SEI has made the decision to remove AllianceBernstein from the SGMF U.S. Small Companies Fund (the Fund) as at 30 November 2016.

Rationale

AllianceBernstein has been terminated from the Fund for several reasons. The Fund is shifting assets in a defensive direction, and AllianceBernstein’s higher exposure to volatility contradicts this objective.

In addition, AllianceBernstein has struggled to keep pace with its benchmark. Specifically, the strategy lagged during the first quarter’s downturn, bouncing back in the second quarter as markets normalized, but was unable to keep up in the third quarter’s “risk-on” rotation ― an environment that could have been expected to accommodate AllianceBernstein’s approach.

Finally, the strategy’s large asset base and evolving team structure have dampened our expectations for its future performance. A large asset base can be particularly unwieldy to manage in the small-company universe.

AllianceBernstein remains an investment manager in other SEI funds. We are confident in its abilities and do not anticipate additional changes.

When a manager is removed from the manager line-up in one of SEI's Funds, a letter is sent to the affected manager announcing this action. In order to protect market-sensitive information, SEI will not communicate a manager removal to clients until all trades have been finalised. This may mean that there is a delay between SEI legally notifying a manager of their removal from the line-up of a Fund and a manager change memo being issued to our clients. In the meantime, all SEI deliverables and communications will continue to show this manager in the line-up of the Fund/s until the next regularly scheduled update. Communications will not be retroactively amended. The "effective date" date quoted in the manager change memo reflects the effective date quoted in the termination letter sent to the manager by SEI.

IMPORTANT NOTE: The opinions and views contained in this document are solely those of SEI and are subject to change; descriptions relating to organisational structure, teams and investment processes herein may differ significantly from those prescribed by underlying managers regarding their own investment houses and investments.
 

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