Jim Moffett logs few miles to invest in foreign companies for his topnotch international fund. MorningstarAdvisor.com
It would be inaccurate to call Jim Moffett old-fashioned. He carries a BlackBerry, reads books on a Kindle, and banters with the hosts on CNBC.
But old-fashioned habits do define Moffett's approach at Scout International
Based in Kansas City, Mo., Moffett has managed Scout International since 1993, after his employer was acquired by United Missouri Bank. UMB was about to launch a mutual fund specializing in foreign stocks. In his words, they looked around for a manager and then said, "Why don't we just let Jim run it?" Moffett wasn't an obvious choice; the bank-trust portfolios he had run focused on domestic stocks. He'd never managed an international fund. But over the years, Moffett--who had a longstanding interest in international affairs--had owned a few foreign companies.
Although one can question the rigor of UMB's search process, the choice proved wise. The fund's 15-year return through the end of November 2009 is one of the best of any broad-based international fund. It has achieved that high return with relatively low volatility. Moffett has twice been named runner-up for Morningstar's International-Stock Manager of the Year award.
Keeping Expectations in Check
It's no surprise that Moffett retains traits from an older time and feels comfortable with a less frenzied pace. He grew up on a farm outside Kansas City and says that experience helped instill patience. It also served to rein in expectations. "Some years, it rains, and it's a good year," he says. But farmers know lean years will come, as well. "So, I never expected stocks to go up in a straight line."
Behind the aw-shucks demeanor lies an inquisitive mind--and a highly educated one. Moffett received a bachelor's degree in history from Harvard, where he wrote his senior thesis on the commercial connections between Britain and Argentina in the early 19th century. He then headed straight to Stanford for an MBA. From there--with an interruption for military duty as a reserve officer, for this was the Vietnam era--he went into investing.
Moffett makes it clear that his career decision owed to interest in the field, not a desire to make the big bucks. "At the time, investment management wasn't as glamorous as it is now," he says. "It wasn't seen as the road to instant wealth, as it is for young people today."
With his Midwestern roots, his passion in investing for investing's sake, and his folksy manner, some might associate Moffett with Warren Buffett. Not so fast. Both use a patient, low-turnover style, but otherwise their approaches have little in common. Most important, Moffett has never been a classic value investor--he has leaned toward growth.