14
Tweedy Closes Fund to New Investors
Tweedy, Browne Global Value II
TBCUX
announced it would close to new investors as of Aug.
11
. Tweedy, Browne said the closing is because
“undervalued securities are currently very difficult to
come by.” Tweedy, Browne’s other funds remain
open because they have received smaller inflows on
a percentage basis. At Tweedy, Browne Global Value
II
, cash had reached
25%
.
The fund with the next-highest cash level is
Tweedy,
Browne Global Value
TBGVX
, which has a cash
stake of
20%
of assets. It might not be too far from
closing, either.
I like seeing a fund close because of a lack of oppor-
tunities, but I’d hesitate to conclude this means
the market is at a top. The firm last closed Tweedy,
Browne Global Value
TBGVX
in
2005
, a couple
of years before the top.
American Funds Files ETF Plans
American Funds has filed plans to launch an actively
managed exchange-traded fund. The fund would be
“nontransparent,” meaning it won’t publish daily port-
folios that would enable outsiders to recreate the
portfolio for arbitrage purposes. That mechanism is
crucial to keeping
ETF
s trading near their net
asset values.
However, American and other active managers don’t
want to disclose daily portfolios for fear of front-
running. So they’re submitting these nontransparent
ETF
s to regulators with a complicated way to work
around the issue.
New Rules for Money Market Funds
The
SEC
issued new rules for money market funds in
July. John Rekenthaler shared his take:
Fund Manager Changes
Fund News
American Funds EuroPacific Growth AEPGX
Impact:
Negative
Date:
05-30-14
Rob Lovelace has stepped down from this fund, though he will continue on his other two funds. His replace-
ment is Lawrence Kymisis, who has 19 years of investment experience and has been a comanager of American
Funds SMALLCAP World SMCWX since 2007.
|
Our Take: It’s a blow to lose one of the most-seasoned and
best-known managers at the fund. However, with 10 listed managers plus a sleeve run directly by analysts, it’s
likely that Lovelace was running less than 10% of the portfolio. Many seasoned hands remain at the fund.
Appleseed APPLX
Impact:
Negative
Date:
06-30-14
Ronald Strauss and Rick Singer retired at the end of June.
|
Our Take: We are maintaining our Bronze rating
because three comanagers remain who have been leading the way. Bill Pekin, Adam Strauss, and Josh
Strauss are the managers we’ve spoken to over recent years, and we feel comfortable with them in the lead.
Calamos Market Neutral Income CVSIX
Impact:
Negative
Date:
06-26-14
Lead manager Christopher Hartman has left. Eli Pars was added to the management team in his place.
|
Our
Take: We have lowered this fund’s rating to Neutral from Bronze.
FPA Perennial FPPFX
Impact:
Negative
Date:
06-03-14
Steven Geist is retiring from FPA. Comanagers Eric Ende and Greg Herr are dividing his duties.
|
Our Take:
Herr was named comanager in August 2013, so he’s quite new, but Ende has been on board since 1999.
That reassures us that the fund is still in good hands. We have lowered our rating to Silver from Gold to
reflect both the loss of Geist and our confidence in Ende and Herr.
T. Rowe Price Equity Income PRFDX
Impact:
Negative
Date:
10-31-15
Brian Rogers will step down in October 2015 and be replaced by John Linehan, who ran T. Rowe Price Value
TRVLX from 2003 to 2009. From 2009 to now, he’s served as head of T. Rowe’s U.S. equity team.
|
Our
Take: Linehan has a decent record, but it’s not the equal of Rogers, so we have lowered the fund’s rating to
Bronze from Gold.
Third Avenue International Value TAVIX
Impact:
Negative
Date:
06-30-14
Amit Wadhwaney left. Matthew Fine, who has comanaged the fund since 2012 and had been an analyst on
the fund since 2003, took over as the lead manager. Wadhwaney’s exit comes in the wake of other departures
from the international team. In April 2013, Jakub Rehor, who had been a long-tenured analyst and named to
the fund’s portfolio-management team in January 2013, left the firm. Two other analysts also left that month,
though Third Avenue has since brought them back as consultants.
|
Our Take: Wadhwaney and the analysts’
departures are a big blow, and we’ve downgraded the fund to Neutral.
Third Avenue Value TAVFX
Impact:
Negative
Date:
06-10-14
Robert Rewey III has replaced Ian Lapey. Rewey comes to Third Avenue from Cramer Rosenthal McGlynn. He
was one of several comanagers, so he doesn’t have much of a track record.
|
Our Take: We have lowered the
fund’s rating to Neutral from Bronze because of Rewey’s record and because there seems to be a steady
exodus from the firm.
Fidelity Export FEXPX
Impact:
Neutral
Date:
07-01-14
Gordon Scott replaced manager Heather Carrillo. Carrillo had run the fund pretty tightly with the S&P 500 Index
and hadn’t impressed in performance.
|
Our Take: We had rated the fund Neutral last year because of Carrillo’s
unimpressive track record. Since March 2011, Scott has been one of a team of comanagers on Fidelity Advisor
Stock Selector Mid Cap FMCAX. Because of the multimanager format, there’s not much to go by for Scott.
