(PUB) Investing 2016

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23 Morningstar FundInvestor November 2016
Data through October 31, 2016 FINRA members: For internal or institutional use only.
Harbor Small Cap Value Instl Ticker
HASCX
Yield
0.3%
Total Assets
$761 mil
Mstar Category
Small Blend
Benchmark 1: Russell 2000 TR USD
Benchmark 2: S&P 500 TR USD
Morningstar Analyst Rating 10-17-16
´
Morningstar Pillars
Process ∞ Positive
Performance ∞ Positive
People ∞ Positive
Parent ∞ Positive
Price ∞ Positive
Morningstar Analyst Rating
Morningstar evaluates mutual funds based on five key pillars, which its
analysts believe lead to funds that are more likely to outperform over the
long term on a risk-adjusted basis.
Analyst Rating Spectrum
Œ „ ´ ‰ Á
Pillar Spectrum
∞ Positive § Negative ¶ Neutral
10.0
15.0
20.0
Historical Profile
Return
Risk
Rating
Above Avg
Average
QQQQ
Above Avg
6 8 6 6 6 6 6 6 Investment Style
Equity
Growth of $10,000
Investment Values of
Fund
Investment Values of
Benchmark 1
) * * ) ) & ( ( & * & Performance Quartile
(within Category)
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 10-16 History
21.44 19.90 13.26 16.34 19.59 20.00 22.34 25.66 26.70 24.74 27.27 NAV
10.66 -1.44 -32.89 23.78 20.36 2.38 14.16 35.60 7.88 -3.66 10.23 Total Return %
-7.71 0.13 0.89 -3.39 -6.50 6.56 -2.19 -3.22 2.98 0.75 4.06 +/- Bmark 1
-5.14 -6.93 4.10 -2.69 5.29 0.27 -1.84 3.21 -5.81 -5.04 4.36 +/- Bmark 2
0.10 0.44 0.28 0.54 0.46 0.27 1.08 0.22 0.23 0.35 0.00 Income Return %
10.56 -1.88 -33.17 23.24 19.89 2.11 13.08 35.38 7.65 -4.01 10.23 Capital Return %
86 45 27 82 87 6 64 68 10 35 12 Total Rtn % Rank Cat
0.02 0.10 0.05 0.07 0.08 0.05 0.22 0.05 0.06 0.09 0.00 Income $
0.49 1.11 0.04 0.00 0.00 0.00 0.27 4.41 0.91 0.89 0.00 Capital Gains $
0.83 0.83 0.85 0.88 0.88 0.86 0.86 0.84 0.84 0.85 0.86 Expense Ratio %
0.19 0.44 0.40 0.50 0.39 0.31 0.97 0.45 0.33 0.38 0.52 Income Ratio %
27 14 16 18 12 12 14 22 13 19 . Turnover Rate %
1,906 1,381 653 649 611 548 490 535 717 799 739 Net Assets $mil
Performance 10-31-16
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Total
2012 8.80 -5.19 5.28 5.12 14.16
2013 12.00 2.84 8.98 8.04 35.60
2014 1.68 2.38 -4.87 8.94 7.88
2015 4.42 -1.47 -11.21 5.46 -3.66
2016 2.83 3.07 6.52 — —
Trailing Total
Return%
+/- Bmark
1
+/- Bmark
2
%Rank
Cat
Growth of
$10,000
3 Mo -0.15 1.84 1.52 10 9,985
6 Mo 6.90 0.77 2.84 11 10,690
1 Yr 8.18 4.07 3.67 8 10,818
3 Yr Avg 6.30 2.18 -2.54 6 12,012
5 Yr Avg 12.67 1.16 -0.90 21 18,156
10 Yr Avg 6.34 0.38 -0.36 32 18,483
15 Yr Avg — — — — —
Tax Analysis Tax Adj Rtn% %Rank Cat Tax-Cost Rat %Rank Cat
3 Yr (estimated) 4.25 10 1.93 47
5 Yr (estimated) 11.27 17 1.24 45
10 Yr (estimated) 5.52 22 0.77 26
Potential Capital Gain Exposure: 36% of assets
Rating and Risk
Time
Period
Load-Adj
Return %
Morningstar
Rtn vs Cat
Morningstar
Risk vs Cat
Morningstar
Risk-Adj Rating
1 Yr 8.18
3 Yr 6.30 High Avg QQQQQ
5 Yr 12.67 +Avg Avg QQQQ
10 Yr 6.34 Avg Avg QQQ
Incept 9.78
Other Measures Standard Index Best Fit Index
Alpha -3.2 1.4
Beta 1.14 0.99
R-Squared 75 95
Standard Deviation 14.09
Mean 6.30
Sharpe Ratio 0.50
Portfolio Analysis 09-30-16
Total Stocks: 56
Share change since 06-30-16 Sector YTD Ret % % Assets
YGlobal Payments Inc Industrl 12.46 3.41
YSnap-on Inc Industrl -9.04 3.11
YThe Valspar Corp Basic Mat 21.27 3.10
YHexcel Corp Industrl -1.14 2.98
YMonolithic Power Systems Technology 24.64 2.82
YEntegris Inc Technology 19.82 2.71
YEnerSys Technology 17.39 2.48
YFranklin Electric Co Inc Industrl 35.95 2.41
YAdvanced Energy Industrie Technology 68.97 2.39
YCoherent Inc Technology 59.91 2.34
YCentene Corp Hlth Care -5.06 2.33
YRaymond James Financial I Finan Svcs 4.74 2.27
YReinsurance Group of Amer Finan Svcs 27.42 2.27
