Greetings MFO's,
As the end of 2012 quickly approaches - now that the world did not end today - I was reflecting on my mutual fund holdings. Many of the funds pleasantly surprised me such as PIMIX, FPIVX, GPIOX ... But I found myself being consistently drawn to a fund in my portfolio that disappointed me the most.
Now when I say disappointed, I don't mean that its returns were bad or negative, but just that I expected so much more based on the expertise and skill of the portfolio manager. Perhaps, and most likely, my expectations were not realistic and I have no one to blame but myself.
And so the fund that disappointed me the most (that I own) in 2012 is ARIVX. While carrying 50% of the portfolio in cash throughout the year, the fund missed out on so much upside. I know that this frustrated the heck out of the manager, Eric Cinnamond, and I empathize with him. But at the same time, 2012 was an opportunity lost in the small cap value space of my portfolio.
So let me ask the MFO community: Which fund disappointed you the most in 2012 and why?
Mike_E
P.S. Thank you David for your great dedication and sacrifice in making this one of the best websites on investing.
Comments
In terms of stocks, a disappointment was Vodafone (VOD), as well as Glencore (GLCNF.PK). Glencore is a long-term holding and I've added recently (and I'd add more if given another opportunity to do so.)
Janus acquired a majority stake in 2008 (prior to that it had held 30%), and started marketing the heck out of Perkins - relabeling funds, launching new funds, etc. And performance dropped into bottom quarter by 2010. Perkins did manage top half performance in 2011, and they manage funds conservatively, but in a good year like 2012, one still hopes they don't lag so far behind as to make long term investing with them futile.
Perkins had been one of the few, or only, bright spots for Janus.
Now that I sold it, gold silver can again start to outperform again
PREMX TRAMX SFGIX MAINX MACSX MAPIX MAPOX and MSCFX.
http://en.wikipedia.org/wiki/Pyramid_scheme#Connection_to_multi-level_marketing
CGM Focus is one of the top fund holders of HLF.
http://finance.yahoo.com/q/mh?s=HLF+Major+Holders
Appleseed Fund APPLX / APPIX is another more conservative fund that is performing "as expected." It seemed to be lagging earlier in the year but has since caught up somewhat because of better resilience to volatility. Again, not a disappointment but one that I will continue to monitor.
I sold FAIRX fairly early in the year but do not have sellers remorse over it. No need to be greedy.
Can't say I'm really disappointed with any fund I've owned in the past year, though.
Edit: in case anyone notices a discrepancy between selling a fund partly because it's mostly IG corporate (VWIAX), and buying a fund named Investment Grade Corporate (PIGIX), check out the PIGIX holdings ... the fund isn't what the name implies.
GLRBX was doing great, its performance looks fantastic, but I guess it is in part because of its smallcap and midcap part, in part because of having 50% in bonds, 70% of which were in Treasuries. This last part seems pretty dangerous looking forward, just as the small-mid cap US stocks. Only 3% of the fund are in international stocks. It helped to protect the fund from the Europe disaster, but will it continue helping it in the future? I hope the managers of the fund will be flexible enough with their portfolio and change its composition when appropriate. Maybe increasing international and decreasing bond part will make GLRBX more similar to IVWIX? I am not trying to defend IVWIX, I am trying to solve this riddle for myself since I have some $ in IVWIX.
I've put half of the monies in that was in PRPFX into PONDX. A quarter also went into SUBFX and the rest went to fund purchases into RWGFX.
I am not at all disappointed in PRPFX. It is still up 6.5% year to-date. Those funds that have under-performed have lower volatility and have historically lagged when the market is strong. Manager Michael Cuggino has reduced the duration of his Treasuries. I understand the concern many people have about the potential pressure that falling bond values and potentially lower gold prices could have on this fund. But I think the fund will do ok. It is not supposed to shoot out the lights, rather to smooth the waves of volatility. We will stick with it for the forseeable future as a core low-risk hold.
How about UPSIDE surprises? Yeah, a few there, too. IVAEX has had a great year. While I am not surprised the fund had a good year, the 18% gain year to-date is a whopper. Managers Avery and Caldwell have done a really good job. They are among the best at what they do.
Another is GIMDX, demonstrating manager Finkelstein and his team have found a strategy that is working well, despite the fact that M* doesn't like anything about the fund. Investors looking for a local currency fund that does not play around with derivitives might do well to peruse this one. In fact, it's been a great year for foreign bond investors. What will 2013 bring?
ARTMX has had another very strong year. Folks were worried that the fund had gotten too big to out-perform, but a 20% return puts that argument to shame. And DEFIX is going strong again, a fund that remains undiscovered for the most part, which is fine with us. ISTIX has led the tech/science fund group, despite an almost 8% weighting in AAPL. And MAPIX is have another great year, which gives proof that great managers can overcome extreme negative sentiment for a region of the world.
My guess is that most investors are plesantly surprised by the overall positive numbers most of their funds have put up this year.
This question raise another one: which funds would you folks most likely hold for another 1-3 yrs?