January 25, 2017
Harris Associates is pleased to announce that David Herro has been named Morningstar’s International Stock Fund Manager of the Year in the United States (2016) for Oakmark International.
David serves as the Chief Investment Officer of International Equities and portfolio manager of four Oakmark Funds: International, International Small Cap, Global and Global Select. He joined Harris Associates, adviser to the Oakmark Funds, in 1992. David’s other awards from Morningstar include being named International-Stock Fund Manager of the Decade for the 2000-09 period and International-Stock Fund Manager of the Year in 2006, both for Oakmark International and Oakmark International Small Cap.
Established in 1988, the Morningstar Fund Manager of the Year award is designed to recognize portfolio managers who demonstrate excellent investment skill and the courage to differ from the consensus to benefit investors. According to Morningstar, to qualify for the award managers’ funds must have not only posted impressive returns for the year, but the managers also must have a record of delivering outstanding long-term risk-adjusted performance and of aligning their interests with shareholders’.
“We are delighted that David’s outstanding contributions have been acknowledged by Morningstar,” said Kristi Rowsell, president of the Oakmark Funds. “Our investment team works tirelessly for our shareholders, and we are proud to have that effort recognized.”
Oakmark’s investment philosophy is centered on the belief that superior, long-term results are achieved through investing as owners in quality companies that can be purchased at a significant discount to their true economic value. The Oakmark International Fund seeks capital appreciation by investing in larger capitalization companies located outside of the U.S. The Oakmark International Small Cap Fund seeks capital appreciation by investing in small capitalization companies located outside of the U.S. The Oakmark Global Fund invests primarily in a diversified portfolio of common stocks of U.S. and non-U.S. companies across the market-cap spectrum. Finally, the Oakmark Global Select Fund seeks capital appreciation by investing in a concentrated portfolio of mid and large capitalization companies from around the world.
Oakmark Global, Oakmark International and Oakmark International Small Cap Funds: Investing in foreign securities presents risks which in some ways may be greater than U.S. investments. Those risks include: currency fluctuation; different regulation, accounting standards, trading practices and levels of available information; generally higher transaction costs; and political risks.
Oakmark Global, Oakmark International Funds and Oakmark International Small Cap Funds: The Funds’ portfolios tend to be invested in a relatively small number of stocks. As a result, the appreciation or depreciation of any one security held will have a greater impact on the Funds’ net asset value than it would if the Funds invest in a larger number of securities. Although that strategy has the potential to generate attractive returns over time, it also increases the Funds’ volatility.
Oakmark International Small Cap Fund: The stocks of smaller companies often involve more risk than the stocks of larger companies. Stocks of small companies tend to be more volatile and have a smaller public market than stocks of larger companies. Small companies may have a shorter history of operations than larger companies, may not have as great an ability to raise additional capital and may have a less diversified product line, making them more susceptible to market pressure.
According to Morningstar: The Fund Manager of the Year award recognize portfolio managers who demonstrate excellent investment skill and the courage to differ from the consensus to benefit investors. The Fund Manager of the Year winners are chosen based on Morningstar’s proprietary research and an in-depth evaluation by its manager research analyst team. Up to five awards are given every year for managers from each of the following asset classes: Domestic Stock, International Stock, Fixed Income, Allocation, and Alternatives. To be eligible for the award, managers must run funds that are under Morningstar manager research analyst coverage, which includes approximately 1,200 open-end U.S. funds, and have received a Morningstar Analyst Rating™ of Gold, Silver, or Bronze over the past 12 months. To be nominated, managers must not only have posted impressive returns for the year, but also have a long-term record of delivering outstanding risk-adjusted performance and aligning their interests with those of shareholders. Nominations are made by Morningstar manager research analysts, then narrowed to a list of finalists by a nominating committee. The entire analyst team meets to debate the merits of the finalists in each asset class. Voting commences immediately after each asset-class meeting, and nominees receiving the most votes are the winners.
According to Morningstar: The Fund Manager of the Decade award recognizes fund managers who have achieved superior risk-adjusted results over the noted 10-year period and have an established record of serving shareholders well. While the awards focus on performance over the past decade, Morningstar takes into consideration other factors, including the fund manager’s strategy, approach to risk, size of the fund, and stewardship. Both individual fund managers and management teams are eligible, and being a previous winner of the Morningstar Fund Manager of the Year award isn’t a prerequisite. Morningstar’s fund analysts select the Fund Manager of the Decade award winners based on Morningstar’s proprietary research and in-depth evaluation.