Smith Barney ends exclusive Legg fund deal

Smith Barney's exclusive deal with Legg Mason to distribute funds run by Bill Miller has come to an end.
MAR 03, 2009
By  Bloomberg
Smith Barney's exclusive deal with Legg Mason to distribute funds run by Bill Miller — the Legg portfolio manager best known for beating the markets for 15 consecutive years — has come to an end. The marketing pact, which was inked in 2005 after Baltimore-based Legg Mason Inc. swapped its brokerage battalion for the asset management business of New York-based Citigroup Inc., Smith Barney's parent, has expired and will not be renewed, Legg Mason spokeswoman Mary Athridge confirmed. Now, all of the funds managed by Mr. Miller's Legg Mason Capital Management, including his once-vaunted Legg Mason Value Trust, can be distributed through any brokerage. Ms. Athridge said New York-based Smith Barney's impending merger with the brokerage business of Morgan Stanley of New York played no role in ending the marketing pact with LMCM, and added that the agreement simply expired on Feb. 19. She also pointed out that the marketing agreement was tweaked in September 2007 to give Smith Barney brokers exclusive rights to distribute only the primary shares of LMCM's funds. Mr. Miller's run of beating the Standard & Poor’s 500 stock index for 15 consecutive years came to an end in 2006 when the Value Trust's 5.9% return lagged the index by 9.9 percentage points, according to Morningstar Inc. of Chicago. He has continued to underperform the benchmark since then. In 2008, the Value Trust lost 55.1%, underperforming the S&P 500 by 18.1 percentage points, according to Morningstar.

Latest News

SEC bars ex-broker who sold clients phony private equity fund
SEC bars ex-broker who sold clients phony private equity fund

Rajesh Markan earlier this year pleaded guilty to one count of criminal fraud related to his sale of fake investments to 10 clients totaling $2.9 million.

The key to attracting and retaining the next generation of advisors? Client-focused training
The key to attracting and retaining the next generation of advisors? Client-focused training

From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.

Chuck Roberts, ex-star at Stifel, barred from the securities industry
Chuck Roberts, ex-star at Stifel, barred from the securities industry

"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.

SEC to weigh ‘innovation exception’ tied to crypto, Atkins says
SEC to weigh ‘innovation exception’ tied to crypto, Atkins says

Chair also praised the passage of stablecoin legislation this week.

Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest
Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest

Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.