I've been planning to liquidate our holding in Matthews Pacific Tiger (MAPTX) and was going to put that money into Artisan International Value (ARTKX), but have discovered it is closed to new investors; bummer!
What alternatives would you suggest? My priorities:
1. Long-term, sustained outperformance versus a relevant benchmark
2. stable management
3. low fees (expense ratio); no-load
4. low turnover
5. available from our Vanguard brokerage account
6. invests primarily overseas; we already have plenty of US-based investments
Thanks for any suggestions!
Randy
Comments
Unrelated, but I recently switched MATFX (w/painful distributions) to MINV.
https://www.matthewsasia.com/funds/etfs/
Have you considered Vanguard International Growth?
1. Top-decile 10 Yr and 15 Yr fund category returns (period ending 03-31-23)
2. Schroder Investment Management advised since 1981; Baillie Gifford advised since 2003
3. Expense Ratio: VWILX - 0.34% ($50K min.); VWIGX - 0.45% ($3K min.)
4. Turnover: 2019 - 13%; 2020 - 20%; 2021 - 25%; 2022 - 15%
5. Available via Vanguard brokerage
6. 87% foreign; 13% U.S. (as of 01-31-23)
Vanguard International Growth is a volatile fund with a standard deviation of 25.16 as of 03-31-23.
M* classifies the fund as high risk relative to the Foreign Large Growth fund category.
VWILX performance in 2022 was terrible - it declined 30.79%.
Schroders is the other manager with 30% AUM and follows tamer growth strategy.
Question should be - how effectively Anderson trained his Baillie Gifford colleagues who had some overlaps with him?
NOT a sleep-well fund.
in addition to managing Vanguard International Growth and two other U.S. mutual funds.
He was instrumental in developing/implementing the firm's successful global growth investing strategy.
However, Baillie Gifford (BG) has a deep bench and Mr. Anderson's succession was well-planned.
Thomas Coutts (joined BG in 1999) has managed the fund alongside Anderson since 2016.
Lawrence Burns (joined BG in 2009) was added as a fund manager in 2020.
MAPIX is a fairly aggressive Asia-focus fund relative to a broadly diversified developed market fund such as ARTKX. VWILX is also quite aggressive with 30% emerging market exposure (20% to China). Over the long term the fund has done well but last year it lost 30.8%. That is something @@randynevin can decide.
The relative underperformance of Coutt's' fund BGETX since the start of 2021 may be attributed to that fund being "purer" growth than VWIGX. The Vanguard fund gets some "tamer growth" (per Yogi) from the 30% managed by Schroeders. The Schroeders component explains virtually all the difference. This can be inferred from this PortfolioVisualizer graph. It compares (since Jan 2021) BGETX, VWIGX, and SCIEX (pure Schroeders, managed by the same Schroeder managers as on VWIGX).
In case more evidence is needed, we can compare recent (post Anderson) performance of VWIGX with a pure Anderson fund. Yes, he's still managing an international fund, just not one based in the US. Desjardins Overseas Equity Growth, out of Canada. Anderson's the sole manager, and like VWIGX, this fund has 14% of its equity in the US with the rest outside of the US and Canada.
https://www.morningstar.ca/ca/report/fund/portfolio.aspx?t=0P00011073
In 2022, Anderson's fund ranked at the 100th (Canadian) percentile, losing 33.12% while Coutts' BGETX lost 34.43%. YTD, the former gained 10.47% while the latter gained 11.27%. Hard to tell the two apart. At least from a distance.
https://www.morningstar.ca/ca/report/fund/performance.aspx?t=0P00011073
As others have stated, analysts play a large role. https://portfolio-adviser.com/will-baillie-gifford-avoid-the-major-transition-pitfalls-as-growth-architect-james-anderson-leaves/
I personally would stay away from all Matthews Asia funds in the near-term (possibly long-term).
There has been an exodus of talent at the firm over the past few years.
https://www.mutualfundobserver.com/discuss/discussion/comment/152046
https://www.mutualfundobserver.com/discuss/discussion/comment/156101
https://www.mutualfundobserver.com/discuss/discussion/comment/159415
Franklin Templeton International Low Vol, Hi Div ETF (LVHI) - better than ARTKX in every way over the past three years except total return LVHI book 15%, ARTKX 21%. The R2 is 85.
Causeway International Value (CIVIX) - same returns, higher volatility. The R2 is 96.
Fidelity International Value (FIVLX) - lower returns (17 vs 21%), comparable Ulcer Index (7.2 vs 6.5). High correlation (98) to Artisan, which implies they're playing the same game but Artisan is playing it better.
Artisan Global Value (ARTGX) - high correlation (97) but slightly trails ARTKX in pretty much all metrics.
All are top tier since the screen started with low Ulcer / high returns.
For what interest that holds,
David
ER is 1.42%. Portfolio’s market capitalization is $600 M (small caps) and the benchmark the fund used is MSCI AC World Ex USA Small Cap Index. Additionally, the fund has 26% small cap emerging market exposure.
https://artisanpartners.com/individual-investors/investments/international-value-team/international-explorer-fund-ardbx.html
Within the past couple of years I purchased IHDG and FYLD for their yield. They held up better than VWIGX during the recent excitement. But neither has a long track record.
So far, I haven't had to tap either for yield. So far, I am happy with them.
Investors with $1M - $5M in eligible funds can execute 25 trades gratis per calendar year.
Fidelity charges $49.95 to buy TF funds but there are no fees to sell.
It appears the $5 automatic investment option (after initial investment) at Fidelity may be available for ARDBX.
Interested parties should probably contact Fidelity to confirm this is correct.
The first choice, and most obvious standout, was ARTKX, but since it is closed I had to go elsewhere. If it opens up in the future with the same manager I'll seriously consider opening a position there too, as the steady outperformance has been impressive.
Also, check VTRIX, VWICX, and Avantis International Large Value ETF AVIV if you are OK with ETFs.