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Investing Specialists

Morningstar Runs the Numbers

We take a numerical look through this week's Morningstar research. Plus, our most popular articles and videos for the week ended July 1.

Inspired by Harper's Index (with a tip of the hat to FiveThirtyEight's Significant Digits blog), Morningstar Runs the Numbers uses a numbers-based approach to highlight recent Morningstar research, along with some outside news stories.

25 funds
Christine Benz highlights the 25 U.S. mutual funds with the largest outflows over the past year. PIMCO Total Return PTTRX topped the list:

Dwarfing every other fund on the outflows front over the past year was PIMCO Total Return (PTTAX); an estimated $22 billion of assets were withdrawn in the one-year period ended May 31. Perhaps even more staggeringly, that figure represented a major improvement over the prior one-year period, when investors yanked an estimated $127 billion from the fund. Initially, at least, investors appeared to be pulling assets in the wake of the late-2014 departure of former manager Bill Gross, which prompted a reorganization of the fund's leadership and the firm. Those outflows sparked additional concerns about the firm's ability to manage the portfolio amid such heavy redemptions. More recently, however, investors may be responding to performance; the fund lagged the Barclays Aggregate index by roughly a percentage point in 2015 and is off to an underwhelming start so far in 2016, too.

In his Quarter-End Insights for financial services, Michael Wong notes the sector's current valuation:

The financial services sector remains reasonably undervalued and recently traded at a market-cap-weighted price to fair value estimate ratio of 0.88.

The U.S. Census Bureau has an infographic that contrasts 30-year-olds of today versus those in 1975--big differences in marriage rates, home ownership, etc.

Dan Wasiolek on the effect of Brexit on Priceline (PCLN):

We estimate that the U.K. is around 15% of Priceline's total bookings, and should the pound remain at current levels of GBP 1.37 to the U.S. dollar, it would represent around a 1-percentage-point headwind to total bookings growth this year.

50 book covers
The top 50 book cover designs for 2015, via the AIGA and Design Observer.

3 proposals
John Rekenthaler examines three proposals from a law professor who specializes in mutual fund legislation:

William's final suggestion is his simplest. The SEC should do its job. He writes, "Our current enforcement efforts come in two dominant strains: misplaced private lawsuits and feeble public ones." The private lawsuits are misplaced because, as is the nature of damage-seeking actions, they attack companies that have the deepest pockets, not those that are the guiltiest.

433 acting credits
New York Magazine's Vulture blog lists the most-prolific creators in different fields. It seems like Robert Pollard has enough output to merit inclusion.

5 steps
Also from Christine Benz, a 5-step midyear portfolio checkup for investors:

Step 3: Drill into your sub-equity exposures.

In addition to assessing your portfolio's baseline stock/bond exposure, also drill beneath the surface to ensure that your portfolio's sub-allocations are in line with your targets and that you're not making an large, inadvertent bets. As the second quarter of 2016 winds down, one key weighting to keep an eye on is your equity portfolio's share of foreign stocks. Foreign names have dramatically underperformed U.S. over nearly every trailing period; if you haven't rebalanced, it's a good bet your weighting overseas is lower than you intended it to be.

$1.19 million
ESPN takes a look at the deferred compensation of former Mets player Bobby Bonilla, who will receive $1.19 million a year through the year 2035. The deal's structure might have been inspired by investments the team's ownership made with Bernie Madoff:

The Mets have never really talked about the deal, but it is well known that their owners, the Wilpons, had many accounts with investor Bernie Madoff. Madoff was returning 12 to 15 percent a year in what we now know were fictional returns. So deferring deals wasn't a problem because the payout would occur years later and the interest rate would be lower than the money they were (fictionally) getting back from Madoff.

Most Popular Articles, Videos, and Securities

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Wells Fargo
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David Harrell does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.