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Fund Spy

Two New Funds from IVA Hold Loads of Promise

We're recommending these funds right out of the gate, but there are risks attached.

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It's not often that we're ready to endorse a fund that's just eight weeks old. But then again, the new offerings brought by investment startup International Value Advisors at the beginning of October 2008, IVA International (IVIOX) and IVA Worldwide (IVWAX), are a special case.

We do recognize some risks in jumping in this early. The research infrastructure, for example, isn't completely built out, though the firm is hiring analysts. And there are operational uncertainties associated with small and new firms. But there are several reasons for our enthusiasm for these funds (available only through financial advisors): the people and process behind the offerings, current market conditions, and reasonable fees.

A Rose by Any Other Name
IVA's funds feel quite familiar. After Charles deVaulx abruptly left Arnhold and S. Bleichroeder, advisor to  First Eagle Overseas (SGOVX) and  First Eagle Global (SGENX), in March 2007, four other employees shortly followed in his footsteps to strike out on their own. Charles deLardemelle, Simon Fenwick, Michael Malafronte, and Lawrence Borsanyi set up shop near the end of 2007 as a new investment firm and began investment operations in February 2008. Once deVaulx's non-compete agreement had expired, he joined IVA as a partner. Subsequently, Tara Hannigan has followed, joining Borsanyi in more of a marketing role. DeVaulx and deLardemelle serve as co-portfolio managers of IVA International and IVA Worldwide.

Bridget B. Hughes does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.