BOSTON, Oct 17 (Reuters) - Taking a page from his last job, Eaton Vance’s new Chief Equity Investment Officer bets that reorganizing his analysts into new teams will boost performance.
Since joining the Boston company in April from Goldman Sachs, Edward Perkin has regrouped Eaton Vance’s 27 stock analysts into teams meant to develop investment ideas that match the strategies of the firm’s various funds.
That marks an important change from the past, when a central pool of analysts advised many different portfolio managers.
The idea is to improve returns in Eaton Vance Corp stock funds, which have posted mixed performances and outflows in recent years.
“We have got good people,” Perkin said. “It’s more about the structure of the department.”
Eaton Vance has about $17.8 billion in stock funds overseen by Perkin that have suffered about $2.3 billion in net withdrawals so far this year, according to Thomson Reuters’ Lipper unit.
Along with performance concerns, investors have lost enthusiasm for the large-cap sector overall.
Morningstar analyst Greg Carlson said it is hard to know if Perkin’s shifts will be enough. While having strategy-specific research teams has worked for Goldman, Carlson noted that competitors such as T. Rowe Price Group and Fidelity Investments still use centralized groups of analysts.
Eaton Vance may need bigger changes, Carlson said.
“For as long as I can remember, Eaton Vance’s in-house equity funds, on average, haven’t been particularly great or terrible. They’ve been middle-of-the-road,” he added.
Perkin, 42, replaced Duncan Richardson, who retired last fall after 26 years with the firm. Perkin most recently worked for Goldman in London and said he is considering expanding Eaton Vance’s London office to include analysts or portfolio managers as he creates more global funds. Perkin’s division manages about $6 billion in global equities, a figure he said could be “many times that.”
Perkin was also named co-manager of the $4.3 billion Eaton Vance Large Cap Value Fund, which two other co-managers left in May. It has returned 1.53 percent so far in 2014, beating 75 percent of its peers, according to Morningstar, after a period of weak performance.
One new holding since Perkin took over is logistics firm C.H. Robinson Worldwide Inc, which Perkin said should benefit from the trucking industry’s tight capacity.
Also, Perkin said the fund dropped two airlines, United Continental Holdings Inc and Delta Air Lines Inc, on concerns about their profits and their use of charges such as baggage fees.
“If you can’t charge the full price to your customer and you have to trick them with all these ancillary items, that’s not a good business,” he added. (Reporting by Ross Kerber. Editing by Andre Grenon)