The Long View
The Long View
Jan 8, 2020
John Rekenthaler: Fund Manager Financial Incentives Are Irrelevant
52 min

Our guest this week is John Rekenthaler. Rekenthaler is a director in Morningstar Research Services and a feature contributor to our platforms, including Morningstar.com. A lucid thinker and brilliant writer, his popular "Rekenthaler Report" column has become a must read among investors, financial advisors, fund industry participants, and beyond.

Rekenthaler began his career at Morningstar in 1988 and has worn a number of hats, including leadership roles in our research and investment management divisions. Among other achievements, Rekenthaler has been a key player in developing some of Morningstar's best-known tools, including the Morningstar Rating for funds and the Morningstar Style Box. He holds a bachelor's degree in English from the University of Pennsylvania and a master's degree in business administration from the University of Chicago Graduate School of Business.

Background

The Rekenthaler Report

Morningstar Rating for funds methodology

Morningstar Style Box methodology

Investor Behavior 

Morningstar's Mind the Gap study

Rekenthaler Report: "Mutual Funds: Where Fun Came to Die"

Rekenthaler Report: "3 Reasons Index Investors Deserve Perdition (or Not)"

Rekenthaler Report: "Up-Front Investment Fees Are (Almost) No More"

Incentives

Rekenthaler Report: "Give Performance Fees a Chance"

How John Invests

Rekenthaler Report: "What's in My Portfolio?"

Most and Least Popular Columns

Rekenthaler Report: "Enough with Revenue Sharing!"

Rekenthaler Report: "About that Rigging Claim"

Flash Boys: A Wall Street Revolt, by Michael Lewis, March 2014.

Compelling Academic Research

Rekenthaler Report: "Predicting Mutual Fund Returns With the Ownership Lens"

"Judging Fund Managers by the Company They Keep," by Randolph Cohen, Joshua Coval, and Lubos Pastor; NBER Working Paper No. 9359, December 2002.

The State of Retirement

Rekenthaler Report: "The Retirement Crisis That Isn't?"

Teresa Ghilarducci

"A Perplexing Tale About 401(k)s," by Scott Cooley; Morningstar.com, Nov. 26, 2015.

Rekenthaler Report: "The British Show How to Improve 401(k)s"

Best and Worst Innovations

Rekenthaler Report: "Why ETFs Succeeded for Retail Investors"

Rekenthaler Report: "Tactical-Allocation Funds: Even Worse Than Expected"

Jack Bogle

Rekenthaler Report: "Jack Bogle Strikes Back!"

Rekenthaler Report: "Jack Bogle's (Somewhat) Accidental Legacy"

Corporate Governance

"Anticompetitive Effects of Common Ownership," by Jose Azar, Martin Schmalz, and Isabel Tecu; Journal of Finance, May 2018.

Rekenthaler Report: "Are Index Funds Too Soft on CEOs?"

Rekenthaler Report: "The Latest Salvo Against Indexing"

Rekenthaler Report: "The Doctrine of Shareholder Value Has Indeed Helped Shareholders"

Albert J. "Chainsaw Al" Dunlap  bio

What John Reads

Berkshire Hathaway shareholder letters

Joe Mansueto bio

Reflections on Investing

Rekenthaler Report: "My Investment Howler"

