Retirement: when you're ready - retirement planning; includes mutual fund recommndations - Best Funds for Your Goals
Christopher Solmssen knows more about stock picking than most mutual fund investors, so when he extols Selected American Shares, it's worth paying heed. Solmssen is a 30-year-old stock analyst with Sun-America Asset Management, in New York City. He notes that Shelby Davis, who managed Selected from 1993 until early 1997, and Davis's son Chris, who has assumed the reins from his father, practice a "really sound, long-term philosophy of investing with a five- to ten-year horizon, not week to week like some funds." Moreover, he says" with Shelby Davis, who remains active in the fund's management, you get one of the most talented investors in the business. "Who else has a 25-year track record of outperforming the market in both bull and bear markets?" asks Solmssen.
For a fund that specializes in large, undervalued stocks, Selected American -- one of only 253 diversified U.S. stock funds to have outperformed Standard & Poor's 500-stock index last year -- is fairly aggressive. Because Solmssen probably won't be tapping his savings for at least 30 years, that makes it ideal for his IRA and for this long-term retirement portfolio. The fund invests in large, moderate-growth companies -- typically those showing earnings gains of 7% to 15% a year. The Davises try to buy at favorable prices, often when a company is out of favor, and then hold the stock for at least five to seven years. "People call us value investors because we're price sensitive, but we don't want any stock that doesn't have growth potential," says Chris, who likens himself to a quarterback and his father to the coach.
High-tech stocks are a hallmark of Harbor Capital Appreciation. Spiros "Sig" Segalas, manager since 1990, recently had about about 28% of assets in technology stocks. That weighting isn't surprising for someone who specializes in finding large, rapidly growing companies. Unlike the Davises, who consider a 15% growth rate the ceiling, Segalas picks stocks that typically deliver earnings growth of al least 15%.
Berger New Generation, a newcomer to "Best Funds," buys rapidly growing companies, too, but smaller ones than the Harbor fund would consider. By the rules of its prospectus, it can Invest in companies of any size that are capable of changing the way things are done in their sectors. But the fund has a strong small-stock bias because, says manager William Keithler, "by definition, a lot of the innovation occurs with smaller companies, and the impact on those companies, if successful, is a lot more significant." Keithler expects the earnings of the fund's holdings to soar 52% this year.
Complementing New Generation is another "Best Funds" newcomer, Westcore Small-Cap Opportunity which invests in small, undervalued companies. Varilyn Schock, who has run Small-Cap since its inception in late 1993, looks for companies that are "mispriced" but have improving business outlooks. She uses a proprietary system that ranks companies by such measures as the ratios of price to earnings, book value and cash flow, then identifies the cheapest 10% of stocks in ten different economic sectors. These candidates for inclusion in the fund get a going-over by Schock and her analysts, who study such matters as a company's products, management and regulatory issues.
Artisan international rounds out the retirement portfolio. It is coming off a mediocre year, having returned just 3.5% in 1997, slightly less than the average diversified overseas fund. Manager Mark Yockey compiled an above-average record at both Artisan and United International, by first identifying countries that provide a good environment for growth and then searching for reasonably priced growth stocks. Yockey attributes his 1997 performance to not hedging against currency fluctuations, holding lots of small-company stocks, and owning stocks listed in Hong Kong (11% of assets at midyear) and Japan (9%). By early 1998 those figures had been trimmed to 5% and 3%, respectively, with three-fourths of Artisan's assets in European stocks and about one-fifth in emerging markets, including Hong Kong.
For a fund that specializes in large, undervalued stocks, Selected American -- one of only 253 diversified U.S. stock funds to have outperformed Standard & Poor's 500-stock index last year -- is fairly aggressive. Because Solmssen probably won't be tapping his savings for at least 30 years, that makes it ideal for his IRA and for this long-term retirement portfolio. The fund invests in large, moderate-growth companies -- typically those showing earnings gains of 7% to 15% a year. The Davises try to buy at favorable prices, often when a company is out of favor, and then hold the stock for at least five to seven years. "People call us value investors because we're price sensitive, but we don't want any stock that doesn't have growth potential," says Chris, who likens himself to a quarterback and his father to the coach.
