New Funds: The Value Meal Sequel

Posted by: Lauren Young on March 9, 2006

New mutual funds used to be quite the rage back in the latter part of the 1990s. In 1998, more than 303 new funds were launched. But last year, far fewer new funds were born. You can blame the bear market for that. I’ve been pretty blasé about new funds, but suddenly, there are some good ones out there. (Fellow blogger Aaron Pressman had a recent post about new funds that have caught his eye.)

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A new fund I think looks especially interesting is Ariel Focus, which invests in 20 mid-cap and large-cap stocks. Why Ariel? Before I joined BusinessWeek in 2003, I wrote a profile about John Rogers, CEO of the Ariel funds. Rogers is all about consistency and focus. Simply put, he wants as many choices as possible made in his life so that he can focus on picking stocks. That’s why he eats McDonalds hamburgers (plain) at least ten times a week. John has multiple pairs of the same Ferragamo shoes. He buys the same shirts, toothbrushes, even River Queen Caju Peanuts in multiples. He had one kid to cut down on parent-teacher conferences. My favorite quote in the story came from his ex-wife: “You try living with that, honey.” (And, if you read the link, you’ll see he’s a die-hard BusinessWeek subscriber!)

Rogers may not be one for spontenaity, but he’s certainly a great stockpicker. His value-minded Ariel fund, which invests in small-cap value stocks, is up an annualized 12% for the past five years through the end of February, according to the BusinessWeek Mutual Fund Scoreboard.

And while Rogers isn’t the lead manager on Ariel Focus, you can bet your bottom dollar that the two managers—Tim Fidler and Charlie Bobrinskoy—are well-schooled in John Rogers school of money management. The fund opened to new investors last month—top holdings include Pfizer, Hewitt Associates and Accenture. If you are hungry for bigger stocks, this could be a good value meal for your fund portfolio.

Reader Comments

George Davis

March 25, 2006 2:16 PM

I want to sell my portfolio in the stock market and put the proceeds into a 100% no load mutual fund. Is this such a fund?

George

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About

Bloomberg Businessweek’s Ben Steverman focuses on the latest moves in financial markets and emerging trends in stocks, bonds, and funds, always with an eye toward giving readers a better understanding of the sometimes confusing and often chaotic world of money. Standard & Poor’s senior index analyst Howard Silverblatt will also provide his take on companies’ finances and the markets. Voted one of the “Top 100 Finance Blogs” in 2007.

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