Morningstar Advisor - April/May 2009 - 22

Investment Briefs Strapped for Cash? Buy These Funds If clients are a little short on money to invest, director of fund research Russel Kinnel recommends some funds with a minimum initial investment and a commitment to monthly investing of $250 or less. T. Rowe Price Retirement 2040 TRRDX This approach is particularly attractive for people new to the workforce. To make this really work, investors need to step up monthly contributions over time, and the investment can grow into a core holding. Artisan International ARTIX Mark Yockey and team are among the best foreign-stock fund managers around. After last year’s big losses in foreign stocks, interest has definitely cooled, yet many argue that foreign stocks are just as cheap as U.S. stocks. Yockey takes a basic growth-at-a-reasonable-price approach that he applies to big markets and rather small ones. Over time he’s found plenty of winners that way. Jensen JENSX Management looks for high-quality stocks trading at a discount. They employ a patient, low-turnover approach that’s worked nicely over time. Dreyfus Appreciation DGAGX This fund is subadvised by Fayez Sarofim in Houston, and it’s wonderfully consistent. Maybe the biggest difference from Jensen is that this fund owns a fair amount of energy names. More importantly, it has worked. The fund is ahead of the S&P 500 and the large-blend category over the trailing 15 years. T. Rowe Price Equity Income PRFDX Equity dividends are taxed at half the rate of regular income, and stocks paying dividends tend to be more stable than equities as a whole. The reason for owning this specific fund is for Brian Rogers. He keeps risks low, and that’s a welcome thing. He faces the challenge of widespread dividend cuts from U.S. firms, but the fund would still be attractive even if its yield came down from the 3.7% trailing 12-month yield that it boasts today. Two Funds That Listened to Graham Fund analyst John Coumarianos says Benjamin Graham-inspired fund managers who got crushed in the downturn failed to heed Graham’s warnings about debt, concentrating too much on the income statement and not enough on the balance sheet. Coumarianos points out two funds that didn’t make that mistake in 2008. Royce Special Equity RYSEX Charlie Dreifus is explicitly influenced by RETIREMENT INCOME GUARANTEED. Help keep the gray area out of your clients’ golden years. Both the product prospectus and underlying fund prospectuses can be obtained by writing to Nationwide Life Insurance Company, P.O. Box 182021, Columbus, OH 43216-2021. L.inc cost is 0.90%. In New York, the beneﬁts and cost may vary. Spousal continuation is an additional cost. Available with certain Nationwide variable annuities. When evaluating the purchase of a variable annuity, your clients should be aware that variable annuities are long-term investment vehicles designed for retirement purposes and will ﬂuctuate in value; annuities have limitations; and investing involves market risk, including possible loss of principal. The cost of an option may exceed the beneﬁt paid under the option. Carefully consider the fund’s investment objectives, risks, charges and expenses. All guarantees and protections, where available, are subject to the claims-paying ability of 22 Morningstar Advisor April/May 2009 PUBLICATION: DO NOT PRINT DOTTED M8993-10_16x4.5.indd 1

Morningstar Advisor - April/May 2009

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