360 / 708
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Two very different funds are joining the Morningstar
500
.
Loomis Sayles Global Equity and Income
LGMAX
is a wide-ranging fund in the world-allocation
Morningstar Category. The bond side is run by Dan
Fuss and David Rolley, while Eileen Riley and
Lee Rosenbaum run the stock side. The four deter-
mine the allocation mix based on where they are
finding attractive investments. The fund has consis-
tently held more in stocks than bonds, and it
currently has a
70
/
30
mix. Compared with most world-
allocation funds, this fund has a clear lean toward
high-yield and growth stocks. That’s been nicely in
sync with the market lately, leading to solid returns.
The fund is available in No Transaction Fee super-
markets despite the official front load. See facing page
for more details.
I’m also adding large-growth category fund
Parnassus
PARNX
. The
4
-star fund has a nice low expense ratio
of
0
.
84%
. That’s not bad for a fund under
$1
billion.
The fund follows environmental, social, and gover-
nance principles by screening out less ethical compa-
nies and leaning in favor of those that are ethical.
Lead manager Jerome Dodson is assisted by relatively
new additions Ian Sexsmith and Robert Klaber. The
fund skews toward the smaller, more-value end of
large growth because it is more value-conscious.
The managers like growth, but they emphasize buying
names at significant discounts to their intrinsic
value estimate. They often add to positions when a
stock is falling and trim when it approaches their
estimate of intrinsic value. The fund’s
ESG
criteria give
it a clear skew toward technology and away from
energy and utilities.
To make room, I’m taking out
Kalmar Growth-with-
Value Small Cap
KGSCX
. Although it has some appeal,
its asset base is shrinking rapidly, as I detailed in
the cover story. The fund will need to improve to turn
around that trend and continue in business.
I’m also dropping
Oppenheimer Global Opportunities
OPGIX
. We give the fund a Morningstar Analyst
Rating of Neutral because it’s the definition of key-man
risk. Although manager Frank Jennings is in his
late
60
s, he has no analyst support and no clear suc-
cessor on the fund. He’s a fine manager, but it’s
tough to make the case for the fund at this point.
K
What is Morningstar
FundInvestor
500
?
The Morningstar FundInvestor
500
features the industry’s
best and most notable funds.
Use the list to get new in-
vestment ideas and track the
funds you already own.
FundInvestor
subscribers have
access to one-page monthly
reports on all 500 funds on
mfi.morningstar.com. Just
type in the name or ticker of
the fund in the search box.
Funds From Loomis Sayles and
Parnassus Join the 500
Changes to the 500
|
Russel Kinnel
Summary of Changes
Add
Drop
Loomis Sayles Global Equity & Inc Kalmar Grwth-with-Value Sm Cap
Parnassus
Oppenheimer Global Opportunities
Downgrades
From
To
MFS Global Equity
Œ •
Metropolitan West High Yield Bond
´ ‰
Rating Change
DoubleLine Total Return Bond
Not Ratable
‰
New Rating
Loomis Sayles Global Equity and Income
´
Matthews India Investor
´
Parnassus
´