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Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.

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the July / post-Morningstar issue of MFO is live

Charles is back, with some really sharp observations from the Morningstar Investment Conference. I, likewise, chip in my 10 cents' worth. Minor snark might be involved.

Devesh reports on his two day visit with Artisan. I report on the 10 international funds - passive/smart beta/active, funds and ETFs, developed and developing are all rep'd - with the greatest consistency of strong performance over the past 10 years.

Lynn takes on the question, if Berkshire Hathaway were recognized as a mutual fund, which kind of mutual fund would it be?

We formally partnered with Morningstar on a research-based article on the fund families you can trust. At base, we meld together Lipper's 3-, 5- and 10-year Lipper Leader winners for consistent returns with MFO's top family designations with Morningstar's firm success metric (that even some of the Morningstar analysts did know it existed) that is survivorship-bias free. Not to break the news, the Dodge & Cox crushes pretty much everybody.

The Shadow tracked down an awfully lot of executions and shared word of the Primecap reopening.

And, speaking of shared words, Charles shares word on a July 10 webinar to acquaint folks with MFO Premium's upgrades.

Hope you enjoy!


  • edited July 3
    Good items in MFO July 2024 issue.

    My Notes.

    Re @David_Snowball
    Fund family ratings are provided by MFO, Morningstar, Barron’s, et. These typically are based on asset-weighted performance of funds within the fund family. Morningstar has Parent Hub and Ratings that can be accessed from fund Quote pages. The main utility of fund family ratings seems in PR or bragging rights (no DIY investor limits to 1 fund family & then allocates $s proportionately within).

    Re @TheShadow
    TCW Total Return Bond Fund will be changed to TCW Securitized Bond Fund.
    My guess Is that this faddish new name won’t stick for long. Suddenly, "securitized" is an in-word.

    BNY Mellon Government Money Market Fund will disappear on or about August 27, 2024.”
    What may be going on here is that BNY Mellon has eliminated the “Dreyfus” name from all/most funds except the m-mkt funds. In fact, “Dreyfus” name is being used exclusively for all/most BNY Mellon m-mkt funds, see the list below. This is just an internal realignment of its m-mkt fund lineup, and people shouldn’t think that Government m-mkt fund category has developed some issues.

    In a related news, BNY Mellon/BK is also dropping "Mellon" from general use, so it would simply be BoNY. The full name BNY Mellon will be used only in legal or formal filings.

    BoNY is the oldest bank in the US and counts Alexander Hamilton among its founders. Many here may know it due to "Pershing", as in BNY Pershing. BoNY is now #13 in the list of the biggest US banks by assets. Top 5 US banks are JPM, BAC, C, WFC, GS; notably, GS got its general banking charter only during the GFC 2008 only (as did MS).
  • @devesh

    Interesting analysis but unfortunately Artisan International Value is closed except to existing accounts or advisors as is Artisan International Explorer (only advisor and institutional shares available, latter $1,000,000 minimum at Schwab)

    ARTGX seems to be similar to ARTKX in performance, but it is currently 50% US stocks, making me think it's international stock picks have done less well
  • edited July 3
    David - Outstanding issue. Thank you.

    You & Chip are in for a real treat in Michigan’s UP. Tahquamenon Falls State Park, about 10 minutes from Paradise, is one of my favorite spots. Also near Paradise is Whitefish Point with a small shipwreck museum and from where you can gaze at the waters where the Edmund Fitzgerald (of Lightfoot fame) floundered and sank during a November storm. If you don’t mind the combined aroma of fudge & horse manure you’d enjoy Mackinaw Island, a 10-15 minute ferry ride from either side of the straits. As you no doubt know, Somewhere in Time, an 80s flick staring Christopher Reeve and Jane Seymore was set on the island and contains scenes shot there. A plaque near the water marks the exact location of a memorable exchange. The Mackinaw Bridge (completed in 1957) is as awe inspiring as ever.

    Re Ian Bremmer’s remark during an interview at the M* conference …

    He believes that the “US is the most dysfunctional major democracy” and democracy’s incumbency is being challenged by disinformation, inflation, and immigration, while people rail against the “elites” in the establishment.

    Part of that assessment has long perplexed me. I sense the “rail against” aspect - residing in a very “red” part of Michigan. The resentment is real. What I don’t comprehend very well is who constitutes this elitist class? Is it the very wealthy (Bezos, Buffett, Bloomberg, etc.)? Or might it include families earning over $200,000 a year? Do retirees receiving pensions, Social Security, Medicare qualify? Does it include those with college degrees? Did Mr. Bremmer attempt to identify / qualify just who these “elites” are?
  • @sma3 I agree with your disappointment that ARTKX is closed. I mention that in the analysis and that we were able to get in through an intermediary. I almost chose not to write the article because the fund is closed. In the end, decided to write, because its more about the process than the outcome. Everyone here makes their own decisions about the funds and stocks.
  • @devo

    Any thoughts on ARTGX's international stock performance? A quick look shows ARTGX Domestic portfolio has some of the usual suspects META 4% GOOGL 4% BRK.B 4% but isn't loaded and no NVDA or MSFT, so I am unsure of how much support this would provide.

    There is not a huge overlap between ARTKX and ARTGX international portfolio at least now.

    Samsung ( both 5%) Danone ( both 4%) Novartis (both 4%) UBS ( 4% s 2.3%)
  • Will come back @sma3 lot of homework this July 4th holiday
  • @devo

    I know of sites that quickly compare portfolios of two ETFs. Do you know of a similar site for mutual funds?
  • I use ycharts and there is a compare feature in there which can be customized. Needs subscription to ycharts.

