13
Morningstar FundInvestor
November
2013
Leaders
Vanguard Capital Opportunity
VHCOX
This recently reopened fund’s
35
.
4%
year-to-date
return beats nearly all large-growth peers. The
Primecap management team subadvising this fund
follows a patient, contrarian growth strategy, hold-
ing on to picks for years. A long-running stake in
health-care stocks—particularly pharmaceutical and
biotech firms—paid off as health-care stocks
surged. The fund also benefited from top-
10
holding,
LED
-light and semiconductor manufacturer
Cree
CREE
, which has gained nearly
80%
thus far in
2013
.
Mitch Milias, who is a comanager on some other
Primecap funds, is set to retire at year-end. See
Manager Changes on Page
14
for details.
Dodge & Cox International Stock
DODFX
This foreign large-blend fund’s
22
.
5%
return has out-
paced more than
90%
of category peers this year.
The fund overcame a headwind posed by its outsized
stake in flagging emerging-markets stocks with
strong performance from its technology and health-
care picks. The fund’s top holdings, South Africa-
based Internet firm
Naspers
NPSNY
and health-care
titan
Roche Holding
RHHBY
, were the top contri-
butors to performance in
2013
. The fund’s patience
with
Hewlett-Packard
HPQ
also paid off, as the
embattled tech holding rose more than
70%
this year.
T. Rowe Price High-Yield
PRHYX
This fund’s willingness to take on credit risk, rather
than interest-rate risk, has paid off this year. Carrying
a higher stake in riskier
CCC
rated bonds than it
has in the past—while maintaining relatively low
interest-rate sensitivity—this fund has navigated
2013
’s rising-rate environment well. The fund’s
7
.
8%
return beat more than
85%
of category peers so
far this year.
Laggards
ASTON/Montag & Caldwell Growth
MCGFX
Despite posting double-digit returns so far this year,
this fund trails
95%
of large-growth peers. That’s
not a surprise, as the fund’s emphasis on high quality
at a modest price has worked best in turbulent
markets such as
2008
and
2011
. This year, the fund’s
larger stake in consumer defensive stocks hasn’t
impressed, with top-
10
holdings
Coca-Cola
KO
and
Philip Morris International
PM
gaining just
11
.
5%
and
9
.
8%
, respectively. The fund’s health-care
stock selection has hampered returns as well.
Allergan
AGN
(a pharmaceutical developer and top
holding here) has lost
1
.
1%
, while health-care peers
raced forward this year.
Columbia Acorn International Select
LAFAX
This fund’s
14
.
5%
return this year lags
90%
of foreign
small/mid-growth peers. A heavy weighting in mining
firms weighed on returns, with gold miners such as
Allied Nevada Gold
ANV
and
Goldcorp
GG
taking
double-digit losses this year. The fund also suffered
from a larger stake in the sluggish global real estate
sector. One of the fund’s largest holdings, Singapore-
based
Ascendas Real Estate Investment Trust
ACDSF
, gained a modest
3
.
7%
so far this year.
Vanguard High-Yield Corporate
VWEHX
This fund’s exposure to higher-quality high-yield bonds
has helped it hold up better than peers when riskier
credits sell off. However, a larger exposure to higher-
rated, high-yield bonds and a preference for new
issues makes the fund more interest-rate-sensitive
than category peers. That sensitivity has hurt in this
year’s rising-rate environment: The fund’s
3
.
9%
gain
this year lags more than
90%
of category peers.
œ
Contact Flynn Murphy at
Ten Worst-Performing Funds
Fund Name
YTD Cat Rank %
Appleseed
99
Royce Low Priced Stock Sv 99
Amana Growth Investor
98
First Eagle US Value A 98
Royce Premier Invmt
98
Vanguard Long-Term Invest 98
Virtus Foreign Opportunit
98
FPA Capital
97
Fidelity Export & Multina 97
Meridian Growth Legacy 97
Ten Best-Performing Funds
Fund Name
YTD Cat Rank %
American Funds 2020 Trgt
1
Artisan International Val
1
Berwyn Income
1
Dodge & Cox Balanced
1
Fairholme Focused Income 1
Oakmark International I
1
T. Rowe Price Media & Tel
1
Third Avenue Real Estate 1
Vanguard Capital Value In 1
Vanguard Precious Metals 1
Vanguard Capital Opportunity Is
Rocking
Leaders & Laggards
|
Flynn Murphy
