Bottom Up Stock Picking Helps US Fund Achieve Morningstar’s 2015 Fund Manager of the Year

Morningstar profiled its Fund Managers of the Year for 2015 recently. Managers are nominated by Morningstar analysts in four categories – equity, fixed income, multi-asset, and alternatives – and selected on the basis of both single-year and longer-term records.

 

The Domestic-Stock Fund Manager of the Year award was shared by Keith A. Lee, Robert E. Hall, Kemption M. Ingersol, Damien Davis, and Andrew J. Fones for their management of the Brown Capital Management Small Company fund, which returned 8.8% for the year and placed in at least the top quartile of its class for 8 of the last 10 years based on Morningstar analysis. Lee, Hall, and Ingersol have been at the helm through strong performances in 2008, 2009, and 2012, among others. Morningstar describes the stock-picking approach as “benchmark-agnostic” and “bottom-up.” It concentrates in certain sectors, recently healthcare and tech, and the managers describe a preference for firms that may “save lives, time, money, or headaches.”

 

The International-Stock Fund Manager of the Year award was shared by Robert Lovelace and his team for management of the American Funds New Perspective fund, which is run by a team located in the U.S., U.K., and Asia. The managers come from two company subsidiaries and run the fund in separate sleeves without sharing investment ideas across subsidiaries. This produces a more diverse fund with “relative resilience.” It’s three- and five-year records finished 2015 in the 12th percentile of its class, with the 10-year record in the fourth percentile. In the third quarter of 2015, the fund limited losses to 6.5% while the MSCI All Country World Index fell 9.5%, in part because of a fairly small stake in emerging markets.