    MFO premium can drill into top 10 holdings.
  • Thanks Will look at Ycharts
  • July commentary + 1
  • @sma3 hard to compare artgx as a replacement for artkx. artgx has a 45% North America allocation (which I think includes the 8.6% in cash money market ). ARTKX has 12% in North American and I think all of that is just cash money market.

    Since their 10-year performance is similar, I tend to agree that ARTGX's international picks must have been less rewarding than ARTKX's.

    ideally we want to look at the historical holdings or better still average historical holdings but I dont have the fool proof set of tools for that yet.
  • edited July 3

    not sure if I linked the image correctly. its a flows update from mfo premium of flows out of ARTGX. Unfortunately, too many decent funds have nothing but consistent outflows. I can write an article on outflows alone from great funds. its depressing.
  • @Devo, that shortened link is fine as a link.

    But it won't work in the MFO Image tool to post the image here , only the full image-url would work (I am not doing this intentionally).

    There are other differences in these 2 links.
  • edited July 3
    @ybb, which of these should I pick: Links
    Viewer links
    HTML Codes
    HTML full linked
    HTML thumbnail linked
    BBCode full linked
    BBCode thumbnail linked
  • @Devo, my options for ImgBB in Chrome are a bit different:

    Links (non-code links)
    Viewer Link - this is the shortened link.
    Direct Link - this is the full image URL for the MFO Image tool. It's fine for linking too.
    HTML Codes

    I use Direct link more as it is universal and not really long.
  • edited July 4
    A long time ago, in a galaxy far, far away two young Jedi fought side by side against ...

    Oh, right. Focus. Messrs. Samra and O'Keefe were fast rising stars analysts under David Herro at Harris Associates (i.e., the Oamark funds) together. They left Harris in 2002 over a disagreement concerning when they would be named partners. (Ed Studzinski, who was there at the time, sort of chronicled it in a 2018 essay.) They joined Artisan Partners and posted spectacular numbers running International Value together. They launched Global Value and put up spectacular numbers, all of which led to huge inflows. They were nominated six times as Morningstar's International manager of the year, and won the award twice. In 2018, they made a management decision to separate teams ... Mr. Samra would lead International Value, Mr. O'Keefe would lead Global Value.

    Over the past five years, both have done well. It's just that in both absolute and relative terms, International has done a lot better. (Top 3% versus top 30%, with a several hundred bps lead in absolute returns at a time when international, broadly speaking, trailed.) Oddly, Global was held by against its peer group because it had less exposure to hot US stocks than its average peer.

    One might conclude that Mr. O'Keefe is good and Mr. Samra is great. In any case, Morningstar just upgraded Global to a Gold analyst rating, arguing that the team is becoming deeper and more cohesive.

    For what that's worth.
  • edited July 4
    Mr. Samra has delivered excellent results at ARTKX.
    I hope his former mentees Beini Zhou and Anand Vasagiri replicate his success at ARDBX. ;-)
  • @David_Snowball

    Thanks for the history. I have always been a little concerned about "key person" syndrome where all of the outstanding attributes of a company or investment are attributed to one person. One wonders why these two guys developed different international portfolios.

  • Mr. Samra has delivered excellent results at ARTKX.
    I hope his former mentees Beini Zhou and Anand Vasagiri replicate his success at ARDBX.;-) ALSO here !! Starter position started.
  • Odd that Schwab apparently allows purchase of ARDBX advisor shares without an advisor and low minimum
  • edited July 4
    sma3 said:

    Odd that Schwab apparently allows purchase of ARDBX advisor shares without an advisor and low minimum

    The minimum investment for ARDBX at several brokerages:
    Fidelity - $2,500
    Schwab - $2,500 (Basic), $1,000 (IRA)
    Vanguard - $500
  • Just ran comparison between ARBDX ARGTX and ARKTX

    Very little overlap in stocks. ARGTX and ARKTX share about 9%. ARBDX almost nothing
  • should be ARBDX
  • @sma3: ARDBX is predominantly small and micro cap. It holds only 22 positions representing 60% of AUM and still has a lot of cash, despite trading for more than 2 years. Quite a different animal compared to the Artisan LC international and global funds. The managers apparently spent a long time after their hiring date to prepare their new fund for business. One hopes that patience will be rewarded.
  • Just in passing, we should note that the Artisan International Explorer strategy existed before the fund launched. The strategy initiated in November, 2020. The fund launched in May, 2022. The strategy, as a whole, has over $350 million in assets.

    Mr Zhou was an analyst under Mr Samra for 7 years before leaving to become a portfolio manager for Matthews. He returned to Artisan in 2020 but, I would guess, he returned bearing a non-compete agreement. And so he was able to run private but not public money.

    Since inception, the strategy has returned about 13.7% annually while it's benchmark index has returned just under 8%. It has outperformed in both up and down years with an active share of 99.3%.

    I've spoken with Mr Zhou twice. The first time was in person and I was deeply impressed. The second time was a weird video call with him and his co-manager in a conference room with a robo camera. The danged camera kept pivoting and refocusing. I think it was ceiling mounted. It did not engender a good conversation. Perhaps I should try again.
  • thanks David

    very interesting
  • edited July 5
    Artisan Partners used to have an Artisan International Small Cap Fund for several years in which it was closed (I believe it was opened in 2001). It was later renamed to the Artisan International Small-Mid Fund in 2018. Originally, Mark Yockey used to be one of the co-managers of the International Small Cap Fund.
  • "Artisan Partners used to have an Artisan International Small Cap Fund for several years in which it was closed (I believe it was opened in 2001)."

    I owned this fund years ago.
  • I owned it too until they changed it over at which time I sold it. The old fund was expected to pay $7/$8 per share capital gain on the brink of the change, so I unloaded it.
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