The top-performing equity managers for the year ended Sept. 30 continued to be powered by energy strategies, but surging growth, small-cap and smid-cap strategies also fueled a shakeup among the 10 best-performing separate account equity managers, according to Morningstar Inc.'s Separate Account Monitor database.
For the second consecutive quarter, Wellington Management Co., Boston, was the top-performing equity manager, posting a 78% return for its energy strategy. Next was the Mitchell Group Inc., Houston, with a 61.3% return on its publicly traded energy strategy, which retained its No. 2 spot for the second quarter in a row.
"It's been steady for us for a while now, but with the rising prices of gas and oil, coupled with two hurricanes, the numbers have picked up even more," said Rodney Mitchell, president and chief investment officer of the Mitchell Group.
But the rest of the top 10 list looks different from the last quarter, when it was dominated by real estate strategies. Those firms were replaced in the third quarter by three growth and five small-cap and small-cap-to-midcap managers.
Strategies managed by Husic Capital Management, San Francisco, were in the third and fourth slots. The firm's Classic Hedge strategy, an unleveraged long-short hedge strategy that aims to beat the S&P 500 index, returned 44.4% for the year; and its Classic Growth strategy returned 43.7%.
GW Capital Inc., Bellevue, Wash., jumped into the number five spot, returning 43.6% in its small-cap strategy. Cortina Asset Management LLC, Milwaukee, was next, returning 42.9% on its small cap-strategy, followed by PENN Capital Management, Cherry Hill, N.J., with a 42.5% return on its small-cap-to-midcap strategy; Bear Stearns Asset Management, which returned 39.9% on its small-cap-to-midcap strategy; James Investment Research, Alpha, Ohio, with a 39.2% return on its Equity Fund Management strategy; and Columbus Circle Investors. Stamford, Conn., which returned 37.6% on its small-cap strategy.
The Dow Jones Energy index returned 50.67% for the year, while the Russell 2000 returned 17.95% and the S&P 500, 12.25%.