Morningstar, Inc., will hold its 15th Investment Conference in Chicago on June 25-27. Don Phillips, managing director of Morningstar and the inventor of the company’s style box system, will kick off the annual event with a preconference practice management session on June 25 titled “The Next Step in Holdings-Based Analysis.” Among the mutual fund industry luminaries scheduled to appear are John P. Calamos of Calamos Investments, Jean-Marie Eveillard of First Eagle Funds, Ralph Wanger of Liberty Wanger Asset Management, Mario Gabelli of Gabelli Asset Management, and Marty Whitman of Third Avenue Management. Phillips spoke about the conference and the challenges that face advisors today.
How’s the conference shaping up?
Very nicely. Last year attendance was actually up over the year before, which is amazing in this market when so many conferences are dropping out.
It’s been great to see the conference grow; this is the 15th one we’ve done. The first time we had maybe 70-75 people show up, but everyone who did was incredibly supportive, telling us we had to keep doing this.
Our conference, unlike the ICI conference, which for years preceded ours by a week or so [though not this year; ICI was held May 21-23], was all about the investing side of the [mutual fund] equation, not the operations side. It’s geared around financial advisors, and the people who want to talk about investing. As analysts at Morningstar, you have a phenomenal job: You get on the phone and pick the brains of some of the best investment people in the world. We thought the conference would be a good way to share this with more people: Get some of the best fund managers and advisors who have clients and thus have real-world questions, and bring these parties together.
And the presenters are not just from one fund company or family, which happens at many conferences.
We’ve made a real move over the years to get away from being very scripted. Early on, we let managers give canned presentations, which at first went over relatively well. But as advisors saw more of them, we started getting weaker and weaker marks from attendees for those managers who simply got up and said “Here’s the historical price range for growth stocks versus value stocks, and this shows you why this is exactly the right time to buy my fund” And of course the next manager would have a slide to prove the exact opposite. Over time, those managers who had really slick sales presentations got poor marks from the audience, and those who spoke from the heart, who were more candid and forthcoming, got high marks. So we got rid of the canned presentations, and we give the Morningstar analysts more of a role in the moderation: You cut to the chase and get down to a real discussion of investments, not just a sales presentation. And the audience really appreciates it.
That’s why somebody like Marty Whitman (of Third Avenue Value Fund fame) would fit right in?
Marty couldn’t give a slick sales presentation to save his life. [He's much more likely to say]: “This stock’s a dog, and people who are buying this are nuts.”