Downgrades
BlackRock Gold and General A Inc – Silver
BGF World Gold – Silver
Fatima Khizou
Evy Hambro took the helm in April 2009 but his involvement with the strategy dates further back, making him one of the longest-tenured managers in the sector. He has consistently applied a disciplined and controlled approach through time that has proven successful in tough periods for gold but added little value in more positive environments.
While we continue to have high regard for lead manager Hambro and the overall supporting cast, we believe that the lower-beta approach and a policy of only making incremental change, a feature of the fund, constitute a hindrance in strong rising market conditions. These factors, coupled with high fees, have lowered our overall conviction in this fund and as a result we have downgraded the fund’s Morningstar Analyst Rating to Silver from Gold.
GAM Multistock Luxury Brands Equity - Bronze
Fatima Khizou
We continue to think highly of GAM Multistock Luxury Brands Equity’s management duo. Its expertise in the luxury-goods sector, coupled with a sound and long-term investment approach, has served investors well over the long haul. However, we note that the fund’s ongoing charges on its clean share class relative to those of similarly run equity funds, both active and passive, rank on the higher end, giving it a greater hurdle to overcome in the future. As a result, the fund’s Morningstar Analyst Rating is downgraded to Bronze from Silver, reflecting our lower level of conviction in the fund's ability to outperform over the long term.
New Ratings
PGIM Global Total Return Bond – Silver
Mara Dobrescu
We have initiated coverage of PGIM Global Total Return Bond with a Morningstar Analyst Rating of Silver. The strategy benefits from Prudential’s large investments in people and analytics, and portfolio managers Michael J. Collins, Robert Tipp, and Arvind Rajan have built a strong long-term track record through a wide range of performance drivers. The fund also carries a modest price tag, which adds to its competitiveness in the Global Flexible Bond Morningstar Category.