Asset Types not matching M* data?

[jstolzen]

Hi, Mark..

I'm attempting to update the Asset types on all funds in my portfolio, and for some reason the detail breakdown (eg: across cash, large/value, large/growth, FI) is not matching what's on the M* pages..

For example - BERIX (Berwyn Income Fund)..M* shows 26% cash, 12.98% US Stock, 44.55% bond, etc on http://portfolios.morningstar.com/fund/summary?t=BERIX, but after updating asset types, FM has BERIX at 0% cash, 30% US Stock and 70% FI: Low-Limited.

Another thing I noticed is that International funds don't seem to always update correctly..eg: OAKIX was way off and I had to update the asset split manually and select the check-box to say not to update on asset retrieval..but it'd be good if it could grab the correct data also since the portfolio will change time to time..

Any idea what might be happening? I was really happy to see that FM can do Asset type updates as I used to enter these all by hand in a spreadsheet (which was a ton of work looking up every fund in M*), but for whatever reason it does not seem that the #s are syncing up for some reason..

Thx..

[Mark]

Hi jstolzen,

In your BERIX example, that is a mixed fund, part equity, and part fixed income. The numbers you showed are not the asset types. Those are the investment types. Fund Manager uses those though for mixed fund cases. It adds up the cash/bond percentages, and then applies the "Bond Style" asset types to that percentage. Notice Morningstar has both a "Equity Style" and "Bond Style" tab. So, the (cash + bond) percentage is applied to the Bond Style asset type, which is all "FI: Low-Limited". The remaining percentage of the other investment types (stocks/other) are applied to the "Equity Style" asset types (Large/Mid/Small - Value/Core/Growth). The numbers are rounded at the end to get everything to be an integer, and add up to 100. So, in this case you end up with 70 for the "FI: Low-Limited" since you have about 70% cash/bond and the bond style is "FI: Low-Limited". The remaining 30% is allocated to the "Equity Style" asset types, so you end up with 7% Small Value for example. Morningstar shows 22% of the equity percent is Small Value, but the overall percent is 22% * 30%, so it comes out to 7%.

I tested OAKIX and it retrieved properly, matching what was shown on Morningstar. Make sure you have the investment set to the correct investment "Type" (stock, fund, etc) under "Investment Properties... / General" as that controls how the asset types are retrieved. If you're still experiencing issues, please let me know.

[jstolzen]

Hi, Mark. Thanks much for the very quick reply..

Makes sense..I wasn't aware you adding cash + bond percentages together before applying to Bond style. For some reason I was also thinking FM'd also looks at the "Bond Sector" data on the M* FI page for the fund to determine % each in Corporates, Government, Muni, etc - but guessing that's not actually how it works and it's just using the style box (which in the case of BERIX is LTD-Low and calculating off of that. Is that right?) I know Sector is not Type, but a lot of AA approaches like Bernstein describes as well as others like the portfolio backtesting tools break things out that way in terms of their AA so it'd be awesome if FM some day included that capability.

What's the difference (to FM) between asset type and investment type? The #s I was posting on BERIX came from the "Asset Allocation" area on the M* page for the fund, but if I follow you're saying these are investment and not asset types?

Been using FM for a while now (really nice job BTW..I'm originally a software developer by profession and have worked in IT for 30+ years now, so can really appreciate what goes into creating such a well written app that just works intuitively and how you expect it to), but I don't remember what Asset categories I may have added during the time I've been using it, and what was provided OOTB.

On OAKIX, I guess I was expecting FM would split between International and US (using the "US Stock" and "non-US stock" #s from the M* asset allocation area), and then break those #s down by Lg-Val, Lg-Core, etc - but I may have added my own Int:Lg-Val, Int:Lg-Core, etc. categories at one point - don't recall. So, is it that FM will put everything into the 9 M* equity boxes (eg: Lg-Val, Lg-Core) regardless of whether a fund holds non-US stocks and not break out US vs International?

If you decide at some point to add to what FM does on Asset allocation, I'd love to provide some input and "wish list" items..AA is an area I focus a lot on and I'm always looking for easier ways to net things out in terms of US vs. International, Bond Sectors (Munis vs. Corporates and Gov FI), etc. Today I use an Excel sheet with a lot of VBA code I developed, but it's a ton of work to maintain..be awesome if FM does all that some day.

Thanks for the great app. It's the best I've found for managing a pretty complex portfolio. Blows Quicken and all the online tools absolutely out of the water.

[Mark]

Hi jstolzen,

What's the difference (to FM) between asset type and investment type?

Investment type is Stock/Bond/Fund/ETF etc, and is set under "Investment Properties... / General". Asset Type is one of the categories, and is set under "Investment Properties... / Asset Type" tab. They are both just different ways of analyzing your investments. You can graph/report by either of these, as well as the other categories. You might want to watch our Categories Tutorial.

it's just using the style box

So, is it that FM will put everything into the 9 M* equity boxes (eg: Lg-Val, Lg-Core) regardless of whether a fund holds non-US stocks and not break out US vs International?

Yes, FM is just using those style boxes. When there are both equity and bond styles, it splits up the allocation based on the percentage of "cash + bond" being assigned to the bond style, and the remainder to the equity style box.

Thanks for the nice compliments on the program, glad you've found it useful.