Herro Looking to the Market’s Unloved

Top fund manager David Herro is high on a number of unloved areas of the market — including Japanese stocks, luxury good makers, and much-maligned automaker Toyota. “One of the secrets, I think, to successful long-term investing is to really look for where the true values are,” Herro, Morningstar’s domestic fund manager of the decade, tells Bloomberg. “And where the true values are usually is where the momentum is not.” Herro also explains why he has underweighted the popular BRIC nations. [youtube=http://www.youtube.com/watch?v=Zbf1gREgKBM]

Herro: Stocks Still Cheap

David Herro, who was recently named one of Morningstar’s fund managers of the decade, says stocks are still cheap — especially compared to other asset classes. Herro says that during most downturns, his portfolios’ prices fall to about 50% of their underlying values. In the recent downturn, they fell to about 35%, he says, and after the recent rally, they’re trading in the mid-50% range — still near the levels typically seen in normal downturns. Also make sure to check out Herro’s explanation of how he goes about finding value in stocks.

Herro Still High on Some Financials

David Herro, who was recently named one of Morningstar’s fund managers of the decade, likes several financial stocks right now. Herro tells Bloomberg that he’s particularly high on asset management businesses, which he says get hit hard in downturns but over the long run are good businesses. Herro also says Japanese markets are starting to look attractive. [youtube=http://www.youtube.com/watch?v=Wwy1K1Htetc]

More Fund Managers Snatching Up Bargains

Money has been flowing out of mutual funds at an incredible rate in the past year, but three well-known fund managers see opportunity in the flight from stocks, BusinessWeek’s Tara Kalwarski writes. Kalwarski interviewed John Rogers of Ariel Fund, David Herro of Oakmark International Fund, and Tom Marsico of Marsico Focus Fund, and found that all are responding to big losses last year by doing quite a bit of bargain hunting right now. Rogers’ fund is worth half of what it was a year ago, but he has a track record of emerging strong from crises; in the year after […]