ClearBridge is a New York–based global investment management firm with a legacy dating back to 1962. Its small-/mid-capitalization team seeks to invest in quality growth companies that are category leaders (or have the ability to become market leaders) and display capital allocation discipline aimed at fueling long-term sustainable growth.

“The investment professionals in Vanguard’s Portfolio Review Department continuously scour the globe for top-tier talent to enrich our active management capabilities,” said Vanguard Chairman and CEO Bill McNabb. “The addition of ClearBridge’s experience and expertise, particularly in the small- and mid-cap market segments, brings further depth to the fund and to our diverse active management roster.”

The Explorer Fund is a small- to mid-cap growth equity fund that has used a multimanager approach since 1990. Assets formerly managed by Granahan and Kalmar (approximately 25% of the portfolio) will be allocated to Stephens Investment Management Group, LLC (SIMG), Vanguard Quantitative Equity Group (QEG), and ClearBridge.

The fund will now use five advisors, with the following expected allocation of assets: Wellington Management Company LLP, 34%; QEG, 18%; Arrowpoint Asset Management, LLC, 15%; ClearBridge, 15%; and SIMG, 14%; with the remaining 4% in equitized cash investments.

The expense ratios for Investor Shares and Admiral™ Shares of the Explorer Fund are not expected to increase. The fund’s investment objective and principal investment strategies will remain the same. Its characteristics—including valuations, market capitalization profile, and sector allocations—will be substantially similar to what they were previously.

Vanguard’s enduring approach to active management

Vanguard’s active management history can be traced back to 1929 with the founding of Vanguard Wellington™ Fund and is rooted in a distinctive and time-tested philosophy. Vanguard believes actively managed funds can play an important role in a portfolio if they are low-cost, managed by top talent, and invested for over the long term.

In the evaluation of new and existing managers, Vanguard focuses on four key drivers of investment success: the firm, the people, the philosophy, and the investment process. Vanguard’s use of a multimanager structure enables each manager to focus on longer-term opportunities in which they have the most conviction.

Vanguard purposely combines high-quality managers employing distinct investment strategies that are complementary to the other managers in the fund. Managers are complementary in that they have limited holdings overlap, style biases, and resultant correlation of excess returns. This approach provides the potential for long-term outperformance and can help reduce the variability of excess returns.

About ClearBridge

ClearBridge managed approximately $120 billion in assets across 32 domestic, international, global, and specialty equity strategies as of February 28, 2017. The firm is an independently managed, wholly owned subsidiary of Legg Mason, Inc.

The four portfolio managers responsible for day-to-day management of ClearBridge’s portion of the Explorer Fund are:

  • Jeffrey Russell, CFA, who joined ClearBridge in 1990 and has worked in investment management since 1981. He earned a B.S. from Massachusetts Institute of Technology and an M.B.A. from The Wharton School of the University of Pennsylvania.
  • Derek Deutsch, CFA, who joined ClearBridge and began working in investment management in 1999. He earned a B.A. from Brown University and an M.B.A. from Georgetown University.
  • Brian Angerame, who joined ClearBridge in 2000 and has worked in investment management since 1994. He earned a B.A. from Dartmouth College.
  • Aram Green, who joined ClearBridge in 2006 and has worked in investment management since 2001. He earned a B.A. from Union College.
They are supported by a team of three analysts and also benefit from the firm’s broader investment resources, including a 12-member central research team.


All asset figures are as of February 28, 2017, unless otherwise noted.

All investing is subject to risk, including the possible loss of the money you invest.

Prices of small- and mid-cap stocks often fluctuate more than those of large-company stocks.