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January 22, 2015 at 06:29 AM
Morningstar, Inc., announced Wednesday its 2014 U.S. Fund Manager of the Year award winners — featuring managers with Primecap Management, JPMorgan, Western Asset, Robeco Boston Partners, and Dodge & Cox.
Morningstar selected managers who not only delivered impressive performance in 2014 but also showed excellent long-term risk-adjusted returns in five categories: domestic stock, international stock, fixed income, alternatives and allocation.
Drumroll, please — here are the 2014 Fund Manager of the Year award winners in the United States:
Domestic Stock
Morningstar awarded the Domestic-Stock Fund Manager of the Year award to the team from Primecap, which includes Theo Kolokotrones, Joel Fried, Al Mordecai, Mohsin Ansari and James Marchetti. The team runs three Primecap funds and three subadvised Vanguard funds: Primecap Odyssey Aggressive Growth (POAGX), Primecap Odyssey Growth (POGRX), Primecap Odyssey Stock (POSKX), Vanguard Capital Opportunity (VHCOX), Vanguard Primecap Core (VPCCX) and Vanguard Primecap (VPMCX).
According to Morningstar, in 2014, all six funds under the Primecap team generated returns greater than 13.5%, ranking in the 11th percentile or better in their categories. Four of the six funds finished in the top 1% of their categories.
Three of the managers have more than $1 million invested in each of the six funds, and two managers have between $100,000 and $500,000 invested in each.
Jon Hale, Morningstar’s director of manager research for North America, called the long-term record of these winning Primecap funds “outstanding.”
“The team has made a lot of money for many people at a low cost,” Hale said in a statement. “All six funds place in the top 5% of their categories over the trailing 10-year period, and Vanguard Primecap and Vanguard Capital Opportunity have 15-year records that respectively rank in the top 2% and top 1% of the large-growth category.”
Large holdings in pharmaceutical and biotechnology stocks like Biogen Idec, Amgen, and Eli Lilly — which gained more than 20% each last year — paid off in 2014, according to Morningstar. As did their airline holdings: top holding Southwest Airlines more than doubled and United Continental Holdings, Delta and American Airlines each gained more than 60%.
The Primecap team previously won Morningstar’s Domestic-Stock Fund Manager of the Year award in 2003 for Vanguard PRIMECAP and Vanguard Capital Opportunity.
International Stock
Charles Pohl, Diana Strandberg and team with Dodge and Cox International Stock (DODFX) were awarded Morningstar’s international-stock fund manager of 2014. The nine-person Dodge and Cox International Stock policy committee runs this fund, and each of the members has been with Dodge and Cox for more than a decade. The team also won this award in 2004.
The fund saw double-digit gains from long-time pharmaceutical holdings Novartis and Roche. Hewlett-Packard stock, which the managers stuck with during the years when most investors shunned it, also rose significantly. Fixed Income
In fixed income, Ken Leech, Carl Eichstaedt and Mark Lindbloom with Western Asset Core Bond (WACSX) and Western Asset Core Plus Bond (WAPSX) were awarded top honors by Morningstar.
