Bridgeway Capital Management of Houston has reached an agreement with Calvert Group of Bethesda, Md. to add the Bridgeway Social Responsibility Portfolio to the Calvert fund family. The fund will be renamed the Calvert Large Cap Growth Fund.
The two companies filed a proxy statement with the SEC August 18 to seek shareholder approval, in anticipation of offering the new fund on Oct. 31.
Although the Bridgeway Social Responsibility Portfolio has generated an average return of 27 percent in its six years of operation and has repeatedly been awarded five stars by Morningstar of Chicago, it has only attracted $8 million in assets.
John Montgomery, president of Bridgeway Capital and portfolio manager of the fund, attributed the small following to his company's limited distribution. Calvert, which has a well-established reputation as a socially-responsible investment leader, should improve the fund's distribution considerably, Montgomery said.
"Calvert Fund has a different distribution method than the one used by the present portfolio, [which] is a no-load fund," the proxy solicitation said. "The Calvert Fund has different classes of shares, which are sold by its distributor through a network of financial advisers and retirement plan platforms."
Even though Calvert has more extensive distribution channels, expenses for Bridgeway Social Responsibility Portfolio will decline once it is absorbed by Calvert, according to the SEC filing. Bridgeway currently charges fees ranging from 1.24 percent to two percent, according to the filing. The Calvert Large Cap Growth Fund will charge 90 basis points, according to the filing.
Bridgeway will continue to sub-advise the fund and the transaction will be tax-free, the filing said.
