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M*: The Best Value Funds

FYI: Value is striking back--for now. These value-focused funds all earn Morningstar Analyst Ratings of Silver or better.
Regards,
Ted
https://www.morningstar.com/articles/946456/the-best-value-funds

Comments

  • I'm guessing T. Rowe Price is not paying off someone at M* any more.

    http://schrts.co/qgqzSsUp

    Or maybe an alert was triggered at M*, it's time to write an article on Value funds they had already decided to pump based on last few days performance.
  • "Today we’re shining a spotlight on those that land in the U.S. large-value, mid-value, or small-value Morningstar Categories and that earn Morningstar Analyst Ratings of Silver or better. (We expect such highly rated funds to outperform over a full market cycle...) "

    Mechanically at least, that explains why TRVLX (bronze) isn't mentioned, while PRFDX (a silver T. Rowe Price fund) is included.

    Since the ratings are based on projections for a full market cycle, it seems literally a bit shortsighted to be looking at the short period of just the past eight months (as in chart you linked to). FWIW, here's M*'s chart comparing it with DODGX (the other fund in the chart you linked to) over the full tenure of PRVLX's manager starting at the end of 2009.

    Virtually a dead heat. Total returns are 199.26% for TRVLX vs 199.55% for DODGX. The latter costs less (0.20% vs. 0.78%), has lower turnover (0.20% vs 146%!), and is truer to style (its current portfolio sits in value corner vs. TRVLX's blend portfolio).

    Not that I'm a fan of M*'s analyst ratings. IMHO they are of dubious value. More importantly, when M* restricts articles to the relatively few funds that receive analyst ratings it necessarily excludes many better, smaller funds. Following your theory, that's because these other families aren't "paying someone off". But T. Rowe Price is not among the excluded families. Their funds, including PRSVX, do get analyst ratings.

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