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Artisan announced that it is merging
Artisan Small
Cap Value
ARTVX
into
Artisan Mid Cap Value
ARTQX
.
The fund has lost
$600
million in outflows during
the past year and is now down to just
$367
million, so
Artisan decided to fold up the tent and merge into
another fund that is getting slammed with outflows.
We give Artisan Mid Cap Value a Morningstar
Analyst Rating of Silver, so you’ll be getting good man-
agement. On the downside, you won’t be getting
small-cap exposure anymore and you may need to add
a new small-cap fund.
Buffett Has Faith in U.S. Economy
Berkshire Hathaway
BRK
.B chairman and
CEO
Warren
Buffett delivered a dose of optimism about America
in his annual letter to shareholders. The highly antici-
pated missive has long been required reading
for Berkshire shareholders and value investors across
the globe.
Buffett laments the “negative drumbeat” of our
presidential election year, which in his view is propa-
gating the story line that, given our country’s
current trajectory, American children will not live as
well as their parents.
“That view is dead wrong,” Buffett counters. “The
babies being born in America today are the luckiest
crop in history.”
Backing up his sunny assessment, Buffett offers a
per-capita view of economic growth, accounts
for productivity, and factors in quality-of-life improve-
ments enabled by technology and innovation.
Considering America’s growth per capita paints a
different picture, in Buffett’s view. “American
GDP
per
capita is now about
$56
,
000
.... [T]hat—in real
terms—is a staggering six times the amount in
1930
,
the year I was born, a leap far beyond the wildest
dreams of my parents or their contemporaries.
U.S.
citizens are not intrinsically more intelligent today,
Fund Manager Changes
Fund News
American Century Growth TWCGX
Impact: Neutral
Date: 01/31/2016
Comanager Prescott LeGard was replaced by Justin Brown. Brown joined Greg Woodhams, who has been a
manager on the fund since 1997. Brown has been a comanager on American Century Fundamental Equity
AFDAX since June 2008. The large-blend fund has lagged its benchmark modestly from his start date through
January 2016.
Our Take:
This fund has lagged modestly just like American Century Fundamental Equity,
so the change doesn’t appear to be a big upgrade or downgrade.
Janus High-Yield JAHYX and Janus Flexible Bond JAFIX
Impact: Negative Date: 03/31/2016
Gibson Smith is leaving Janus. Comanager Darrell Waters will take over as lead manager.
Our Take:
We have
downgraded the funds to
ˇ
as this is a big blow to two formerly appealing funds. Smith built up Janus’
bond effort over the past 12 years and was vital to the team.
Thornburg International Value
Impact: Negative Date: 12/31/2016
Wendy Trevisani gave up her comanager duties on the fund in April 2014 and left the firm in early 2015. Bill
Fries will give up his comanager position on this fund at the end of 2016. Lei Wang is staying put, and he
now has 10 years of experience as a comanager here as well as two decades of investment experience overall.
Di Zhou, who became a comanager on this fund on Dec. 8, 2015, has spent 13 years in the investment field,
including 14 months as an associate manager here.
Our Take:
Two thirds of the three-person team that owns
this fund’s long-term record will be gone at the end of 2016, so we have lowered our Morningstar Analyst
Rating to Neutral.
Touchstone Sands Capital Select Growth PTSGX
Impact: Neutral
Date: 01/30/2016
Thomas Ricketts is retiring, and he was replaced by Wesley Johnston. Johnston has been with Sands Capital
since 2004. This is Johnston’s first time as a listed manager.
Our Take:
Lead manager Frank Sands Jr. is
still in place as are the firm’s seasoned team of 16 analysts, so we are maintaining our Morningstar Analyst
Rating of
´
.
T. Rowe Price Health Sciences PRHSX
Impact: Negative Date: 07/01/2016
Manager Taymour Tamaddon is moving to run T. Rowe Price Institutional Large Cap Growth TRLGX. Ziad Bakri
will take his place on July 1, 2016. Bakri has been a healthcare analyst with the firm since 2011. He is
an M.D. and had previously worked as a biotech analyst for Cowen and Co.
Our Take:
This is a challenge for
T. Rowe because it follows the loss of a manager and two healthcare analysts in 2014. The firm says it
plans to hire additional analysts. This is Bakri’s first time serving as a portfolio manager.
T. Rowe Price New America Growth PRWAX
Impact: Negative Date: 04/01/2016
Dan Martino will be stepping down as portfolio manager in order to join T. Rowe’s value team. Justin White will
take over T. Rowe Price New America Growth. White has been an analyst at T. Rowe Price since 2008, covering
cable and satellite television, Internet infrastructure, and telecom.
Our Take:
It’s a surprising move, as Martino
had been managing the fund only since May 2013. You don’t often see managers go from the growth side to the
value side. We have lowered our rating to
ˇ
.
Vanguard Energy VGENX
Impact: Negative Date: 06/01/2016
Lead manager Karl Bandtel of Wellington Management will retire. Vanguard named Greg LeBlanc, also of
Wellington, comanager of the fund and said he will become the lead manager when Bandtel retires.
Our Take:
Bandtel has a strong track record, so he will be missed. We downgraded the fund to
ˇ
.
Vanguard Strategic Equity VSEQX
Impact: Neutral
Date: 01/28/2016
James Troyer has stepped down as manager. Binbin Guo was promoted to comanager, and he will run the fund
along with Michael Roach and James Stetler, who were named comanagers in 2012. Troyer will remain on
the team, however. This is Guo’s first time as a named manager, but he has been with Vanguard since 2007 and
has headed the equity research and portfolio strategy team at Vanguard’s Quantitative Equity Group since 2010.
Our Take:
Troyer is still on the team, so this doesn’t alter our view of the fund.