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With the dollar anticipated to continue losing value against other currencies, would it be a prudent move to move out of this fund into another unhedged fund such as Oakmark international? I'm a buy and hold investor, and would keep the fund (either TBGVX or another one) for another 10 years at least.
I don't know that OAKIX isn't hedged -- they just selectively hedge. The older Tweedy Browne is entirely hedged. (Don't ask me why the hedged and unhedged versions have the same E/R's, however).
I often wonder why the ER is as high as it is, and no move over the years to reduce it. It's not like they trade often, and to quote their reports, 'we won't invest where we can't drink the water'.
I've wondered the exact same thing. I note the hedging issue, above. I also wonder if its a result of their "deep dive" research process (but, TB also admits to using outside research on occasion). Their funds (except for TBHDX) are genuinely all-cap, and they do have a record of closing their funds when AUM become large, so maybe the E/Rs are a function of lesser economy of scales with regard to both of the latter issues.
If TB has another conference call (I've emailed them -- nothing planned thus far for 2011) I'm going to put this question to them, as well as a couple of others.
I've been taking a closer look at their funds for a while now (want to do a simulation study this weekend or next to explore a thesis I have). TB's funds do above average in terms of downside protection, but not so great in terms of capturing the upside.
But, to your original point, the E/R thing has always been a mystery to me.
14 years on board with TBGVX, and i agree: the ER, like the rent, is just too dam high. An old firm, a reputable house: TB should cut the ER in half. It is time.
TBGVX with $4.8B in AUM has an excessively high expense ratio of 1.40%. I am not interested in this fund, regardless of their hedging stance. First Eagle Overseas (SGOIX), which is reportedly available for a reasonable minimum in retirement accounts at Thinkorswim and Wellstrade, is definitely a more attractive fund in this space.
Vanguard International Value (VTRIX) seems to have performed comparably with TBGVX over the past 10 years. Expense ration is only .39, over 100 basis points less than Tweedy Browne. Am I comparing apples to oranges, or is this a viable alternative?
First Eagle Overseas (SGOIX) has outperformed, by a large margin, both TBGVX and VTRIX over the past 1-, 3-, 5-, and 10-year periods, despite the low expense ratio of VTRIX.
SGIIX and SGOIX have been purchased fairly recently by M* forum members for reasonable minimums in Thinkorswim and WT retirement accounts using online trades. Of course these windows of opportunity may close quickly.
What I can't understand is why Morningstar rates TBGVX as being low risk. In 2008 the fund lost 38%, while the EAFE lost 43%. That hardly seems like low risk to me. If the fund were to protect you in bad times, then the high ER would more than pay for itself. This fund doesn't seem to offer any downside protection.
I don't get that either -- prior to 2008, Tweedy's funds did okay. With respect to international, at least, 2008 took them down, less so than many stock funds, but they also took a surprisingly large shot in the chops. Further, Tweedy's international recovered more slowly than others'.
Comments
Tweedy,Browne Global Value II Ccy Unhdg - TBCUX
I'll refrain from making a 10 year market prediction though.
If TB has another conference call (I've emailed them -- nothing planned thus far for 2011) I'm going to put this question to them, as well as a couple of others.
I've been taking a closer look at their funds for a while now (want to do a simulation study this weekend or next to explore a thesis I have). TB's funds do above average in terms of downside protection, but not so great in terms of capturing the upside.
But, to your original point, the E/R thing has always been a mystery to me.
An old firm, a reputable house: TB should cut the ER in half.
It is time.
Kevin
http://performance.morningstar.com/fund/performance-return.action?t=VTRIX®ion=USA&culture=en-US
It looks to me like SGOIX has a minimum of $1,000,000 there.
David