We know the mutual fund marketplace may seem overwhelming and over-crowded. And choosing a mutual fund manager goes beyond the investment style alone. Here are some important factors that we believe distinguish The Oakmark Funds:

Consistent investment process: Each portfolio manager at Oakmark applies a consistent investment philosophy and process to building and managing the Funds. We employ in-house research to identify companies we believe are currently trading at a substantial discount to what we consider to be their underlying business value -- what a rational businessperson would pay to own the entire business.

Do not over-diversify: Holding a smaller number of stocks in the portfolio (15-60 stocks, for example, rather than 100-150) is important to our investment philosophy. By building focused portfolios, our managers' best ideas can have a meaningful impact on investment performance. Because a fund that employs a focused approach concentrates its assets in fewer individual securities, its share price may fluctuate more than that of a comparable diversified fund.

While all of The Oakmark Funds typically hold less than 60 securities, The Oakmark Select and The Oakmark Global Select Funds are designed to be our most concentrated funds, usually holding approximately 20 securities.

Personal investment in the Funds: We look for management ownership in the companies in which we invest, as we believe that stock ownership correctly aligns the interests of management with shareholders. We suggest that when investors look at mutual funds, they should also look for significant management ownership. When the management team has a meaningful sum invested side-by-side with other shareholders, you should expect a higher standard of focus and commitment.

At Oakmark, such a commitment is an integral part of our business philosophy. We believe in "eating our own cooking" and encourage employee ownership of the Funds. As of December 31, 2007, the employees of the Funds' adviser, Harris Associates L.P., the Funds' officers and trustees and their families have over $245 million invested in The Oakmark Funds. This compares to an investment of just over $240 million in December 2006, the last date for which we reported holdings. This increase represents a combination of price appreciation and additional purchases.

Value is all that we do: At Oakmark, value isn't just a style of investing; it's the only way of investing. All of our Funds employ the same value investment philosophy and process because we believe that it is the best way, over a long time period, to maximize profit potential while reducing risk. Our style of investing is not necessarily complex but does require conviction and discipline, coupled with a long investment horizon.

Next: Owning Value