David Herro on CNBC’s “Closing Bell” (03.10.20)

March 10, 2020

Portfolio Manager David Herro discussed why volatility may create opportunity for value investors while on CNBC’s “Closing Bell.”

The holdings mentioned comprise the following percentages of the Fund’s total net assets as of 12/31/2019:

Security Title Oakmark International Fund Oakmark Global Fund Oakmark Global Select Fund Oakmark International Small Cap Fund
American Airlines0%0%0%0%
Bank of America0%4.8%7.1% 0%
BNP Paribas3.7%0%0% 0%
Citigroup0%3.6%5.6% 0%
Credit Suisse Group3.5%4.2%6.5% 0%
Delta Air Lines0%0%0% 0%
Ford Motor Co.0%0%0% 0%
Glencore4.3%0%0% 0%
General Motors0%3.8%0% 0%
Goldman Sachs0%0%0% 0%
JP Morgan0%0%0% 0%
Morgan Stanley0%0%0% 0%
Ryanair Holdings ADR2.9%3.2%0% 0%
Southwest Airlines0%1.4%0% 0%
Tesla0%0%0% 0%
Toyota Motor1.5%1.6%0% 0%
Trip.com0.3%0%0% 0%
United Airlines0%0% 0% 0%
Wells Fargo0%0%0% 0%

Portfolio holdings are subject to change and are not intended as recommendations of individual stocks. Individual security weights may not add to the displayed total due to rounding.

Access the full list of holdings for the Oakmark International Fund as of the most recent quarter-end.

Access the full list of holdings for the Oakmark Global Fund as of the most recent quarter-end.

Access the full list of holdings for the Oakmark Global Select Fund as of the most recent quarter-end.

Access the full list of holdings for the Oakmark International Small Cap Fund as of the most recent quarter-end.

The Oakmark Funds’ portfolios tend to be invested in a relatively small number of stocks. As a result, the appreciation or depreciation of any one security held by the Fund will have a greater impact on the Funds’ net asset value than it would if the Fund invested in a larger number of securities. Although that strategy has the potential to generate attractive returns over time, it also increases the Funds’ volatility.

Because the Oakmark Global Select Fund is non-diversified, the performance of each holding will have a greater impact on the Fund’s total return, and may make the Fund’s returns more volatile than a more diversified fund.

Investing in foreign securities presents risks that in some ways may be greater than U.S. investments. Those risks include: currency fluctuation; different regulation, accounting standards, trading practices and levels of available information; generally higher transaction costs; and political risks.

The stocks of smaller companies often involve more risk than the stocks of larger companies. Stocks of small companies tend to be more volatile and have a smaller public market than stocks of larger companies. Small companies may have a shorter history of operations than larger companies, may not have as great an ability to raise additional capital and may have a less diversified product line, making them more susceptible to market pressure.

According to Morningstar, the Morningstar Manager of the Year award is presented to portfolio managers based on the managers’ (i) “ability to generate exceptional returns;” (ii) “willingness to align their interests with shareholders;” and (iii) “courage to stay with their strategies in order to produce superior risk-adjusted returns in the end.

According to Morningstar, the Fund Manager of the Decade award, which is a new award from Morningstar, recognizes fund managers who have achieved superior risk-adjusted results over the past 10 years and have an established record of serving shareholders well. While the awards focus on performance over the past decade, Morningstar takes into consideration other factors, including the fund manager’s strategy, approach to risk, size of the fund, and stewardship. Both individual fund managers and management teams are eligible, and being a previous winner of the Morningstar Fund Manager of the Year award isn’t a prerequisite. Morningstar’s fund analysts select the Fund Manager of the Decade award winners based on Morningstar’s proprietary research and in-depth evaluation.

The discussion of the Fund’s investments and investment strategy (including current investment themes, the portfolio managers’ research and investment process, and portfolio characteristics) represents the Fund’s investments and the views of the portfolio managers and Harris Associates L.P., the Fund’s investment adviser, at the time of this publication, and are subject to change without notice.