ARTIX: How Is 2016 Looking so Far for the Fund?

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The Artisan International Fund’s composition

The Artisan International Fund – Investor Class (ARTIX) has been in existence since December 1995. At the end of January 2016, the fund was managing assets worth $16.9 billion and these were spread across 71 holdings as of the end of January 2016.

Healthcare stocks formed 23.5% of the fund’s assets and made up the largest sector of investment as of the end of January. The consumer discretionary and consumer staples sectors followed, forming a combined 32% of the portfolio. The fund was not invested in the energy sector. 55.5% of the fund’s assets were invested in European equities, followed by 21.1% in the Americas.

Medtronic (MDT) was the fund’s single largest holding, forming 5.3% of the fund’s January 2016 assets. Bayer (BAYZF), Roche Holding (RHHBY), TE Connectivity (TEL), and Infosys (INFY) formed a combined 8.8% of the fund’s assets.

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Returns of the Artisan International Fund

The Investor Class shares of the Artisan International Fund (ARTIX) had a forgettable year up until January 2016. From a purely NAV (net asset value) return standpoint, the ARTIX stood last among the nine funds in this review in both the aforementioned period and 2015.

Standard deviation

Standard deviation is used for assessing risks associated with an investment. Simply put, it measures the deviation of a series of returns from the average. A wide deviation reflects a high fluctuation in the returns, resulting in a higher risk, and vice versa.

For the one-year period ended January 2016, the standard deviation for the ARTIX stood at 15.1%. Meanwhile, the arithmetic average of the standard deviation of all funds in this review was 14.5%. Excluding the ARTIX, the average was 14.4%. Therefore, the returns of the fund were much more volatile than the average return of the peer group.

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Sharpe ratio

For realized returns, the Sharpe ratio assesses the average return on a risk-free asset or security over total risk as represented by a standard deviation. The higher the Sharpe Ratio, the better the risk-adjusted performance.

The Sharpe ratio for the ARTIX for the one-year period ended January 2016 stood at -0.77, whereas it was -0.21 in 2015. This makes it one of only two funds to have reported a negative ratio for 2015.

A note for investors

Apart from high volatility of its returns, the ARTIX also witnessed a poor performance, which resulted in a poor risk-adjusted performance. Things haven’t been much different in 2016 so far. Though it was not the worst performer in January 2016, the returns have stayed at the bottom of the pack and remain volatile. Investors would do well to evaluate other investment options among this category of funds before investing their hard-earned money. Let’s move to the next fund in this review: the Fidelity Advisor International Discovery Fund – Class A (FAIDX).

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