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These Skilled International-Stock Skippers Foundered in 2010

But these funds still have what it takes.

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It was anything but easy sailing for foreign-equity managers in 2010, even though most overseas stock markets ended the year with high-single-digit or low-double-digit gains in dollar terms. Nearly all of the world's equity exchanges experienced a lot of volatility during the year. There also was quite a bit of variation in performance across the geographic, style, sector, and market-cap spectrums in 2010. Indeed, emerging markets handily outgained developed exchanges; growth stocks comfortably outpaced value issues; the industrial and materials sectors returned far more than the health-care and utilities sectors; and small-cap names gained much more than large-cap stocks.

Many talented foreign-equity managers navigated these challenging seas very well. For example, Brent Lynn of  Janus Overseas (JAOSX), who won the Morningstar 2010 International-Stock Manager of the Year award, earned top-notch gains. David Herro of  Oakmark International (OAKIX), Rohit Sah of  Oppenheimer International Small Company (OSMAX), the team at  Tweedy, Browne Global Value  (TBGVX), and David Winters of  Wintergreen (WGRNX)--who were finalists for the award--produced first-rate results as well.

However, several skilled international-stock skippers struggled in 2010's demanding conditions. Three who posted especially poor results run very prominent funds. Thus, we decided to take a close look at what caused their funds to languish last year and whether there are any causes for long-term concern.

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

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