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I am dropping
Aston/Tamro Small Cap
ATASX
and
Columbia Acorn International Select
LAFAX
.
In their place, I’m adding
Seafarer Overseas Growth
and Income
SFGIX
and
MFS Growth
MFEGX
.
Aston/Tamro Small Cap is going to be merged into
another fund because subadvisor Tamro is folding up
its tent. Tamro has been hit with redemptions in
mutual funds and other accounts to the point where
it is shutting down the firm. The fund itself has
shrunk to
$150
million from
$800
million in the course
of a year because of a performance slump. As a
result, the fund will merge with
AMG GW&K Small
Cap Growth
GWGIX
in a few months, but
GW&
K
Investment Management started running the fund
as of Feb.
1
.
The complete shutdown of the fund is pretty remark-
able, but it shows how active managers are more
vulnerable than ever to a performance slump. It has
a Morningstar Analyst Rating of Neutral.
In its place, I’m adding the steady
MFS
Growth.
It is a
$12
billion large-growth fund run by Eric
Fischman. Fischman has been on board since
2002
,
and he’s produced solid returns. In particular,
I am impressed by how the fund has outperformed
in most up markets and down markets. Fischman
seeks companies with strong pricing power and the
ability to grow over the long haul. That means
names like
Visa
V,
Amazon.com
AMZN
, and
Master-
Card
MA
. Fischman invests more than
$1
million
of his own money in the fund. This is a broker-sold
fund. See the facing page for more.
I’m dropping coverage of Columbia Acorn Interna-
tional Select, which has also been shrunk by
redemptions, though in less-dramatic fashion. The
Neutral-rated fund had
$110
million in outflows
in
2015
, which shrunk it down to
$140
million in total.
Comanager Chris Olson stepped down in January
2016
, and Stephen Kusmierczak was elevated to
a comanager. Andreas Waldburg-Wolfegg remains
as comanager, though he has only been on board
since May
2015
. Thus, with new management and
redemptions, the fund has limited appeal.
I’m adding Seafarer Overseas Growth and Income to
take its place. It is an emerging-markets fund run by
Andrew Foster, who did an excellent job at
Matthews
Asia Dividend
MAPIX
and
Matthews Asian Growth
and Income
MACSX
. Interestingly, though, this fund
invests in all emerging markets rather than focusing
on Asia like his previous charges. The fund has
58%
in
Asia,
23%
in Latin America,
14%
in emerging Europe,
and
5%
in South Africa. He actually has a bit less in
Asia than most emerging-markets managers.
Foster has more than
$1
million invested in the fund.
We will be assigning a Morningstar Analyst Rating to
the fund soon, but it does have a
5
-star Morningstar
Rating. Launched in February
2012
, it is running well
ahead of its peers. The fund charges
1
.
30%
, and
it looks like that will be coming down as assets have
grown to
$760
million. The fund is available in most
No Transaction Fee supermarkets.
K
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Andrew Foster Returns to the
Morningstar 500
Changes to the 500
|
Russel Kinnel
Summary of Changes
Add
Drop
MFS Growth
ASTON/TAMRO Small Cap
Seafarer Overseas Growth and Income Columbia Acorn Intl Select
Rating Change (Downgrades)
From
To
Janus Balanced
• ‰
Janus Flexible Bond
• ‰
Janus High-Yield
´ ‰
New
Ratings
To
Vanguard US Value
´