High-tech stocks are a hallmark of Harbor Capital Appreciation. Spiros "Sig" Segalas, manager since 1990, recently had about about 28% of assets in technology stocks. That weighting isn't surprising for someone who specializes in finding large, rapidly growing companies. Unlike the Davises, who consider a 15% growth rate the ceiling, Segalas picks stocks that typically deliver earnings growth of al least 15%.
Berger New Generation, a newcomer to "Best Funds," buys rapidly growing companies, too, but smaller ones than the Harbor fund would consider. By the rules of its prospectus, it can Invest in companies of any size that are capable of changing the way things are done in their sectors. But the fund has a strong small-stock bias because, says manager William Keithler, "by definition, a lot of the innovation occurs with smaller companies, and the impact on those companies, if successful, is a lot more significant." Keithler expects the earnings of the fund's holdings to soar 52% this year.
Complementing New Generation is another "Best Funds" newcomer, Westcore Small-Cap Opportunity which invests in small, undervalued companies. Varilyn Schock, who has run Small-Cap since its inception in late 1993, looks for companies that are "mispriced" but have improving business outlooks. She uses a proprietary system that ranks companies by such measures as the ratios of price to earnings, book value and cash flow, then identifies the cheapest 10% of stocks in ten different economic sectors. These candidates for inclusion in the fund get a going-over by Schock and her analysts, who study such matters as a company's products, management and regulatory issues.
Artisan international rounds out the retirement portfolio. It is coming off a mediocre year, having returned just 3.5% in 1997, slightly less than the average diversified overseas fund. Manager Mark Yockey compiled an above-average record at both Artisan and United International, by first identifying countries that provide a good environment for growth and then searching for reasonably priced growth stocks. Yockey attributes his 1997 performance to not hedging against currency fluctuations, holding lots of small-company stocks, and owning stocks listed in Hong Kong (11% of assets at midyear) and Japan (9%). By early 1998 those figures had been trimmed to 5% and 3%, respectively, with three-fourths of Artisan's assets in European stocks and about one-fifth in emerging markets, including Hong Kong.
Christopher Solmssen knows more about stock picking than most mutual fund investors, so when he extols Selected American Shares, it's worth paying heed. Solmssen is a 30-year-old stock analyst with Sun-America Asset Management, in New York City. He notes that Shelby Davis, who managed Selected from 1993 until early 1997, and Davis's son Chris, who has assumed the reins from his father, practice a "really sound, long-term philosophy of investing with a five- to ten-year horizon, not week to week like some funds." Moreover, he says" with Shelby Davis, who remains active in the fund's management, you get one of the most talented investors in the business. "Who else has a 25-year track record of outperforming the market in both bull and bear markets?" asks Solmssen.
For a fund that specializes in large, undervalued stocks, Selected American -- one of only 253 diversified U.S. stock funds to have outperformed Standard & Poor's 500-stock index last year -- is fairly aggressive. Because Solmssen probably won't be tapping his savings for at least 30 years, that makes it ideal for his IRA and for this long-term retirement portfolio. The fund invests in large, moderate-growth companies -- typically those showing earnings gains of 7% to 15% a year. The Davises try to buy at favorable prices, often when a company is out of favor, and then hold the stock for at least five to seven years. "People call us value investors because we're price sensitive, but we don't want any stock that doesn't have growth potential," says Chris, who likens himself to a quarterback and his father to the coach.
High-tech stocks are a hallmark of Harbor Capital Appreciation. Spiros "Sig" Segalas, manager since 1990, recently had about about 28% of assets in technology stocks. That weighting isn't surprising for someone who specializes in finding large, rapidly growing companies. Unlike the Davises, who consider a 15% growth rate the ceiling, Segalas picks stocks that typically deliver earnings growth of al least 15%.
Berger New Generation, a newcomer to "Best Funds," buys rapidly growing companies, too, but smaller ones than the Harbor fund would consider. By the rules of its prospectus, it can Invest in companies of any size that are capable of changing the way things are done in their sectors. But the fund has a strong small-stock bias because, says manager William Keithler, "by definition, a lot of the innovation occurs with smaller companies, and the impact on those companies, if successful, is a lot more significant." Keithler expects the earnings of the fund's holdings to soar 52% this year.