YMednax Inc Hlth Care -14.53 2.19
YThe Scotts Miracle Gro Co Basic Mat 38.78 2.19
YMueller Water Products, I Industrl 44.19 2.18
YLittelfuse Inc Technology 31.21 2.16
YMolina Healthcare Inc Hlth Care -9.51 2.04
YWGL Holdings Inc Utilities 3.18 2.01
RCatalent Inc Hlth Care — 1.92
Current Investment Style
Large Mid Small
Value Blend Growth Market Cap %
Giant 0.0
Large 0.0
Mid 31.4
Small 59.4
Micro 9.2
Avg $mil:
3,159
Value Measures Rel Category
Price/Earnings 20.12 1.07
Price/Book 2.23 1.19
Price/Sales 1.21 1.16
Price/Cash Flow 7.66 1.05
Dividend Yield % 1.32 0.79
Growth Measures % Rel Category
Long-Term Erngs 10.95 0.93
Book Value 4.08 1.23
Sales 6.62 4.04
Cash Flow 12.30 1.77
Historical Erngs 6.83 1.34
Profitability %
Return on Equity 14.05
Return on Assets 4.80
Net Margin 8.44
Sector
Weightings
% of
Stocks
Rel
Bmark 1
h Cyclical 32.24 0.73
r BasicMat 6.51 1.14
t CnsmrCyc 3.81 0.31
y FinanSvcs 19.55 1.14
u Real Est 2.37 0.26
j Sensitive 52.38 1.47
i CommSrvs 1.94 1.67
o Energy 4.71 1.74
p Industrl 20.20 1.41
a Technlgy 25.53 1.46
k Defensive 15.39 0.77
s CnsmrDef 1.17 0.31
d Hlthcare 10.47 0.86
f Utilities 3.75 0.94
Composition - Net
Cash 2.9
Stocks 97.1
Bonds 0.0
Other 0.0
Foreign 0.0
(% of Stock)
Morningstar's Take by Christopher Franz 10-17-16
Harbor Small Cap Value features a long-tenured manager
and strong research process. It is subadvised by a team
at Atlanta-based Earnest Partners that's run the fund
since its December 2001 inception. The managers have
delivered consistent and attractive risk-adjusted returns
and benefit from a proven team. This fund earns a
Morningstar Analyst Rating of Bronze.
The fund is led by Paul Viera, CEO and founder of
Earnest Partners. Viera founded the firm in 1998,
following stops at Invesco and Bankers Trust. Earnest is
privately held with eight total partners. Viera owns more
than 50% of the firm. He is supported by a deep
investment team that totals 11, including Viera. It makes
investment decisions collaboratively. An 80% majority is
required to take action, although Viera retains the final
say on portfolio construction.
The group uses a proprietary model to narrow their
investment universe. It divides an investable universe of
2,000 stocks into 36 clusters based on shared financial
characteristics or how a given stock responds to different
financial forces. Then the team evaluates current market
trends and macroeconomic conditions, highlighting the
types of stocks or clusters that typically respond well.
This tapers the field to around 150 high-conviction ideas.
The team then dives in for deep, fundamental research.
The resulting portfolio almost always lands in the
small-blend section of the Morningstar Style Box. Viera
typically owns 60 stocks, with around 25% of assets in
the top 10 positions. Viera and his team focus on the long
term,withportfolio turnoveroften less than20%peryear,
well below the small-blend Morningstar Category
average of 63%.
Viera and team have posted strong returns dating
back to the fund’s December 2001 inception. Its
annualized return of 10.0% outpaces the 8.6% and 7.9%
returns of the Russell 2000 Value Index and average peer,
respectively. This top-quintile peer performance is strong
ona risk-adjustedbasisaswell,withanattractiveupside/
downside-capture ratio versus both the fund’s bogy and
average peer.
Address: Harbor Funds Minimum Purchase: $50000 Add: — IRA: $50000
Chicago, IL 60606-4302 Min Auto Inv Plan: — Add: —
800-422-1050 Sales Fees: No-load
Web Address: Management Fee: 0.75%
Inception: 12-14-01 Actual Fees: Mgt:0.75% Dist:—
Advisor: Harbor Capital Advisors Inc Expense Projections: 3Yr:$277 5Yr:$481 10Yr:$1069
Subadvisor: Earnest Partners LLC Income Distribution: Annually
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