Does anyone own this fund, or has anyone researched it (and other EM/foreign bond funds) well?

I have two IRAs; one is fully invested, the other has some cash, and I am thinking of putting the cash into FNMIX.   M* likes the fund a lot.    It has a rare long-tenured manager.
 

I recently bought a bit of it (see "Gator's new portfolio") for it's dependable payout, now at 6%+.  Why does M* only rate it 3*??, it's history doesn't seem to have any hitches.

Hi Chang: I own some in my 401K & IRA. It has done well for me. I have kept adding to it in the 401K also. I consider it as a milder form of EM equities. If you can stand more EM equities, MAPIX is a good equity income fund. Best to you ..... Anil

The star rating of a fund is entirely based on a calculation of past performance compared to other funds in its peer group.  There is no subjective opinion involved.

The biggest flaw is deciding what a peer group is, as no 2 managed funds are alike.  Where you draw the boundaries for a peer group impacts where every fund gets rated.

Often, higher returns comes at the expense of more performance volatility.  For example, higher yielding funds may buy securities that have high, but unsustainable yields. 

I wouldn't let the 3 star rating impact your decision on FNMIX...

I own MACSX as an asian fund.  It's trailing 5 year return is in the bottom 2% of its "peer group."  The last 5 years of this fund has had returns above 20% every year... bottom 2%!  In fact, it is a different kind of mostly chinese (related) fund that buys bonds, preferred stock, and high yield equities.  I wouldn't trade it for any of those 98% better performing funds, because it has a beta that is half that of other emerging market funds... in fact if you look at the plot of a $10k investment in the fund, you see a curve that looks like a bond curve in its lack of volatility.  It's relative return is due to what it invests in... and I will trade the "paultry" 20+% return for some caution any day.  MACSX is closed, but the fund Anil recommended is very similar.

erryl

 

Thanks Anil.   By the way, we're still settling into Dubai (just had internet access connected up today at home) but eventually I should be traveling to Mumbai fairly often.   I'm looking forward to that, although I'd like to go up to Delhi where we can go elephant trekking.

Just yesterday I asked Norbert if he had heard from you and how your relocation was going. We miss your contributions.

Just to confirm what you have already been told -- I too own MAPIX and am quite happy with it.

DI

DI, I am quite sure you invest differently than I, but for more of a buy and hold investor, would you still pick MAPIX over a diversified emerging markets fund?

~Dan

It is a little hard to answer your question without knowing more about your holdings. Let me just say I bought MAPIX because of the expertise and general management quality of the Matthews Funds in Asia which I greatly respect. Matthews is a investor oriented firm which closes funds quickly when they become too large and they have informaive shareholder communications. So I originally went into MAPIX to preserve access to the fund. MAPIX is a conservatively managed fund focusing on companies in the region with the ability to "substantially grow future dividends". That is a focus that appeals to me as a retiree as a way to conservatively participate in that fast growing region.

I do consider MAPIX generally a Buy and Hold investment and I add to my position on weakness but it is not by any means my only emerging or frontier market position so I did not select MAPIX in lieu of other emerging market positions.

If I didn't own any diversifed emerging market fund, would MAPIX be my first pick? In many cases -- yes -- because I believe their expertise is critical in stock election in emerging markets. Personally far too many geographically diversified funds are a bit too indexy and not enough stock pickers for my taste. I tend to prefer a good manager with a clear but perhaps narrower charter to manage.

Hope this helps.

 

just sold it last week..  had it quite a while but coming to the end of the party i think.

Thanks for your concise answer.  I've tracked this fund since it's inception but yet to buy in to it.  I'll probably for the time being get my EM exposure through my other funds and maybe buy this one if we get another downdraft in the market.

Dan

[quote user="DeerIslander"]

Just yesterday I asked Norbert if he had heard from you and how your relocation was going. We miss your contributions.

[/quote]

The relo has been hectic, aggravated by the fact that I'm doing two jobs until I hire a deputy.   Dubai is a very interesting place and poses obvious contrasts.   On the one hand, it resembles Disneyworld with all of the ultra high-tech buildings (an underwater hotel, gigantic palm-shaped islands, the 7-star "Burj Al-Arab" hotel, the 200+ story "Burj Dubai skyscraper", an inddoor ski slope, etc.).  

On the other hand, you can see the evidence everywhere that 20 years ago the natives here were simply fishermen and wandering bedouins.   For example, there is no mail delivery: you have to rent a PO Box and pick up your mail there.   In fact, many houses have no street address.   What addresses there are look like this: "Street 19A, Community 366".   There are no street names, only numbers, usually from 1 to 30 and then starting over again with a new "Community" number.   In other words, telling someone where you live is a real hassle.   If you want a pizza delivered or need for whatever reason to identify where you live, you need to do so using landmarks, eg. "opposite the Jumeirah Hotel, two blocks down, behind the Emirates Bank."

By the way, inflation is a potential problem here.  Food costs are going up (and most food is imported - nothing grows here).  And the price of gasoline is rising: last year it was around $1 a gallon, now it stands at around $1.50-$1.80 a gallon.   (Seems cheap comparing to the USA or Europe, but in neighboring Saudi it's around $0.35 a gallon.)

I own one of FNMIX's cousins, PIMCO's Developing Local Markets PLMIX.  You might want to read M*'s analyst report about it.  PLMIX attempts to profit from currency swings, while FNMIX does not. 

El-Erian will soon be opening a new global bond fund.  That will be worth looking at, IMHO!  I'll be waiting at the door unless the entry fees are too high.

 

do you think the dollar will drop more?  I think the currency angle is a flat to a climbing dollar over the next 2 yrs.

[quote user="norbertc"]

I own one of FNMIX's cousins, PIMCO's Developing Local Markets PLMIX.  You might want to read M*'s analyst report about it.  PLMIX attempts to profit from currency swings, while FNMIX does not. 

El-Erian will soon be opening a new global bond fund.  That will be worth looking at, IMHO!  I'll be waiting at the door unless the entry fees are too high.

[/quote]

Thanks Norbert, but I am not interested in owning foreign currency.   I really don't trust anyone's ability to predict currency movements.   I prefer to own foreign-currency denominated stocks (or assets) with an inherent ability to appreciate.

 

[quote user="Chang"]

I really don't trust anyone's ability to predict currency movements.   I prefer to own foreign-currency denominated stocks (or assets) with an inherent ability to appreciate.

[/quote]

I think that PLMIX holds bonds - just denominated in the local currency.

In any case, I certainly don't trust my own ability to predict currency movements.  Have been calling a top on the Euro for over a year.  But, one day I'll be right!   The Euro may go to $2.00 first, but one day I'll be right. 

I agree with Norbert that Pimco's upcoming global bond fund, to be managed by Mohamed El-Erian (late of Harvard, previously of Pimco EM bond fund), will be "worth looking at."  Until then, the closer I get to retirement, the less risk appetite I have. To that end, I just finished studying Fidelity Convertible Securities (FCVSX) and must say I am impressed with its long-term performance, manager Thomas T. Soviero, and its lower risk profile compared to pure common stock funds. I think FCVSX is on Jim Lowell's "buy" list.