Do the Morningstar Fund Manager of the Year Awards Have Staying Power?
Our vice president of research takes a look.
In 2011, the mutual fund managers recently decorated by Morningstar collectively went kerplop. True, the 2010 Fund Managers of the Year at Sequoia (SEQUX) were terrific. But Brent Lynn at Janus Overseas (JAOSX) and Michael Hasenstab at Templeton Global Bond (TPINX) got walloped, finishing near the bottom of their categories. And the Managers of the Decade, named in early 2010, followed up a good 2010 with a year to forget. In 2011, Bruce Berkowitz plunged and Bill Gross suffered his only bad outing in ... well, forever. (The third Manager of the Decade, David Herro of Oakmark International (OAKIX), was about average.)
This predictably has led to jokes about the Morningstar Fund Manager of the Year award being a cousin of the (alleged) Sports Illustrated cover jinx. I'm not going to address that argument, partly because I would have made those same jokes if I were a journalist covering Morningstar, and mostly because there's nothing to address. The Fund Manager of the Year award has been around two decades now, and there has been no pattern of managers heading sharply south--or north--in the year following the award.
John Rekenthaler does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.