Vanguard has dropped AXA Rosenberg Group as a sub-advisor of the Vanguard Explorer, Vanguard U.S. Value and Vangaurd Market Neutral funds, replacing the oversight with its own Quantitative Equity Group, Vanguard said Thursday.
Four months ago, AXA Rosenberg experienced a computer "coding error" in its quantiative modeling strategy. However, Chris McIsaac, who runs the portfolio review department at Vanguard, tells this morning's edition of The Wall Street Journal, "There was no one issue" that led to the decision to dismiss AXA from the three funds.
McIsaac added that when the coding error happened in May, AXA told Vanguard that the Vanguard Market Neutral fund was not affected, and AXA was unable to find the cause for the error.
An AXA Rosenberg spokesperson told WSJ: "We don't believe it's appropriate to comment on any specific client decision. We highly value the relationship we have with Vanguard and respect their choice."
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