Know the Manager Before Choosing a Fund
08/04/07 - 11:19 AM EDT
Vern Hayden
Finding a mutual fund with a good manager at a well-respected company is the key to picking the right one for your portfolio.
You're not investing in some disembodied vehicle. There are real people behind all of the numbers you see. You cannot understand the numbers unless you understand the managers, their investment philosophies and their skill at implementing those philosophies. As you can see, I always emphasize the importance of a manager. However, I also emphasize how important the company is. One of my favorites is Thornburg Investment Management, whose funds I use in most portfolios because they meet my criteria for a combination of good managers coupled with a good company. (While I use Thornburg both personally and professionally, investors need to research funds for themselves to decide if they fit their personal needs. But I think it's valuable that my readers understand why I use certain fund companies so they can make their own decisions in an informed manner.) As CEO Garrett Thornburg moved out west to Santa Fe, N.M., you could easily envision him as a lead character in a Louis L'Amour western novel. Tall, quietly confident and an air of pioneering intelligence, Thornburg left Wall Street to create his company in 1982. One of the first -- and perhaps the very first -- to have a family of bond funds that ladder maturities, he built a flawless reputation for quality and integrity. Having gathered a strong and competent bond team Thornburg plucked one of the finest equity managers in the country from USAA to start the first of several equity funds. His name is Bill Fries, who in 1995 started the (TVAFX Quote - Cramer on TVAFX - Stock Picks)Thornburg Value Fund (TVAFX), followed soon thereafter by (TGVAX Quote - Cramer on TGVAX - Stock Picks)Thornburg International Value Fund (TGVAX). Both have received top accolades from both Morningstar (including International Manager of the Year in 2003) and Lipper.
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