Great new tools to help you know what you own.
PrintCommentRecommend (-)
Bookmark and Share
By Russel Kinnel | 06-28-10 | 06:00 AM | Email Article

We've improved our mutual fund portfolios pages to help you better understand a fund's holdings. Let's take a walk through the pages.

To find a fund's Portfolio page from any page (Quote, Chart, Fund Analysis, etc.) about a specific mutual fund, click "Portfolio" in the row of tabs below the name of the fund.

Russel Kinnel is director of manager research for Morningstar and editor of Morningstar® FundInvestor℠, a monthly newsletter.

Let's start by looking at the Asset Allocation of  Caldwell & Orkin Market Opportunity . The fund is a long-short fund where management has wide discretion on shifting long and short exposure. The solid bars you see are the net exposure and the clear bars show the long and short exposure. Here you can see that the fund's last portfolio was 46% long U.S. stocks and 19% short for a net exposure of 27% long. You can see the red bar is shorter and goes to the left, meaning they've got a small net short position in foreign stocks. You can see all the underlying data in the table below.

Style Details
Now let's take a look at the Style Details for  Fidelity Dividend Growth . This is the next section below the Asset Allocation section. Larry Rakers took over the fund in 2008, so it's interesting to look at how he's changed the fund. Here we see the fund's average market cap is $11.9 billion, which is well below that of the S&P 500 and the average large-blend fund.

The Ownership Zone and centroid to the right tell you the key story with Rakers. The Ownership Zone encompasses 75% of a fund's holdings and the centroid shows you the weighted average of the portfolio. What you see for this fund is that Rakers casts a very wide net. He's buying all over the style box, from small to large and from value to growth. Rakers' predecessor, Charles Mangum, ran a high-quality portfolio where the centroid was at the top of the style box and the ownership zone was much smaller; he didn't veer far from mega-cap blend. He didn't venture into deep value or aggressive growth, whereas you can see that Rakers casts a big net at this fund just as he did at  Fidelity Balanced .

Sector Weightings
Now we'll look at the Sector Weightings for  FPA Crescent . This shows a fund's sector weightings compared with the category's and the benchmark's. The percentages shown are percent of stocks rather than assets. Thus it sums to 100% even if the fund isn't 100% in equities. In this case, manager Steve Romick has only one third of his fund in equities, so his equity bets are pretty small. In the graph on the right side, the bars represent the fund's weighting; the little vertical bar is the benchmark weighting--in this case Morningstar Moderate Target Risk--and the black triangle is the category average. You can see that Romick isn't one for trying to match peers or benchmarks. He has nothing in software or media. On the other hand he has a much heavier percent of stocks in health care, consumer services, and energy.

World Regions
At the bottom of the page is the World Regions breakdown. At  Artio International Equity II , some regional bets jump out. It has a 12% weighting in emerging Europe compared with 0% for the benchmark and just 1.6% for the category. On the flip side, you can see the fund is significantly underweight Japan and the U.K. Managers Rudolph-Riad Younes and Richard Pell build macroeconomic and sector analysis into their process and they often have big investments that are a little off the beaten path. They have long been fans of central Europe.

Holdings
Now for something completely different, let's check out the Holdings page, linked just below the Portfolio tab, to the right of the Summary link. Let's see how this looks for  Fairholme Fund  .

Here we've created a cool picture of what's been going on in the portfolio. On the X axis, we arranged holdings based on their asset weighting. The stock's year-to-date returns are on the Y axis. Mouse over the dot and you'll see its name, position weighting, and year-to-date return. As you can see, the biggest circle and top holding is  Sears Holdings . It's down about 10% for the year, though it's worked well over the life of the position in the fund. To see the best-performing stocks in the portfolio this year, mouse over those two dots just around the 3.15 line. You'll see that, among Bruce Berkowitz's top winners this year, are controversial financials CIT Group  and  Regions Financial . Way down in the right corner is the worst performer, WellCare Health Plans .

The returns you see here are the stock's returns--not the fund's returns in the stock. If the fund traded the stock at all during the year, then its returns would naturally differ from the stock's.

Equity View
If you scroll down, you'll see the breakdown on the fund's portfolio. It shows the weighting, the shares owned, and the change in shares from the prior portfolio. In this case, we see that, for the quarter ended February 2010, Berkowitz trimmed positions in Sears and  Americredit  while buying  Citigroup  and  Bank of America  shares.

You can also click through to on the Analyst Report link to see what our stock analysts think of the stock. In addition, if you want to see how the holdings are doing today, click on the Equity Prices tab to the right of the Equity View tab and you'll see the gain and loss in each stock. It can be an interesting look when the markets are way up or down.

Premium Details
Now let's look at the Premium Details for  Artisan Global Value Investor . I like to see where bottom-up stock managers invest when given the freedom to invest anywhere. To get a country breakdown, click on the triangle next to the region. In this case, we can see an overweight in Switzerland at 11% of assets and a tiny Japan stake compared with the benchmark's 23% stake.

Now move down and look at the Equity Holdings Performance chart. You'll see a bubble graph like the one on the Holdings page. This time, you can alter the time period and add more holdings if you want. You can see that Signet Holdings  has worked nicely for the fund this year and that Panalpina Welttransport  has been the top name--clearly Samra and O'Keefe don't go for the best-known companies. Now look at the five-year return and you'll see that many of the top holdings were flattish over that period. Not a big surprise given the bear market in 2008. It's worth noting once more that at this point we are looking at the most recent portfolio and the fund might not have held those stocks over that whole period. We will soon add a data field indicating when a particular name was first bought. However, for now, if you do know that the name has been there that long or that the fund has very low turnover, it's an interesting look. Most good fund managers, after all, are thinking long-term and trying to compound capital over the long haul.

Correction: Earlier versions of this report incorrectly stated that GMO Global Balanced Asset Allocation III  has short positions, but it is long-only.

 

FundInvestor Newsletter
Morningstar FundInvestor is
a 48-page newsletter dedicated to helping investors pick great mutual funds, build winning portfolios, and monitor their funds for greater
gains. This one-year subscription consists of 12 monthly issues, a Reader's Guide, and four free investing reports.
Learn more.
 $129.00 for 12 Print Issues $119.00 for 12 PDF Issues
  
Securities mentioned in this article

Ticker

Price($)

Change(%)
Morningstar Rating Morningstar Analyst Report
With Morningstar Analyst reports you can get our expert Buy/Sell opinions on over 3,900 Stock and Funds
Russel Kinnel has a position in the following securities mentioned above: FAIRX Find out about Morningstar's editorial policies.
Sponsored Links
Buy a Link Now
Sponsor Center
Content Partners