(PUB) Morningstar FundInvestor

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Fund News

Fund Manager Changes

American Funds EuroPacific Growth AEPGX Date: 05-30-14 Rob Lovelace has stepped down from this fund, though he will continue on his other two funds. His replace- ment is Lawrence Kymisis, who has 19 years of investment experience and has been a comanager of American Funds SMALLCAP World SMCWX since 2007. | Our Take: It’s a blow to lose one of the most-seasoned and best-known managers at the fund. However, with 10 listed managers plus a sleeve run directly by analysts, it’s likely that Lovelace was running less than 10% of the portfolio. Many seasoned hands remain at the fund. Date: 06-30-14 Ronald Strauss and Rick Singer retired at the end of June. | Our Take: We are maintaining our Bronze rating because three comanagers remain who have been leading the way. Bill Pekin, Adam Strauss, and Josh Strauss are the managers we’ve spoken to over recent years, and we feel comfortable with them in the lead. Impact: Negative Appleseed APPLX Impact: Negative

Tweedy Closes Fund to New Investors Tweedy, Browne Global Value II TBCUX announced it would close to new investors as of Aug. 11 . Tweedy, Browne said the closing is because “undervalued securities are currently very difficult to come by.” Tweedy, Browne’s other funds remain open because they have received smaller inflows on a percentage basis. At Tweedy, Browne Global Value II , cash had reached 25% . The fund with the next-highest cash level is Tweedy, Browne Global Value TBGVX , which has a cash stake of 20% of assets. It might not be too far from closing, either. I like seeing a fund close because of a lack of oppor- tunities, but I’d hesitate to conclude this means the market is at a top. The firm last closed Tweedy, Browne Global Value TBGVX in 2005 , a couple of years before the top. American Funds Files ETF Plans American Funds has filed plans to launch an actively managed exchange-traded fund. The fund would be “nontransparent,” meaning it won’t publish daily port- folios that would enable outsiders to recreate the portfolio for arbitrage purposes. That mechanism is crucial to keeping ETF s trading near their net asset values. However, American and other active managers don’t want to disclose daily portfolios for fear of front- running. So they’re submitting these nontransparent ETF s to regulators with a complicated way to work around the issue. New Rules for Money Market Funds The SEC issued new rules for money market funds in July. John Rekenthaler shared his take:

Calamos Market Neutral Income CVSIX Date: 06-26-14 Lead manager Christopher Hartman has left. Eli Pars was added to the management team in his place. | Our Take: We have lowered this fund’s rating to Neutral from Bronze. Impact: Negative

FPA Perennial FPPFX Date: 06-03-14 Steven Geist is retiring from FPA. Comanagers Eric Ende and Greg Herr are dividing his duties. | Our Take: Herr was named comanager in August 2013, so he’s quite new, but Ende has been on board since 1999. That reassures us that the fund is still in good hands. We have lowered our rating to Silver from Gold to reflect both the loss of Geist and our confidence in Ende and Herr. Date: 10-31-15 Brian Rogers will step down in October 2015 and be replaced by John Linehan, who ran T. Rowe Price Value TRVLX from 2003 to 2009. From 2009 to now, he’s served as head of T. Rowe’s U.S. equity team. | Our Take: Linehan has a decent record, but it’s not the equal of Rogers, so we have lowered the fund’s rating to Bronze from Gold. Date: 06-30-14 Amit Wadhwaney left. Matthew Fine, who has comanaged the fund since 2012 and had been an analyst on the fund since 2003, took over as the lead manager. Wadhwaney’s exit comes in the wake of other departures from the international team. In April 2013, Jakub Rehor, who had been a long-tenured analyst and named to the fund’s portfolio-management team in January 2013, left the firm. Two other analysts also left that month, though Third Avenue has since brought them back as consultants. | Our Take: Wadhwaney and the analysts’ departures are a big blow, and we’ve downgraded the fund to Neutral. Date: 06-10-14 Robert Rewey III has replaced Ian Lapey. Rewey comes to Third Avenue from Cramer Rosenthal McGlynn. He was one of several comanagers, so he doesn’t have much of a track record. | Our Take: We have lowered the fund’s rating to Neutral from Bronze because of Rewey’s record and because there seems to be a steady exodus from the firm. Date: 07-01-14 Gordon Scott replaced manager Heather Carrillo. Carrillo had run the fund pretty tightly with the S&P 500 Index and hadn’t impressed in performance. | Our Take: We had rated the fund Neutral last year because of Carrillo’s unimpressive track record. Since March 2011, Scott has been one of a team of comanagers on Fidelity Advisor Stock Selector Mid Cap FMCAX. Because of the multimanager format, there’s not much to go by for Scott. Impact: Negative T. Rowe Price Equity Income PRFDX Impact: Negative Third Avenue International Value TAVIX Impact: Negative Third Avenue Value TAVFX Impact: Negative Fidelity Export FEXPX Impact: Neutral