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It was a wild and rather rough year for investing. But
some funds fared quite well. Let’s take a look at the
Morningstar Medalists that had returns in the top two
percentiles of their respective categories for
2015
.
Our Morningstar Analyst Ratings are geared toward
the long term, but they certainly do not preclude
medalists from having an outstanding year every now
and then, and when they do, it’s worth understand-
ing why. All told, nine medalists in the Morningstar
500
had returns that landed in the top
2%
of their peers.
Five medalists had bottom
2%
performance, and you
can see my take on them on mfi.morningstar.com.
Brown Capital Management Small Company
BCSIX
returned
8
.
8%
to finish in the top percentile of
small-growth funds. The Gold fund reeled off some
huge gainers in healthcare and technology.
Cantel
Medical
CMN
,
Tyler Technologies
TYL
, and
Manhattan
Associates
MANH
gained more than
40%
in
2015
.
Fidelity Overseas
FOSFX
returned
8
.
3%
for a top-per-
centile finish in the foreign large-blend Morningstar
Category. We upgraded the fund to Bronze in January
2015
because we had been impressed by Vincent
Montemaggiore’s Buffett-esque approach to value.
Over four years at the fund he has nearly tripled
the returns of the
MSCI ACWI
ex
USA
Index, thanks to
an array of steady names with Morningstar Eco-
nomic Moat Ratings of wide, such as
Anheuser-Busch
Inbev
ABI
and
Sanofi
SAN
. That kind of outperform-
ance won’t last, but the fund’s
$5
billion asset base
gives Montemaggiore room to grow.
Gold-rated
T. Rowe Price Capital Appreciation
PRWCX
probably can’t keep up its amazing run, but
you’ve got to hand it to David Giroux. In
2015
,
the fund gained
5
.
4%
to finish in the top percentile
of its category. He hit on a wide array of winners,
including
Fiserv
FISV
and
AutoZone
AZO
, in
2015
.
Vanguard Intermediate-Term Investment-Grade
VFICX
returned
1
.
5%
—tops in the corporate-bond cat-
egory. The Silver-rated fund consistently takes on
less credit and interest-rate risk than its peers, and
that was a good thing in
2015
.
Gold-rated
Vanguard Wellesley Income
VWINX
was the rare conservative-allocation fund to stay in
positive territory thanks to its cautious credit posi-
tioning. Many funds in the category have high-yield
debt in order to boost their payout, but this fund’s
rock-bottom fees allow for a competitive yield while
steering clear of junk.
Morgan Stanley Institutional Growth
MSEGX
posted a robust
11
.
5%
return to finish in the top
3%
in
2015
. Growth managers have summarized
2015
as being all about
FANG
s, and this Gold-rated fund
had all four stocks in that acronym:
FB
,
Amazon.com
AMZN
,
Netflix
NFLX
, and
GOOG
(now
Alphabet
). Of course, any fund with all four
is quite aggressive.
Silver-rated
Conestoga Small Cap
CCASX
returned
8%
to land in the top
2%
following a dreadful
2014
in
which it finished in the bottom
4%
of its category.
That’s a reminder of the value of sticking with a good
fund that’s had a bad year. The fund has
40%
of
assets in tech stocks, and it had a wide array of win-
ners in that sector.
Bronze-rated
Clipper
CFIMX
is another fund on the
rebound, though it is rebounding from a much longer
slump. The fund gained
6
.
4%
to land in the top
1%
of the large-blend peer group. Insurer
Markel
MKL
and Amazon led the way for this fund. This is another
win for those influenced by Warren Buffett.
Fidelity Small Cap Stock
FSLCX
just posted its sec-
ond strong year following four bad years. Man-
ager Lionel Harris emphasizes high-quality measures
such as robust margins, stable businesses, and
minimal debt. That has helped the Bronze-rated fund
to play defense of late, though it did have one
huge winner in
Coca-Cola Bottling
COKE
, which
doubled in
2015
.
K
Top-Performing Medalists of 2015
Tracking Morningstar Analyst Ratings
|
Russel Kinnel
What Are Morningstar
Analyst Ratings?
Our ratings are chosen for long-
term success. Analysts assess
a fund’s competitive advantages
by analyzing people, process,
parent, performance, and price.
They do rigorous analysis and
then submit their ratings to a
committee that vets their work
for thoroughness and consistency.