3 Good Funds Having a Great Year
These Morningstar Medalists' returns finished near the top of their respective categories last quarter.
These Morningstar Medalists' returns finished near the top of their respective categories last quarter.
Susan Dziubinski: Hi, I'm Susan Dziubinski from Morningstar. The first quarter of 2019 is officially in the books. Here's a look at three Morningstar Medalist funds whose returns finished near the top of their respective categories last quarter.
Chris Franz: Invesco Small Cap Value is the top-performing fund in the small-value Morningstar Category year-to-date. But this follows a bottom-decile 2018 showing when it shed a quarter of its value. Now the fund also underwent a management change in 2018 when long time comanagers Jonathan Edwards and Jonathan Mueller took over. But the two didn’t change the strategy's aggressive investment approach, which seeks deeply discounted stocks with a contrarian bent but leads to higher volatility. Now the two are patient, and they don’t turn the portfolio over that often, but this high beta profile can lead to wide swings in performance year-to-year. Still, the fund has low fees and recently reopened to new investors in January 2019. Investors can succeed here, but patience and an appetite for risk are required.
Tony Thomas: Neuberger Berman Intrinsic Valueis off to a strong start this year. Investors have been bargain-hunting, and that’s what manager Ben Nahum and his team do well. They look for undervalued and even distressed firms that nonetheless have promising cash flows, and that typically leads them into growthier areas like tech and healthcare and industrials, where their stock selection has been particularly good recently. But this fund is not just a flash in the pan. These managers are very experienced, and they have shown that they can pick stocks well over time and that’s what makes this fund a good option for long-term investors.
Kevin McDevitt: Hotchkis & Wiley Mid-Cap Value has been a very volatile, but very effective fund over time. Its performance in the fourth quarter of last year and the first quarter so far of this year have been kind of perfect microcosm of how this fund does in both up markets and down markets. If you recall in the fourth quarter of last year, we had a pretty nasty correction, and the fund did far worse or at least quite a bit worse than its index. This year has been the opposite of that--and, granted, market conditions have changed, we've had a very strong rally--but this fund has done especially well because a lot of those same positions in energy and financials have bounced back. If anyone looking at this fund, looking to add it to their portfolio, keep in mind that again this is a very volatile, a very aggressive fund. It has outperformed over the long term, but volatility comes with it.
Christopher Franz does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.
Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.
We’d like to share more about how we work and what drives our day-to-day business.
We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.
How we use your information depends on the product and service that you use and your relationship with us. We may use it to:
To learn more about how we handle and protect your data, visit our privacy center.
Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.
To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.
Read our editorial policy to learn more about our process.