Ellyn McColgan, a contender for the Fidelity crown suddenly left the company, leaving succession to Ned Johnson as much a mystery as ever. The media seems to think she left because she was dissatisfied with having to report to newly added Roger Lawson, who was an extra layer between her and Mr. Johnson. The reality is that Fidelity has been getting walloped in the market and maybe Johnson felt the need to hold those running the ship accountable. Fidelities funds have provided average returns for the last couple of years and its competitors have blown by. Vanguard is now the larges mutual fund company, having taken the honor from Fidelity. In addition, fund flows into Vanguard and American Group have been roughly 9 times what has gone into Fidelity through June of this year.
If I were Ned Johnson I'd have to take a hard look at the company's performance and decided if I wanted to stay the course or change ship. It looks like he has chosen the latter.
Other places to read about this:
Fidelity Press Release Announcing Departure - Fidelity
Dangerous Job Claims One More - Boston Globe
Fidelity's latest executive adieu - Fortune
Related Articles:
Question of succession looms large for Fidelity by PhilR - Jul 16, 2007
Fidelity Launches No Fee Checking Account that Pays 3.5% by BankMan - Aug 27, 2007.
