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By Susan Dziubinski | 09-19-2012 03:00 PM

Fund Favorites and Follies Over 20 Years

In this special 50-minute panel discussion, Morningstar's Christine Benz, Russ Kinnel, and John Rekenthaler chart fund investing's course over the last two decades, discuss investors' biggest challenges today, and reveal some of their favorite longtime picks.

Susan Dziubinski: Good afternoon, and welcome to Morningstar FundInvestor's 20th Anniversary Celebration Roundtable. I am Susan Dziubinski. I'm the publisher of the Morningstar Investor Newsletters, and I'm also the moderator for this afternoon's event.

Twenty years ago this month, Morningstar published its first issue of Morningstar FundInvestor. The publication's mission then and now has been a simple one; to help mutual fund investors build and maintain portfolios that help them reach their goals.

I'm very lucky to be here this afternoon with three FundInvestor editors, our current editor and two of our former editors, and they're here to share with us their wisdom from the past 20 years.

I'd like to introduce first Russ Kinnel, current editor of Morningstar FundInvestor. Russ has been editing FundInvestor since 2004, and he also leads Morningstar's Fund Ratings Committee. Thank you for joining us.

Russ Kinnel: Good to be here.

Dziubinski: In the center is Christine Benz. Christine is our director of personal finance and a senior columnist for, and Christine is also author of 30 Minute Money Solutions, a step-by-step guide to managing your finances.

And last but not least is John Rekenthaler. John is vice president of research for Morningstar. In this role, John oversees Morningstar's research methodologies, and John has played a very important role in creating many of the proprietary measures at Morningstar, including our Star Rating and Style Box.

So welcome everyone. Thank you for joining us this afternoon.

Russ, I want to start with you since you are the current editor of FundInvestor. Twenty years ago when we launched FundInvestor, we were trying to address the topics and concerns of the day. So I think the feature article was on style investing, and we had an article on the Morningstar Style Box, which also debuted in 1992. We featured a popular up-and-coming fund, Fidelity Disciplined Equity, and we also talked about strategic income funds, which were kind of new and on-the-scene and topical at that point.

So if you were publishing the first issue of FundInvestor today, what are those topics that are top of mind for you that you would be including in that issue?

Kinnel: Well, I think it has to be about "how do I get income," because in this environment, it's really hard to get income without taking on big risks, and the Fed has recently upped their ante with QE3, which is essentially a process by which they are buying a bunch of mortgage-backed bonds in an attempt to spur housing, in an attempt to keep interest rates low for the next three years.

So it's very hard to find good fixed-income opportunities and not take on too much risk. The hard answer, the short answer, is you can get a little bit of income, but you can't get what you used to get because there is just too much risk involved, rates are too low ...

Dziubinski: Right.

Kinnel: ...and unfortunately there's just not that much income out there.

Dziubinski: Christine, speaking of income, that's a great question for you as director of financial planning. What are some strategies you would offer to income-seekers today in this environment for getting an income that they need without taking on undue risk?

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