Important Developments at MainStay
The Board of Directors recently approved several product initiatives to certain MainStay. These initiatives were proposed as part of our continued effort to provide best-in-class investment vehicles to help our shareholders and policy owners meet their financial objectives. The following is a summary of upcoming product changes that are indicative of MainStay’s commitment to our investors.
An Overview of Changes
An inherent value of our multi-boutique model is the ability to offer the acumen and expertise of leading institutional investment managers across asset classes and investment styles, including both affiliated and unaffiliated managers.
MainStay’s boutique roster includes Institutional Capital LLC (ICAP) and Winslow Capital Management Inc. (Winslow), two leading institutional equity managers with experienced teams, proven and disciplined investment processes and strong historical track records, providing strength in the management of MainStay domestic large-cap funds.
Based on MacKay Shields LLC’s (MacKay Shields) success and its reputation as a premier fixed-income manager, MacKay Shields has made the strategic decision to concentrate their organizational focus upon their world-class fixed-income capabilities. With two premier high-yield teams, strong core bond and convertible bond teams, and a newly acquired municipal bond group, MacKay Shields continues to add resources to further strengthen its position in the industry. James Ramsay joined last year as co-head of the Core Team, and MacKay Shields recently announced the addition of the well-respected Mariner Municipal Managers team to add the important capability of municipal fixed income. MacKay continues to add institutional accounts and they remain positioned for continued growth. Given MacKay Shields’ strategic decision to focus on its fixed-income capabilities, the Board has terminated its subadvisory agreement between New York Life Investment Management LLC (New York Life Investments) and MacKay Shields on certain equity funds. It’s important to note that Rupal Bhansali will continue to manage MainStay International Equity Fund.
ICAP and Winslow, as well as Madison Square Investors LLC (MSI), will provide continued strength in the management of MainStay’s U.S. equity funds, and have assumed responsibility for several funds previously subadvised by MacKay Shields.
Additionally, we are excited to announce that Epoch Investment Partners, Inc. (Epoch), a well-regarded institutional boutique founded in 2004 and led by CEO William W. Priest, will be assuming subadvisory responsibility for several MainStay equity funds, and will be added as the equity manager to two of our blended funds. Epoch, a global, boutique asset management firm with over $5.6 billion in assets under management as of March 31, 2009, is highly regarded for its high quality institutional management. Additional information about Epoch can be found at www.mainstayinvestments.com/epoch.
To streamline our investment offerings and help to achieve greater economies of scale, several product mergers have also been approved by the Board, which should ultimately provide for greater cost efficiencies and lower fees for shareholders and policy owners.
Impact on MainStay Products
The following table provides a high-level overview of the subadvisor changes and proposed mergers by product. Note that some of these changes require shareholder approval and involve multiple stages. For complete information about each of these initiatives—including complete details about certain product repositionings, subadvisory changes, and mergers—carefully review the enclosed Questions & Answers document has been provided for your reference. In addition, note that the related prospectus supplements dated June 29th, 2009 have been filed with the SEC.
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MainStay Fund
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Effective Date
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Product Changes
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All Cap Growth
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6/29
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Epoch appointed subadvisor.*
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10/16
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Proposal to approve Epoch as subadvisor.* The Fund will change its name to MainStay Epoch U.S. All Cap Fund.
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Capital Appreciation
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6/29
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MSI appointed subadvisor.*
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October
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Proposed merger into MainStay Growth Equity Fund.*
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Income Manager & Total Return
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6/29
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Epoch appointed subadvisor of the equity portion of Total Return; Dan Roberts and Michael Kimble of MacKay Shields appointed additional portfolio managers responsible for the overall asset allocation decisions for the Portfolio, as well as portfolio management of fixed income investments.
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October
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Proposed merger of Income Manager into Total Return,* which will be renamed MainStay Income Builder Fund.
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Mid Cap Core
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October
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Proposed merger into MainStay MAP Fund.*
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Mid Cap Growth
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6/29
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Tony Elavia appointed manager, as an officer of New York Life Investments. The Fund will continue to be managed in midcap growth style until merger.
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October
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Proposed merger into MainStay Large Cap Growth Fund.*
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Mid Cap Value
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6/29
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Tony Elavia appointed manager, as an officer of New York Life Investments. The Fund will continue to be managed in midcap value style until merger.
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October
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Proposed merger into MainStay ICAP Select Equity Fund.*
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Small Cap Growth & Small Company Value
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6/29
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Epoch appointed subadvisor on Small Company Value* and Small Cap Growth Funds.
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October
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Proposed merger of Small Cap Growth into Small Company Value Fund,* which will be renamed MainStay U.S. Small Cap Fund.
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Tax Free Bond
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7/1
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John Loffredo and Robert DiMella appointed portfolio managers, as officers of New York Life Investments.
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October
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Proposed to approve MacKay Shields as subadvisor.*
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Value
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6/29
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ICAP appointed subadvisor.
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October
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Proposed merger into MainStay ICAP Select Equity Fund.*
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* Pending shareholder approval.
Please do not hesitate to contact us at 866-932-5477, Option 1, with any questions or concerns. As always, we thank you for your continued support of MainStay.
