Home>Video>Manager Changes Boost These Funds' Ratings

Manager Changes Boost These Funds' Ratings

Tue, 8 Apr 2014

Key management moves have ultimately proved positive for these large-growth funds.


Video Transcript

The Morningstar Minute is our quick take on investments, the market, economic indicators, and more. Join us every day for fresh insights from our analyst team.

Dan Culloton: We're going to talk about Laudus U.S. Large Cap Growth and BlackRock Capital Appreciation today. The story begins with Laudus U.S. Large Cap Growth. In 2012, its manager, Lawrence Kemp, left that fund's subadvisor, UBS, for BlackRock. That set off a bunch of manager changes at the Laudus fund and led its [Morningstar Analyst Rating for Funds] to be dropped to Neutral because of the uncertainty there.

Meanwhile, at BlackRock, Lawrence Kemp took over BlackRock Capital Appreciation, which had been a fairly mediocre fund up until that point, and began rebuilding his team. As he rebuilt his team, he tapped a lot of people that he worked with at UBS on the Laudus Large Cap Growth fund. Ultimately, he ended up rebuilding a team of seven people, four of which were very familiar with the process that Kemp used at the Laudus U.S. Large Cap Growth fund. In fact, they could lay claim to that fund's good long-term track record.

Now, almost a year later, Kemp and BlackRock has been rehired to run the Laudus U.S. Large Cap Growth fund as a subadvisor, and his team is in place with experienced people who know his process and who can lay claim to that fund's long-term track record. So we've increased the ratings of the Laudus fund and BlackRock fund from Neutral to Bronze. Ultimately, these funds are best used perhaps as complements to a large-cap position in a portfolio. But I think for a growth-oriented investor, someone who's maybe a little more aggressive, they could serve as a core large-cap holding, as well.

  1. Related Videos
  2. Related Articles
  1. Contrarian Approach to Growth Pays Off

    Morningstar 2012 International- Stock Fund Manager of the Year Rajiv Jain expects continued earnings growth for the less popular growth stories of tobacco and Indian consumer stocks.

  2. McGregor Staying Cautious With Banks

    Although he notes the potential problems of investing in financial-services names, Oakmark's Clyde McGregor sees some mispricing in European banks.

  3. Focus on Long -Term Quality, Not Short-Term Rates

    Despite a fully valued market, stocks are still the best place to be for long -run value creation, and interest rates should have little impact on company fundamentals, says Morningstar's Matt Coffina.

  4. Become a Better Index Investor

    Roundtable Report: Experts dig into the ETF versus index fund debate, active and passive strategies, fixed-income benchmarks, factor investing, and much more.

  5. 3 Long -Term Stock Picks in a Market With Few Opportunities

    StockInvestor editor Matt Coffina recently added to several well-known names that have the potential to provide healthy earnings growth over a long time horizon.

  6. Ready Your Portfolio for Retirement

    Morningstar's Christine Benz demonstrates how to make a bucket portfolio best work for you, touching on allocation, RMDs, other income sources, and more.

blog comments powered by Disqus
Upcoming Events

©2014 Morningstar Advisor. All right reserved.