![]() Funds that were more concentrated in their largest holdings could have up to half their portfolio invested in positions that were each over 5% of assets, but they must register as non-diversified funds to alert investors to their higher risk level.Īt Oakmark, we are long-term investors. It determined that a diversified fund should have no more than one-quarter of its assets in positions that each represent over 5% of its portfolio. In the 1940 Act, the SEC said mutual fund investors should be alerted to a fund’s high risk if it isn’t adequately diversified. Many portfolio managers think of their risk of getting fired, so to them, tracking error (how much their portfolio return differs from their benchmark index) becomes the most relevant risk measure. ![]() They measure daily stock price changes and use risk metrics like beta, standard deviation and correlation. ![]() Academics get frustrated by that definition because it isn’t easily quantified. Business owners say risk is the chance their business is worth less in the future than it is today. We agree that an investment with higher risk requires higher return, but we don’t agree on how to measure risk. “Risk” could be the word that investment professionals most disagree about. “Risk has a very good colloquial meaning – a substantial chance that something could go horribly wrong.” – Charlie Munger To obtain the most recent month-end performance data, view it here. ![]() The investment return and principal value vary so that an investor’s shares when redeemed may be worth more or less than the original cost. Current performance may be lower or higher than the performance data quoted. Past performance is no guarantee of future results. The performance data quoted represents past performance. Oakmark Fund - Investor Class Average Annual Total Returns Įxpense ratios are from the Fund’s most recent prospectus dated Januactual expenses may vary. ![]()
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