billion in total assets. Highland Funds is an affiliate of Highland Capital Management, L.P., which currently offers a family of mutual funds for individuals and has $2.1 billion in total retail assets under management. The GE Funds' array of offerings complements Highland's lineup and provides Highland with a broader product range."
Assets on several Scout money funds have declined to zero, though several funds remain for now. Our previous story, which quoted from the Scout filing, said, "Upon the recommendation of Scout Investment Advisors, Inc., the Scout Funds Board of Trustees has adopted a Plan of Liquidation to cease operations of the Scout Money Market Fund – Federal Portfolio, Scout Money Market Fund – Prime Portfolio and Scout Tax-Free Money Market Fund and liquidate the Funds. While the Funds have served for many years as high quality money market fund investment options for clients and customers of the Advisor and UMB Financial Corporation, the Advisor has determined that it is no longer economically viable to continue operating the Funds in view of their size and future prospects for growth. The liquidation is expected to be completed in early 2011."
The GE money market fund complex is the 58th largest manager of money funds, as of Jan. 31, according to our monthly Money Fund Intelligence XLS with $822 million. The Scout money funds, formerly the UMB Scout money funds, ranked 59th out of 80 managers tracked by Crane Data with $766 million as of last month.
