14
Matthews Fund to Close
Matthews is closing
Matthews Asia Dividend
MAPIX
to new investors on June
14
. We gave the
$
5
.
5
billion fund a Morningstar Analyst Rating of
Gold. The fund has top-decile returns for the trailing
three- and five-year periods.
The Silver-rated
Matthews Asian Growth &
Income
MACSX
is probably the best substitute if you
missed the deadline. Matthews Asian Growth &
Income also looks for dividend-paying stocks, but it
has a slug of convertible bonds and preferreds, too.
In addition, it has a much smaller China stake than
Matthews Asia Dividend does.
Vanguard Cuts Fees at Some Funds
Vanguard announced that investors in one of the
firm’s exchange-traded funds and five of its mutual
fund share classes will benefit from lower fees,
effective immediately.
Vanguard Dividend Appreciation Index
VDAIX
,
Gold-rated
Vanguard Dividend Growth
VDIGX
,
Gold-rated
Vanguard Energy Admiral
share class
VGELX
and
Investor
share class
VGENX
, and Gold-
rated
Vanguard Precious Metals and Mining
VGPMX
all saw expenses fall between
2
and
5
basis
points each. Vanguard Dividend Appreciation Index’s
fee fell to
0
.
20%
from
0
.
25%
, while Vanguard Divi-
dend Growth’s expense ratio slid to
0
.
29%
from
0
.
31%
. Vanguard Energy Admiral share class’ fee
dropped to
0
.
26%
from
0
.
28%
, while Vanguard
Energy Investor share class’ expense ratio fell to
0
.
31%
from
0
.
34%
. Vanguard Precious Metals and Mining’s
fee dropped to
0
.
26%
from
0
.
29%
. Also, the ex-
pense ratio of
Vanguard Dividend Appreciation
ETF
VIG
fell to
0
.
10%
from
0
.
13%
.
Berkowitz Benefits
May
6
was a big day for Fairholme and Bruce
Berkowitz.
MBIA
reached an agreement with Bank of
America for B of A to pay it $
1
.
7
billion. Berkowitz
Fund Manager Changes
Fund News
Harbor International Growth HIIGX
Impact: Neutral 05-21-13
Harbor has replaced manager James Gendelman and Marsico Capital with Gerard Callahan, Iain Campbell,
Joseph Faraday, and Paul Faulkner of Baillie Gifford, a firm that subadvises portions of two Vanguard
funds.
|
Our Take: Harbor rarely makes subadvisor changes, but it’s understandable as performance has
long lagged and Marsico has seen some managers and analysts leave. We don’t see Baillie Gifford
as a big upgrade, but it does at least seem to be more stable. We are dropping the fund from coverage.
Janus Fund JANSX
Impact: Negative 05-13-13
Jonathan Coleman has been moved off this fund to run Janus Triton JATTX and Janus Venture JAVTX.
Comanager Barney Wilson now becomes the sole manager after two years as a comanager. Wilson did
have a strong five-year track record at Janus Global Technology JAGTX.
|
Our Take: We are maintaining
our Neutral rating on the fund. Wilson is running his first diversified fund, so we can’t really make the
case for this fund at this point.
Janus Triton JATTX and Janus Venture JAVTX
Impact: Negative 05-13-13
Brian Schaub and Chad Meade, who produced great returns at both funds, have left the building. They
have been replaced at Triton by Jonathan Coleman, who had run the Neutral-rated Janus Fund JANSX, and
at Venture by Coleman and Maneesh Modi (who is running a fund for the first time). Coleman ran mid-
growth fund Janus Enterprise JAENX from 2002–07 and did well (though his record wasn’t as impressive
as Meade and Schaub’s). He also comanaged Janus Venture once before from 1997 to the end of 2000,
and like other Janus funds it did well in the frothy markets and gave it back in the downturn.
|
Our Take:
This sucks. It’s a huge blow to lose managers doing so well. We lowered the funds to Neutral from Silver.
Janus Twenty JAVLX
Impact: Positive 05-13-13
Manager Ron Sachs has left, and Janus moved Mark Pinto onto the fund. Pinto runs the Neutral-rated
Janus Growth & Income JAGIX and the Silver-rated Janus Balanced JABAX.
|
Our Take: We had rated the
fund Neutral because of an unimpressive run for Sachs, and we are maintaining our Neutral rating with
Pinto at the helm. Pinto figures to run a more growth-oriented strategy than at his other charges. Growth
& Income has been a mediocre performer, but he’s performed well at a separate account using a concen-
trated large-growth approach.
T. Rowe Price Media & Telecommunications PRMTX
Impact: Negative 10-01-13
Dan Martino will transition off this fund at the end of September. Analyst Paul Greene has been promoted
to comanager until he takes over on Oct. 1.
|
Our Take: We hate to see Martino go but recognize that the
fund has weathered past departures well thanks to the depth of the analyst team. Greene has been an
analyst at T. Rowe since 2006. We’ve lowered our rating to Bronze from Silver. While we think the fund
is likely to continue to outperform, it is not a destination but a stepping stone for new portfolio managers
toward a diversified growth fund.
T. Rowe Price New America Growth PRWAX
Impact: Negative 05-10-13
Joe Milano has unexpectedly left T. Rowe Price, and it has promoted Dan Martino from T. Rowe Price Media
& Telecommunications PRMTX to take his place.
|
Our Take: What a blow. We’ve lowered the rating to
Neutral from Gold. You don’t often see surprise changes at T. Rowe; normally a new manager has a transi-
tion period. What’s more, while past Media & Telecom managers have moved on to diversified funds,
results have been mixed. The good news is that Martino did a fine job at his previous fund, so there may
yet be hope for this one.