Bogleheads On Investing Podcast
Bogleheads On Investing Podcast
bogleheads
Episode 027: Cliff Asness, host Rick Ferri
Dr. Cliff Asness is a Founder, Managing Principal, and Chief Investment Officer at AQR Capital Management, a quantitative money manager overseeing $186 billion in assets as of December 2019. Prior to co-founding AQR Capital Management, he was a Managing Director and Director of Quantitative Research for the Asset Management Division of Goldman, Sachs & Co. He is an award-winning researcher on quantitative investment strategies and has authored articles for many publications, including The Journal of Portfolio Management, Financial Analysts Journal, The Journal of Finance, and The Journal of Financial Economics. Cliff received a B.S. in economics from the Wharton School and a B.S. in engineering from the Moore School of Electrical Engineering at the University of Pennsylvania, graduating summa cum laude in both. He received an M.B.A. with high honors and a Ph.D. in finance from the University of Chicago, where he was Eugene Fama’s student and teaching assistant for two years. This podcast is hosted by Rick Ferri, CFA, a long-time Boglehead and investment adviser. The Bogleheads are a group of like-minded individual investors who follow the general investment and business beliefs of John C. Bogle, founder and former CEO of the Vanguard Group. It is a conflict-free community where individual investors reach out and provide education, assistance, and relevant information to other investors of all experience levels at no cost. The organization's free website is Bogleheads.org and the wiki site is Bogleheads® wiki. Bogleheads sites are operated by volunteers who contribute time and talent. Donations help defray operating costs. Since 2000, the Bogleheads' have held national conferences in major cities around the country and currently meet in Philadelphia in the autumn of each year. There are 56 Local Chapters in the US and three Foreign Chapters that also meet regularly. New Chapters are being added on a regular basis. This podcast is supported by the John C. Bogle Center for Financial Literacy, a non-profit organization approved by the IRS as a 501(c)(3) public charity on February 6, 2012.
59 min
WEALTHTRACK
WEALTHTRACK
Consuelo Mack
Successful Investing: Timeless Advice
Can investing be simple? Can we stop worrying about what’s happening on Wall Street, in Washington, with Fed policy, inflation, corporate earnings, and numerous other headline-making concerns? Can we just get on with our lives and still invest successfully?  According to this week’s guest, the answer is yes, and we shouldn’t even care what the market is doing.   What should we care about? How should we invest? That is the focus of this week’s exclusive WEALTHTRACK interview.   Our guest is Charles Ellis, the author of the investment classic WINNING THE LOSER’S GAME, available now in its 2017 7th edition. Ellis is the author of 16 other books including the recently published 10th-anniversary edition of THE ELEMENTS OF INVESTING, co-written with his good friend, Princeton economics professor Burton Malkiel.    Ellis is a globally recognized financial thought leader, investment consultant, and advisor to governments, institutions, and endowments. He also cares deeply about helping investors succeed, as he puts it “winning the loser’s game.” He will help us do that this week.  WEALTHTRACK #1721 broadcast on November 20, 2020 More info: https://wealthtrack.com/timeless-strategies-for-successful-investing-from-legendary-investment-consultant-charles-ellis/ WINNING THE LOSER’S GAME (2017 edition): https://amzn.to/379ODOP THE ELEMENTS OF INVESTING: https://amzn.to/2UL96Dz --- Support this podcast: https://anchor.fm/wealthtrack/support
26 min
Marketplace Roundtable
Marketplace Roundtable
Seeking Alpha
The Value Investor's Edge Live #22: Time To Bet Heavily On Energy With J Mintzmyer and Michael Boyd
Michael Boyd, Head of Research at Energy Income Authority, joined J Mintzmyer's Value Investor's Edge Live on November 6, 2020, to discuss the post-election energy market prospects and opportunities into 2021 and beyond. This interview and discussion is relevant for anyone with interest in the broad energy sectors, including the overall SPDR Energy ETF (XLE) and income-focused funds such as the Alerian (AMLP). Specifically in this interview, we discuss several individual names including Altus Midstream (ALTM), Calumet Specialty Products (CLMT), Cimarex Energy (XEC), DCP Midstream (DCP), Diamondback Energy (FANG), Energy Transfer (ET), ExxonMobil (XOM), Plains All American (PAA), RPC Inc (RES), Schlumberger (SLB), and Targa Resources (TRGP). Topics Covered (<3:15) Intro/Disclosures (3:30) What does Biden Presidency and GOP Senate mean for energy? (6:30) Any risk to an energy export ban/shift? (8:30) Discussion on valuation levels and approaches. (18:00) What are your favorite sectors vs. avoids? (25:00) Top picks and a short candidate ideas to hedge? (32:45) You're negative on oil services: what about Schlumberger (SLB)? (35:45) Any views on ExxonMobil (XOM)? Are they attractive here? (39:15) Updated commentary on Altus Midstream (ALTM) after the triple? (46:45) Any firms which could be the ‘next ALTM?’ (51:15) Any top picks without K-1 exposure? (53:30) How will the divestment wave play out? Interest in crude oil itself? (1:00:30) Overview of the Energy Income Authority research platform. Learn more about your ad choices. Visit megaphone.fm/adchoices
1 hr 6 min
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