Oakmark Equity & Income IOAKBX

Morningstar Rating

Fund Research and Analysis

by John Coumarianos

Oakmark Equity & Income has missed a blistering run in corporate bonds, but we're not too worried about it.

Veteran managers Clyde McGregor and Ed Studzinski run this moderate-allocation fund as if it will be the only one in an investor's portfolio, and they work primarily to avoid losses. Read more

Kudos

The fund has delivered top-decile performances over the long haul.

Thorough, value-oriented strategy.

Comanagers invest significant portions of their own and their families' money in the fund.

Fund has closed and reopened at prudent times that protect existing shareholders. Read more

Risks

The fund's value orientation could hold it back in a growth rally.

The fund's all-cap approach could be a burden in blue-chip-led rallies.

Fund isn't as small and nimble as it used to be.

Energy exposure leaves this fund vulnerable to commodity price volatility. Read more

Strategy

Management keeps the fund's stock/bond mix close to 60/40, but bottom-up stock-picking drives the fund's asset allocation. On the stock side, the managers target value stocks, with an emphasis on cash-rich companies, and they keep the portfolio concentrated. Read more

Management

Clyde McGregor has managed the fund since its inception and is a large shareholder in the fund. Edward Studzinski joined him in March 2000. McGregor became an analyst with Harris Associates, the fund's advisor, in the early 1980s, and Studzinski joined Harris as an analyst in 1995. Read more

Inside Scoop

This fund swims against the stream. Unlike most hybrid vehicles, it is full of cheap, smaller, cash-rich companies. The fund's bond portfolio typically includes Treasury bonds and a smattering of high-yield and non-U. Read more

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