News & Insights from Oakmark

News & Insights

25th Anniversary of Oakmark International

October 4, 2017

September 30, 2017, marked the 25th anniversary of the Oakmark International Fund. Proudly, we were able to deliver an average return of 10.4% per year over the life of the Fund. This return is comfortably ahead of the MSCI World ex USA Index return of 6.2% and our Lipper International Fund Index of 7.1%. I am deeply grateful for the support and patience granted by our shareholders. Averages are often comprised of extremes and we have experienced some sharp downturns over short periods that were greatly outnumbered by periods of very strong performance. I firmly believe there is a trade-off in managing for short-term return versus long-term return, and am appreciative of our clients’ patience during weak periods.

I am also deeply appreciative of the many who contributed to the success of this Fund. First, to Victor Morgenstern, then Chairman of Harris Associates, and his fellow partners for hiring me in August of 1992, which gave me the opportunity to start the Oakmark International Fund. Even prior to my employment, Victor and I began laying the groundwork to get Oakmark International registered and opened for business as soon as possible. Then came all those who joined me to work as analysts, traders, administrative assistants, fund accountants, etc. All of these people have played an important role in the success of the Oakmark International Fund. My very first hire, Michael Welsh, was perhaps the most important in terms of the success of the Fund. He started a few months after the Fund’s inception. His experience as a former valuation expert at one of the large accounting firms helped bring tighter structure to our valuation process. Before Michael’s retirement, he was the Fund’s first co-manager.

Lastly, it is my belief that investment success is achieved by having a sound philosophy and the discipline (and freedom) to execute this philosophy through all market conditions. For me, the attraction of joining Harris Associates in 1992 was that the firm possessed that very culture. The investment professionals at Harris/Oakmark have received continuous support, whether it be from our Fund Trustees or Natixis, the current owners of our firm, which has permitted us to carry out the execution of our version of value investing.

David Herro,
Partner, Portfolio Manager and Chief Investment Officer - International Equity



Average Annual Total Returns (as of 03/31/2019)

Fund QTD 1-Year 3-Year 5-Year 10-Year Inception
OAKIX 9.04% -14.13% 6.40% 1.08% 11.83% 9.14%
MSCI World Index ex US 10.45% -3.14% 7.29% 2.20% 8.82% 5.84%

Gross Expense Ratio (as of 09/30/2018): 1.01%
Net Expense Ratio (as of 09/30/2018): 0.96%
Fund Inception:  09/30/1992

Past performance is no guarantee of future results. The performance data quoted represents past performance. Current performance may be lower or higher than the performance data quoted. The investment return and principal value vary so that an investor’s shares when redeemed may be worth more or less than the original cost.

The MSCI World ex U.S. Index (Net) is a free float-adjusted, market capitalization-weighted index that is designed to measure the equity market performance of developed markets, excluding the U.S. This benchmark calculates reinvested dividends net of withholding taxes using Luxembourg tax rates. This index is unmanaged and investors cannot invest directly in this index.

The Lipper International Fund Index reflects the net asset value weighted total return of the 30 largest international equity funds. This index is unmanaged and investors cannot invest directly in this index.

The Oakmark International Fund’s portfolio tends to be invested in a relatively small number of stocks. As a result, the appreciation or depreciation of any one security held by the Fund will have a greater impact on the Fund’s net asset value than it would if the Fund invested in a larger number of securities. Although that strategy has the potential to generate attractive returns over time, it also increases the Fund’s volatility.

Investing in foreign securities presents risks that in some ways may be greater than U.S. investments. Those risks include: currency fluctuation; different regulation, accounting standards, trading practices and levels of available information; generally higher transaction costs; and political risks.

The discussion of the Funds’ investments and investment strategy (including current investment themes, the portfolio managers' research and investment process, and portfolio characteristics) represents the Funds’ investments and the views of the portfolio managers and Harris Associates L.P., the Funds' investment adviser, as of the date written and are subject to change without notice.

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CUSIP identifiers have been provided by CUSIP Global Services, managed on behalf of the American Bankers Association by Standards and Poor’s Financial Services, LLC, and are not for use or dissemination in a manner that would serve as a substitute for any CUSIP service.  The CUSIP Database, © 2011 American Bankers Association.  “CUSIP” is a registered trademark of the American Bankers Association.

Investing in value stocks presents the risk that value stocks may fall out of favor with investors and underperform growth stocks during given periods.

Before investing in any Oakmark Fund, you should carefully consider the Fund's investment objectives, risks, management fees and other expenses. This and other important information is contained in a Fund's prospectus and summary prospectus. Please read the prospectus and summary prospectus carefully before investing. For more information, please call 1-800-OAKMARK (625-6275).

OAKMARK, OAKMARK FUNDS, OAKMARK INTERNATIONAL, and OAKMARK and tree design are trademarks owned or registered by Harris Associates L.P. in the U.S. and/or other countries.

Copyright 2019, Harris Associates Securities L.P., Distributor, Member FINRA.
Date of first use: January 24, 2013.

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