Morningstar Advisor - April/May 2011 - (Page 6)
Editor-in-Chief Jerry Kerns Managing Editor Ryun Patterson Editor-at-Large Don Phillips Contributing Editors Dan Culloton, Paul Justice, Haywood Kelly Contributors Karin Anderson, Michael Breen, Alison Finn, Melinda Gerber, Philip Guziec, Theresa Hamacher, Maciej Kowara, Samuel Lee, Jim Licato, Robert Pozen, Jeffrey Ptak, John Rekenthaler, Carl Richards, Miriam Sjoblom, Kate Stalter, RJ Towner, Christopher Traulsen, Rob Wherry Data Editors Preethi Parmar, Alina Tarlea Proofreader Jennifer Gierat Art Director Teofila Arellano Associate Art Director Alexander Skoirchet Production Designer Summer Bornman Illustrator Brett Ryder Photographer Christopher Lane
Alison Finn and Karin Anderson
Although both work at Morningstar, Alison Finn (left) and Karin Anderson first met at a microfinance conference last year in Chicago. Each was interested in “impact investing”—the idea of using market forces to do good in the world. “We each were waiting to speak with Paul Blythe of MicroPlace,” Finn says. “He had mentioned that it would be critical to the industry for a well-respected organization like Morningstar to provide information about impact investments.” Their meeting inspired them to write “Investors Lend a Hand” (Page 62).
As a consultant with Ibbotson Associates, Maciej Kowara pays a lot of attention to fees. One question has always puzzled him: Why are bond funds cheaper than stock funds? After all, the pricing differences don’t seem to reflect the differences in effort that goes into running each. “I like to believe that in the markets things happen for a reason, even if that reason isn’t immediately apparent,” Kowara says. “The topic seems to have been largely ignored by researchers, so I set out to find a plausible reason.” In “The Tamer Ride” (Page 58), he might have discovered it: volatility.
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Robert Pozen and Theresa Hamacher
“The biggest problem the U.S. fund industry faces today is taxation,” says Robert Pozen, the former fund executive, “and it’s causing fund management companies to move jobs overseas.” Pozen and Theresa Hamacher, president of the National Investment Company Service Association, spell out how the U.S. fund industry is losing the innovation and growth race to Europe in “The Global Fund-Leadership Playoffs: Europe vs. the United States” (Page 38). “European UCITS funds have become a well-known brand worldwide, and the U.S. fund industry is playing catch-up,” Hamacher says. Pozen and Hamacher also are the authors of The Fund Industry: How Your Money Is Managed (Wiley, 2011).
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Morningstar Advisor is published bimonthly by Morningstar, Inc., 22 W. Washington St., Chicago, IL 60602. An annual subscription for delivery in the U.S. is $60. All exhibit data in this magazine is provided by Morningstar and Ibbotson Associates unless otherwise noted. © 2010 Morningstar. All Rights Reserved. The information contained herein: (1) is intended solely for informational purposes; (2) is proprietary to Morningstar and/or its content providers; (3) may not be copied or distributed; (4) is not warranted to be accurate, complete, or timely; and (5) does not constitute investment advice of any kind. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. “Morningstar” and the Morningstar logo are registered marks of Morningstar, Inc. Disclosure: Morningstar licenses its indexes to certain providers, including Blackrock Institutional Trust Company, N.A., First Trust, and Deutsche Bank, for use in exchange-traded funds and exchange-traded notes. These ETFs and ETNs are not sponsored, endorsed, issued, or sold by
Brett Ryder is the first illustrator of the magazine we’ve asked back. He illustrated the April/May 2009 issue. (His cover won a best-cover award from Folio.) His clients include NatWest, T-Mobile, Penguin Books, Financial Times, Los Angeles Times, The New York Times, Amex, and Dr. Stuart’s Tea. He also illustrates weekly columns in The Telegraph and The Economist.
Morningstar. Morningstar does not make any representation regarding the advisability of investing in ETFs and ETNs that are based on Morningstar indexes.
Morningstar Advisor April/May 2011
Table of Contents for the Digital Edition of Morningstar Advisor - April/May 2011
Morningstar Advisor - April/May 2011
Letter From the Editor
The Debate That Matters Most
What Can the Mutual Fund Industry Do Better?
Cool Logic, Warm Intent
How to Start a Mutual Fund
Owner and Operator
Middle East Revolts Roil Oil Markets
Four Picks for the Present
How We Improve Our Odds of Picking Outperformers
Health Care Survived 2010, but Investors Want Proof
The Global Fund-Leadership Playoffs: Europe vs. the United States
U.S. Fund Investors Have It Good
U.S. Fund Firms Learn to Speak UCITS
The Tamer Ride
Investors Lend a Hand
Healthy, Wealthy, and Wide
Foreign Funds That Win at Concentration
Mutual Fund Analyst Picks
50 Most Popular ETFs
Undervalued Stocks With Wide Moats
VAs Finish 2010 With a Solid Gain
Buying Good Funds, Poorly
Morningstar Advisor - April/May 2011