Complementing New Generation is another "Best Funds" newcomer, Westcore Small-Cap Opportunity which invests in small, undervalued companies. Varilyn Schock, who has run Small-Cap since its inception in late 1993, looks for companies that are "mispriced" but have improving business outlooks. She uses a proprietary system that ranks companies by such measures as the ratios of price to earnings, book value and cash flow, then identifies the cheapest 10% of stocks in ten different economic sectors. These candidates for inclusion in the fund get a going-over by Schock and her analysts, who study such matters as a company's products, management and regulatory issues.
Artisan international rounds out the retirement portfolio. It is coming off a mediocre year, having returned just 3.5% in 1997, slightly less than the average diversified overseas fund. Manager Mark Yockey compiled an above-average record at both Artisan and United International, by first identifying countries that provide a good environment for growth and then searching for reasonably priced growth stocks. Yockey attributes his 1997 performance to not hedging against currency fluctuations, holding lots of small-company stocks, and owning stocks listed in Hong Kong (11% of assets at midyear) and Japan (9%). By early 1998 those figures had been trimmed to 5% and 3%, respectively, with three-fourths of Artisan's assets in European stocks and about one-fifth in emerging markets, including Hong Kong.
For a fund that specializes in large, undervalued stocks, Selected American -- one of only 253 diversified U.S. stock funds to have outperformed Standard & Poor's 500-stock index last year -- is fairly aggressive. Because Solmssen probably won't be tapping his savings for at least 30 years, that makes it ideal for his IRA and for this long-term retirement portfolio. The fund invests in large, moderate-growth companies -- typically those showing earnings gains of 7% to 15% a year. The Davises try to buy at favorable prices, often when a company is out of favor, and then hold the stock for at least five to seven years. "People call us value investors because we're price sensitive, but we don't want any stock that doesn't have growth potential," says Chris, who likens himself to a quarterback and his father to the coach.
High-tech stocks are a hallmark of Harbor Capital Appreciation. Spiros "Sig" Segalas, manager since 1990, recently had about about 28% of assets in technology stocks. That weighting isn't surprising for someone who specializes in finding large, rapidly growing companies. Unlike the Davises, who consider a 15% growth rate the ceiling, Segalas picks stocks that typically deliver earnings growth of al least 15%.
Berger New Generation, a newcomer to "Best Funds," buys rapidly growing companies, too, but smaller ones than the Harbor fund would consider. By the rules of its prospectus, it can Invest in companies of any size that are capable of changing the way things are done in their sectors. But the fund has a strong small-stock bias because, says manager William Keithler, "by definition, a lot of the innovation occurs with smaller companies, and the impact on those companies, if successful, is a lot more significant." Keithler expects the earnings of the fund's holdings to soar 52% this year.
Complementing New Generation is another "Best Funds" newcomer, Westcore Small-Cap Opportunity which invests in small, undervalued companies. Varilyn Schock, who has run Small-Cap since its inception in late 1993, looks for companies that are "mispriced" but have improving business outlooks. She uses a proprietary system that ranks companies by such measures as the ratios of price to earnings, book value and cash flow, then identifies the cheapest 10% of stocks in ten different economic sectors. These candidates for inclusion in the fund get a going-over by Schock and her analysts, who study such matters as a company's products, management and regulatory issues.
Artisan international rounds out the retirement portfolio. It is coming off a mediocre year, having returned just 3.5% in 1997, slightly less than the average diversified overseas fund. Manager Mark Yockey compiled an above-average record at both Artisan and United International, by first identifying countries that provide a good environment for growth and then searching for reasonably priced growth stocks. Yockey attributes his 1997 performance to not hedging against currency fluctuations, holding lots of small-company stocks, and owning stocks listed in Hong Kong (11% of assets at midyear) and Japan (9%). By early 1998 those figures had been trimmed to 5% and 3%, respectively, with three-fourths of Artisan's assets in European stocks and about one-fifth in emerging markets, including Hong Kong.
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