Oakmark International Fund: Third Quarter 2013

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 section presents the performance data of the Oakmark International Fund (Investor Class) as of September 30, 2013. The report aims to demonstrate the fund's long-term returns since its inception in 1992 and disclose its fee structure, providing investors with a historical performance reference.

Core Viewpoint

Through historical return data, the author indicates that the Oakmark International Fund has achieved solid long-term annualized returns (11.10%) since inception. However, the recent 1-year return (40.79%) and 3-month return (13.16%) are significantly higher than the long-term average, suggesting that short-term high returns may not be sustainable. The fund's expense ratio (1.06%) is at an industry-average level and does not constitute a significant cost burden.

Key Arguments and Data

Long-Term Performance: Since inception in September 1992 through September 30, 2013, the annualized return is 11.10%, demonstrating the effectiveness of the value investing strategy over a 21-year cycle.
Medium- and Short-Term Performance: The 10-year return is 11.63%, and the 5-year return is 14.42%, both above the long-term average. However, the 1-year return of 40.79% and the 3-month return of 13.16% far exceed historical trends, indicating that recent market volatility or specific holdings contributed to excess returns.
Fees: The total expense ratio is 1.06% (as of September 30, 2012), below the average for actively managed funds, with limited erosion on long-term compounding.

Time Period	Annualized Return
Since Inception (September 1992)	11.10%
Last 10 Years	11.63%
Last 5 Years	14.42%
Last 1 Year	40.79%
Last 3 Months	13.16%

Companies/Assets Involved

This section does not mention specific companies or holdings, focusing solely on the fund's overall performance metrics.

Investment Insights

Value of Long-Term Holding: The fund's annualized return of 11.10% since inception indicates that the value investing strategy is effective across cycles, making it suitable for long-term allocation.
Caution on Short-Term High Returns: The 1-year return of 40.79% far exceeds the historical average. Investors should be wary of market corrections or style shifts and avoid chasing highs.
Controllable Fees: The expense ratio of 1.06% has a limited impact on long-term returns, but attention should be paid to whether it increases in the future.