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American Century to Merge Vista Fund Into Heritage Fund

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American Century announced that it will close the long-struggling  American Century Vista Fund (TWVAX), merging the mid-cap growth strategy's assets into another mid-cap growth fund,  American Century Heritage (ATHAX). The merger will take place Dec. 6, 2013. In the case of the NT (no tobacco) shares of the fund, which are used in the firm's One Choice target-date funds, the switch will take place sooner, on Oct. 11.

A $1.5 billion fund, Vista has experienced both underperformance and manager turnover since 2008. And since previous lead manager Glenn Fogle left the firm in 2009, the new management team has not been able to right the ship. The fund's trailing five-year returns through Sept. 25, 2013, rank in the mid-cap growth category's bottom decile. Vista currently receives a Morningstar Analyst Rating of Neutral. It is fortunate for the fund's investors that American Century has a comparable strategy in Bronze-rated Heritage, which has $4.4 billion in assets. Lead manager David Hollond has been running the strategy since 2007.

Morningstar Fund Analysts does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.