(PUB) Morningstar FundInvestor

September 2 014

Morningstar FundInvestor

13

Aston/Fairpointe Mid Cap Leads the Way Leaders & Laggards | Leo Acheson

Laggards MainStay ICAP Select Equity ICSLX

MainStay ICAP Select Equity’s 5% year-to-date return, while respectable in absolute terms, trails more than 90% of its large-value peer group. Its two largest holdings, General Electric GE and Pfizer PFE , have each turned in losses, weighing on results. The team runs a concentrated portfolio of about 30 stocks and normally keeps about half of the port- folio in just 10 names, so one or two struggling picks can have a meaningful impact on performance. Despite the fund’s recent marks, its long-term record remains solid. Oppenheimer International Growth OIGAX This fund has finally cooled off. After outperforming its typical foreign large-growth rival in each calendar year from 2008 through 2013 , Oppenheimer Inter- national Growth has lost 1 . 1% and trailed roughly four fifths of its peer group for the year to date. A few lagging stock picks and light exposure to emerging markets have held the fund back this year. Nonethe- less, since-inception manager George Evans is sticking with his patient, theme-based approach, which has consistently paid off for investors in the long run. In fact, the fund outperformed all of its competitors over the trailing 10 -year period. Delafield Fund DEFIX After significantly lagging its typical mid-value peer in 2013 , Delafield Fund is having another poor showing for the year to date: Its 3 . 3% return has trailed its typical rival by more than 5 percentage points. The portfolio holds roughly 40% of assets in small caps; this has been a significant headwind as small caps have suffered on valuation concerns. A 15% cash stake and several bad picks in the metals and mining and specialty retail industries have also hampered returns. œ Contact Leo Acheson at leo.acheson@morningstar.com

Leaders ASTON/Fairpointe Mid Cap CHTTX

Ten Best-Performing Funds

Fund Name

YTD Cat Rank %

This fund continues to reward patience. After turning in mediocre relative returns in each year from 2010 through 2012 , the fund delivered excellent results in 2013 and so far in 2014 . Rebounds by long-held positions such as Lexmark International LXK and Molson Coors Brewing TAP , as well as recently added names Alcoa AA and Edwards Lifesciences EW , contributed to strong gains this year. The man- agers build a relatively focused portfolio of about 40 stocks and use a long-term, low-turnover approach. As a result, it’s not uncommon for the fund to lag in the short term before recovering nicely. The fund’s long-term track record ranks among the mid-blend category’s best. Third Avenue Value TAVFX Third Avenue Value has returned 9% so far this year, surpassing its typical world-stock competitor by more than 3 percentage points. Hong Kong real estate stocks, which took about 15% of assets as of June 2014 , have largely driven those results, as names such as Henderson Land Development, Wheelock and Co., and Cheung Kong Holdings rebounded after a rough 2013 . A new lead manager took the reins on this fund in mid- 2014 , so near-term adjustments to the portfolio are likely. Loomis Sayles Bond LSBRX Loomis Sayles Bond is on pace to deliver its third consecutive year of top-quintile results. Its 7 . 4% year-to-date return easily surpasses its typical multi- sector-bond rival’s 5 . 3% gain. The management team has used flexibility to its advantage, taking positions in high-yield bonds ( 18% of assets), convert- ibles ( 9% ), and equities ( 6% ), all of which have performed well this year. The portfolio also holds a roughly 30% stake in non-dollar-denominated bonds, which boosted performance in the first half of 2014 .

ClearBridge Aggressive Gr Dodge & Cox International Domini Social Equity Inv Fidelity Capital & Income

1 1 1 1 1

Fidelity Independence Matthews India Investor 1 Meridian Small Cap Growth 1 Oakmark Select I 1 PRIMECAP Odyssey Aggressi 1 Royce Low Priced Stock Sv 1

Ten Worst-Performing Funds

Fund Name YTD Cat Rank % Vanguard Precious Metals 100 Ariel Discovery Investor 99 CGM Focus 99 Conestoga Small Cap Inves 99 Greenspring 99 Neuberger Berman Genesis 98 Sequoia 98 Third Avenue International 98 Weitz Hickory 98 Artisan Small Cap Value I 97