Oakmark Fund: Second Quarter 2022

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.

Bill Nygren、David Herro · 1991 · 美国芝加哥Deep value / contrarian long-term

Theme and Background

This chapter presents key performance and expense data for the Oakmark Fund (Investor Class) as of June 30, 2022. The report aims to demonstrate the fund's long-term return track record since its inception in 1991, while also highlighting the significant impact of recent market volatility on short-term performance.

Core Thesis

The author's core judgment is that the Oakmark Fund has demonstrated robust long-term return capabilities (12.11% annualized since inception), but has experienced substantial drawdowns in the near term (1-year and 3-month periods), underscoring short-term market risks. The fee structure is relatively stable, but it should be noted that the net expense ratio depends on a contractual waiver agreement effective through January 27, 2023, after which adjustments may occur.

Key Arguments and Data

Long-Term Performance: Since its inception on August 5, 1991, the annualized total return is 12.11%, with 10-year at 11.99% and 5-year at 8.54%, indicating long-term compounding growth ability.
Short-Term Drawdown: The 1-year return is -14.61%, and the 3-month return is -17.79%, reflecting significant losses due to recent market volatility.
Fee Comparison: The gross expense ratio is 0.93%, and the net expense ratio is 0.91%, with the difference stemming from a contractual advisory fee waiver agreement. The net expense ratio is lower than the gross ratio, but the waiver period ends on January 27, 2023, after which it may revert.

Metric	Value
Annualized Return Since Inception	12.11%
10-Year Annualized Return	11.99%
5-Year Annualized Return	8.54%
1-Year Return	-14.61%
3-Month Return	-17.79%
Gross Expense Ratio	0.93%
Net Expense Ratio	0.91%

Companies/Assets Involved

Oakmark Fund (Investor Class): The core fund analyzed in this report. The author holds a positive view of its long-term performance (12.11% annualized since inception), but the short-term performance (1-year -14.61%) signals risk. In terms of fees, the net expense ratio of 0.91% is lower than the gross ratio of 0.93%, but the waiver period is limited.

Investment Implications

Short-Term Risk Priority: Investors should be wary of the impact of recent market volatility on the fund's net asset value. The substantial drawdowns over the 1-year and 3-month periods indicate that the current environment is unsuitable for short-term speculation.
Long-Term Holding Strategy: Annualized returns since inception and over 10 years both exceed 11%, supporting a long-term holding logic, though short-term volatility must be endured.
Fee Focus: Although the net expense ratio of 0.91% is lower than the gross ratio, the waiver period ends on January 27, 2023. After expiration, fees may rise, and investors should assess the impact of cost changes on long-term returns.