Plus, Bill Gross' thoughts on the market and more.
Morningstar's fund analysts cover 2,000 mutual funds. Their full analyst reports, including Stewardship Grades, are available in Morningstar Principia Mutual Funds Advanced and Morningstar Advisor Workstation Office Edition.
Masters' Select has shaken up the manager roster of Masters' Select Equity
Both funds have struggled immensely since the credit crunch first reared its ugly head in mid-2007, and Bill Miller's stock-picking holds part of the blame. At Legg Mason Value, Miller made a slew of wrong bets on mortgage lenders and homebuilders and missed the energy rally, tarnishing his five- and 10-year record. Miller wasn't alone in his suffering, though. Bill Nygren also bet incorrectly on suffering financial and consumer companies at Oakmark Select
Investors of Masters' Select Equity and Masters' Select Value should stay the course, as both offerings are still backed by some of the most talented managers around.
PIMCO Urges More Government Action to Calm the Market
In his latest Investment Outlook, PIMCO's co-CIO Bill Gross argues that cyclical interest-rate cuts, liquidity provisions, and the purchase of subprime-mortgage debt by the Treasury may not be enough to stabilize the market, saying "the Federal Reserve must now act as a clearing house, guaranteeing that institutional transactions [will] clear." Further, he argues that "they must also take another bold step: outright purchases of commercial paper. They should also cut interest rates to 1%, because we are experiencing asset deflation, and the threat of headline inflation is long past." The Fed decided to cut its overnight lending rate from 2.0% to 1.5% yesterday, and other countries' central banks followed suit.
John Hancock's Shareholder-Unfriendly Move
John Hancock is seeking shareholder approval to bring Robeco Boston Partners Large Cap Value
New Fund Joins the Long-Short Fray
Absolute Investment Advisers is launching a long-short offering. Absolute Opportunities seeks to provide higher risk-adjusted returns than traditional equity indexes, such as the S&P 500. The fund will be subadvised by GMB Capital Management, MetWest Asset Management, Green Eagle Capital, Kingstown Capital Management, and Madden Asset Management. The teams will be allowed to invest in domestic and foreign stocks, debt (without limitations on credit quality or maturity), exchange-traded funds, options, futures, and swaps. The fund comes with a 2.95% expense ratio, making it too expensive to recommend.
Fidelity Advisor Mid Cap