USAA Balanced Strategy Fund drops QS, names USAA as new subadviser

By Toni Weeks

San Diego, Dec. 7 - USAA Balanced Strategy Fund's board of trustees approved the termination of the subadvisery agreement with QS Investors because of QS's long-term performance history, according to a 497 filing with the Securities and Exchange Commission.

The fund's investment adviser, San Antonio-based USAA Investment Management Co., said it has the equity portfolio management expertise to manage U.S. large-cap equity portfolios and will begin managing the U.S. equity portion of the fund on Wednesday.

The fund will now be managed by John P. Toohey, Wasif A. Latif and Julianne Bass of USAA.

Toohey, who will be responsible for the fund's asset allocation, joined USAA in February 2009 and has co-managed the portion of the stocks investment category that invests in exchange-traded funds since July 2009. Prior to that, he was a managing director at AIG Investments from 2000 to 2009.

Latif has worked for USAA since June 2006 and has co-managed the portion of the stocks investment category that invests in ETFs since July 2009.

Bass has 24 years of investment management experience, with 12 of those at USAA.

The filing also said that USAA will tweak the type of stocks it invests in. It will continue to invest in domestic common stocks and other equity securities with all asset classes (small, mid and large cap), but its primary focus will now be on large-cap stocks rather than those within the Russell 3000 index.

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