Oakmark is the mutual fund family launched in 1991 by Harris Associates, the Chicago deep-value firm founded in 1976 (about $105bn AUM). Bill Nygren runs the flagship Oakmark Fund and David Herro the Oakmark International Fund, buying businesses at large discounts to intrinsic value and holding them like owners — publishing quarterly fund commentaries, market commentaries and insight articles.
This report looks at how the Oakmark Fund performed in the third quarter of 2011. Since it started in 1991, it has earned an average of 11.51% per year, which is good. But in the last year it lost 0.67%, and in the last three months it dropped 14.05%. For regular investors, this means: holding for the long term can pay off, but short-term market swings can cause losses. Don't panic and sell when things go down. It's worth reading because it shows you need to balance long-term gains with short-term risks, and watch out for fees (1.11%) that eat into your returns over time.
Oakmark Fund (Investor Class) reported average annualized total returns as of September 30, 2011: 11.51% since inception on August 5, 1991, 4.13% over 10 years, 0.93% over 5 years, -0.67% over 1 year, and -14.05% over 3 months. The gross expense ratio (as of September 30, 2010) is 1.11%. Core view:
This section focuses on the performance of the Oakmark Fund (Investor Class) as of September 30, 2011. By presenting average annualized total returns across different time horizons, the report reveals that the fund has achieved steady gains over the long term (since its inception in 1991), but recent negative returns (over one-year and three-month periods) reflect the impact of heightened market volatility on the fund's short-term performance.
The report's core investment argument is that the Oakmark Fund has delivered significant positive returns over the long term (since its inception in 1991), but the negative returns over the recent one-year and three-month periods indicate that short-term market fluctuations can erode gains, requiring investors to balance short-term risks with long-term returns. This assessment contrasts with the market consensus, which typically emphasizes long-term holding, by highlighting the immediate impact of short-term volatility on actual returns.
The report supports its view with the following data:
| Time Horizon | Average Annualized Total Return |
|---|---|
| Since Inception (August 5, 1991) | 11.51% |
| 10-Year | 4.13% |
| 5-Year | 0.93% |
| 1-Year | -0.67% |
| 3-Month | -14.05% |
This section does not mention specific companies or assets, focusing solely on the performance data of the Oakmark Fund itself. The fund is a diversified portfolio, and no holdings details are disclosed.
For investors, this data suggests that while holding the Oakmark Fund over the long term can yield positive returns (annualized 11.51%), recent market volatility (3-month return of -14.05%) may lead to short-term losses. Investors should assess their own risk tolerance, avoid panic redemptions during short-term downturns, and be mindful of the cumulative impact of expenses (1.11%) on long-term returns. It is recommended to maintain disciplined investing during volatile markets and consider diversification to reduce single-fund risk.