13
Morningstar FundInvestor
August 2
014
Leaders
Matthews India
MINDX
This fund has posted huge returns and handily out-
gained all the other offerings in the small-cap
India-equity Morningstar Category; stocks in its target
market have rebounded sharply in
2014
because
of positive political and other developments. The fund
has benefited from Sunil Asnani and Shratt Shroff’s
picks, including the industrial parts maker
AIA
Engi-
neering, Kotak Mahindra Bank, and Internet content
provider Info Edge. This year is no fluke: The man-
agers’ emphasis on strong and sustainable growers
has paid off in a mix of markets in the past, and
this fund boasts superior long-term returns as well.
Manning & Napier Equity
EXEYX
This large-growth fund has been rewarded for its
distinctions this year. Its management team readily
builds sizable sector overweightings and makes
fuller use of the market-cap and style spectrums than
most peers. Thanks to its hefty stake in the strong
energy sector and many of its large- and mid-cap
value and blend holdings, as well as several of its
large-growth stocks, it has outpaced the vast majority
of its category rivals in
2014
. Although the team’s
penchant for sector bets and overall flexibility has
backfired at times, the fund boasts strong long-
term returns.
Artisan Value
ARTLX
After disappointing in the rallies of
2012
and
2013
,
this large-value fund has fared very well in this
year’s favorable conditions. This year’s gains have
been fueled by its four-person management team’s
tech and energy picks, including top-five holdings
Apple
AAPL
and
Baker Hughes
BHI
. The fund,
which opened in
2006
, also posted mixed results in
its early years but has outpaced its average peer
since inception. The team has earned good long-term
results at mid- and small-value funds using the
same sound strategy it uses here, and while one
member of the team will retire in late
2016
, the
other three members inspire confidence.
Laggards
Thornburg International Value
TGVAX
This foreign large-growth fund is trailing well behind
its typical peer this year. It has also lagged its average
rival in
2013
,
2012
, and
2011
. That’s disappointing,
and Bill Fries and Lie Wang’s stock selection and will-
ingness to load up on individual sectors and coun-
tries are partly to blame for this slump. But the fund
has also faced stylistic headwinds in recent years as
it has evolved from an all-cap offering to a giant-cap
vehicle because of its growing asset base, and giant
caps have lagged smaller caps in the past few years.
Oppenheimer Global Opportunities
OPGIX
This world-stock fund has really struggled this year,
held back by its growth bias, its relatively hefty
stake in the anemic consumer cyclical sector, and
some individual picks in other sectors, including
the biopharmaceutical company
Nektar Therapeu-
tics
NKTR
(which is a
7%
position). But manager
Frank Jennings has always pursued companies with
strong three- to five-year growth prospects, and
he has regularly built oversized stakes in individual
sectors and names that meet his growth and other
standards. While his fairly bold style has backfired
during the first seven months of
2014
, it has paid
off nicely over the long run.
Mairs & Power Growth
MPGFX
This large-blend fund, which stands out for its
emphasis on Midwest-based firms and low turnover,
is mired in its category’s worst decile this year.
It has been hampered by some industrial holdings,
including Minnesota-based
Toro
TTC
(which has
been a holding since
1993
) and Missouri-based
Emerson Electric
EMR
(a holding since
1998
). But
management’s focus on strong growers located
near Mairs
&
Power’s home in Minnesota has worked
well for decades, and the fund boasts great long-
term returns. Although one of its two managers will
retire soon, the other is long-tenured and has a
strong support team.
œ
Ten Worst-Performing Funds
Fund Name
YTD Cat Rank %
CGM Focus
100
CGM Realty
100
Vanguard Precious Metals 100
Ariel Discovery Investor
99
Greenspring
99
Oppenheimer Global Opport 99
Berwyn
98
Conestoga Small Cap Inves 98
Mairs & Power Growth Inv 98
Baron Opportunity Retail
97
Ten Best-Performing Funds
Fund Name
YTD Cat Rank %
ClearBridge Aggressive Gr
1
Fairholme Focused Income 1
Fidelity Select Health Ca
1
Matthews India Investor
1
Meridian Small Cap Growth 1
Oakmark Select I
1
Vanguard PRIMECAP Inv
1
Domini Social Equity Inv
2
Fidelity New Markets Inco 2
Janus Contrarian T
2
Matthews India Leads Category Again
Leaders & Laggards
|
William Rocco
