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7 Funds Reopening Amid Equity Meltdown

Past bear markets have shown that there likely will be more reopening announcements on the way.

Editor's note: Read the latest on how the coronavirus is rattling the markets and what investors can do to navigate it.

We've received the first flourish of fund reopening announcements, and I'm sure there will be more. Some firms will reopen funds because stocks appear cheap, while others will reopen in order to stem the tide of outflows. So far, outflows from equity funds have been much milder than in bond funds, but past bear markets have shown that eventually investors begin to redeem many of their equity funds.

On Friday March 27, 2020, Wasatch announced it was immediately reopening three funds. "The reopening of the strategies reflects Wasatch's view that current market volatility and dislocations present attractive opportunities for long-term investors," the firm said in a press release. "The firm remains committed to thoughtfully managing capacity and will continue to close strategies to protect performance for existing shareholders."

Wasatch reopened Small Cap Growth WAAEX, Core Growth WGROX, and International Growth WAIGX. Wasatch Small Cap Growth, which has a Morningstar Analyst Rating of Gold, had been closed since 2011. International Growth had been closed since 2014, and Gold-rated Core Growth had been closed since 2018.

Artisan International Value ARTKX reopened to new investors on March 18, after having been closed since 2011. The fund is rated Silver.

Artisan Small Cap ARTSX is also reopening. The Silver-rated fund had $1.9 billion under management at the end of February. The fund's managers say they see compelling valuations for high-growth companies. The fund has had steady outflows since closing to most new investors since 2013.

On March 26, Fidelity announced that Fidelity Small Cap Growth FCPGX and Fidelity Small Cap Discovery FSCRX will reopen on April 1 to new investors. Fidelity Small Cap Growth had $3.8 billion of assets under management after closing in February 2018 at $4.2 billion. The fund is rated Bronze.

Fidelity Small Cap Discovery had closed in January 2013. It had $2.4 billion at the end of February and is rated Silver.

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About the Author

Russel Kinnel

Director
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Russel Kinnel is director of ratings, manager research, for Morningstar Research Services LLC, a wholly owned subsidiary of Morningstar, Inc. He heads the North American Medalist Rating Committee, which vets the Morningstar Medalist Rating™ for funds. He is the editor of Morningstar FundInvestor, a monthly newsletter, and has published a number of prominent studies of the fund industry covering subjects such as manager investment, expenses, and investor returns.

Since joining Morningstar in 1994, Kinnel has analyzed virtually every type of fund and has covered the most prominent fund families, including Fidelity, T. Rowe Price, and Vanguard. He has led studies on the predictive power of fund data and helped develop the Morningstar Rating for funds and the Morningstar Style Box methodology. He was co-author of the company's first book, Morningstar Guide to Mutual Funds: 5-Star Strategies for Success (Wiley, 2003), and was author of the book Fund Spy: Morningstar's Inside Secrets to Selecting Mutual Funds That Outperform, published in 2009.

Kinnel holds a bachelor's degree in economics and journalism from the University of Wisconsin.

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