Russ Kinnel: Hi, I’m Russ Kinnel, director of manager research for Morningstar. We don’t give out a lot of High People ratings, so let’s look at what it takes to get a High People rating. Simply being experienced or having a lot of analysts around the globe doesn’t cut it. It takes elite managers and analysts with a true competitive advantage to earn a High People rating.
Pimco Total Return is team effort from one of the best bond shops around. Scott Mather, Mark Kiesel, and Mohit Mittal are three outstanding managers. But importantly, Pimco has a deep team of analysts and traders to support the fund. That's really important because it's a wide-ranging fund that invests all over the globe and makes full use of derivatives, so you really need that depth to make it work.
Brown Capital Management Small Company shows that you don't need a massive firm to get a High People rating. Keith Lee and Kempton Ingersol are seasoned managers who know how to pick growth stocks. Brown exemplifies how smaller firms can develop expertise in a niche area that rivals that of the giants.
Dodge & Cox Global has a deep group of analysts and managers. What really stands out here is the long-term focus of the firm and the investment process. Dodge & Cox hires very smart investors, and they typically stay at the firm their entire career. Dodge lets key employees buy ownership of the firm, but they have to sell when they leave. That incentivizes them to stay, and it also ensures that outsiders can't buy the firm.