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Little-Known Funds From Well-Known Managers

Their other funds have billions, but their newer portfolios have far less.

Gregg Wolper, 03/01/2011

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Creating a mutual fund is no guarantee of riches. It can be very tough to attract substantial levels of assets. The few new funds that have succeeded in attracting heavy inflows in recent years often have come from portfolio managers with names well-known to advisors. Typically they already run other funds with asset levels in the billions of dollars or have done so in the recent past.

One noteworthy recent success story is DoubleLine Total Return Bond DLTNX, managed by Jeffrey Gundlach and his team (formerly of TCW), which has gathered $4.5 billion in less than a year. Another is IVA Worldwide IVWAX, run by Charles de Vaulx and Chuck de Lardemelle, who established themselves at First Eagle. IVA Worldwide, launched in late 2008, had raked in well over $1 billion by mid-2009. It closed to new investors a week and a half ago with about $9 billion in its coffers.

As it turns out, though, at times even managers who run billions of dollars can't attract much money to new offerings. But some such funds are certainly worth a look.

Why have these funds struggled to gain attention in spite of an impressive pedigree? For the three offerings discussed below, one answer could be their category. Global-stock funds (also known as world-stock) face a headwind: the apparent preference of many U.S. investors to own separate offerings for domestic and international equities rather than one that buys stocks all over the globe. Still, some world-stock funds are huge, so clearly there's an audience willing to consider them.

Even investors who already own separate domestic and international could benefit from checking out these lesser-known choices. Given these managers' distinctive approaches, adding one of these funds may not lead to much overlap with existing holdings as long as you don't own one of the managers' other charges.

Artisan Global Value ARTGX
Managers David Samra and Daniel O'Keefe have put together an impressive record at the all-foreign Artisan International Value ARTKX. They won recognition as Morningstar International-Stock Manager of the Year for 2008 for their success at that fund. Artisan Global Value, which also owns U.S. stocks, came out at the end of December 2007. It's possible that the lack of a three-year record might have inhibited investors, for many people--especially advisors--like to see a fund pass that benchmark before buying. Now this fund has passed that measure. Its three-year return places in the top decile of the world-stock category.PAGEBREAK

It's true that Samra and O'Keefe have not previously run a fund with U.S. stocks, but they've looked closely at scores of American companies for years while comparing foreign companies to their competitors. The fund's all-cap nature partly explains why its return trounces those of most world-stock rivals, the bulk of which focus more on large caps (which lagged mid- and small caps during most of this period.) All told, though, it's hard to see why this fund should have less than $50 million in assets, while Artisan International Value has $3.3 billion.

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