Harris Associates L.P. Announces Launch of Oakmark U.S. Large Cap ETF

Rhea-AI Summary

Harris Associates L.P. has launched its first ETF, the Oakmark U.S. Large Cap ETF (NYSE: OAKM), an active, fully transparent ETF focused on long-term capital appreciation through investments in large U.S. companies. The fund is managed by Bill Nygren, Robert Bierig, and Michael Nicolas, who also manage the Oakmark Fund.

OAKM employs a value investment philosophy, targeting quality companies trading at discounts to their intrinsic value. The ETF maintains a focused portfolio of typically 30-40 U.S. large-cap companies and is unconstrained by sector. The fund aims to combine Harris|Oakmark's value investing experience with ETF benefits including transparency, intra-day liquidity, and potential tax-efficient investing.

Positive

• First ETF offering from established value investment firm Harris Associates
• Experienced management team with proven track record
• Focused portfolio strategy with 30-40 holdings indicating high-conviction approach
• Tax-efficient investment structure through ETF format

Negative

• Concentrated portfolio of 30-40 holdings may increase individual stock risk
• New ETF with no established performance history

Insights

Financial Analyst

The launch of Oakmark's first ETF represents a significant strategic move in the evolving asset management landscape. This actively managed ETF enters a competitive market where passive funds dominate, but brings Harris|Oakmark's established value investing approach to a new vehicle format. The ETF's concentrated portfolio of 30-40 holdings indicates a high-conviction strategy, which differentiates it from index-based competitors.

The management team's track record, particularly Bill Nygren's tenure since 1983 and his Morningstar recognition, adds credibility to this offering. The ETF structure offers several advantages over traditional mutual funds, including potentially lower costs, better tax efficiency through in-kind creation/redemption and intraday trading flexibility.

While this launch expands Harris|Oakmark's product lineup, investors should note that value investing strategies have faced challenges in recent years against growth-focused approaches. The success of this ETF will largely depend on market conditions and the team's ability to identify undervalued large-cap opportunities.

CHICAGO, Dec. 3, 2024 /PRNewswire/ -- Harris Associates L.P. (Harris|Oakmark), adviser to the Oakmark U.S. Large Cap ETF (NYSE: OAKM), and an affiliate of Natixis Investment Managers, announced the launch of OAKM. OAKM is an active, fully transparent ETF that seeks long-term capital appreciation by investing in a diversified portfolio of common stocks of larger U.S. companies and is the first ETF offered by Harris|Oakmark.

The Oakmark U.S. Large Cap ETF is managed by Bill Nygren, Robert Bierig and Michael Nicolas, all of whom also manage the Oakmark Fund. The ETF employs the firm's consistent value investment philosophy to identify quality companies priced at a discount to the management team's estimate of intrinsic value. OAKM, unconstrained by sector and holding typically 30 to 40 U.S. large-cap companies, seeks competitive long-term performance by investing in a focused portfolio grounded in disciplined, bottom-up research.

"We are excited to offer our value-based approach to long-term investing for clients who prefer the convenience of ETFs," said Bill Nygren.

Mr. Nygren joined Harris|Oakmark in 1983 and is also a co-portfolio manager of the Oakmark Select Fund. He has received many accolades during his investment career, including being named Morningstar's Domestic Stock Manager of the Year in 2001.* Mr. Bierig joined Harris|Oakmark in 2012 and is also the co-portfolio manager of the Oakmark Select Fund. Mr. Nicolas joined Harris|Oakmark in 2013 and is also a co-portfolio manager of the Oakmark Equity and Income Fund.

"OAKM combines our value investing experience with the benefits of an active ETF, such as transparency, intra-day liquidity and the potential for tax-efficient investing," said Robert Bierig and Michael Nicolas.

Learn more about OAKM at www.oakmark.com/OAKM.

*According to Morningstar, the Morningstar Manager of the Year award is presented to portfolio managers based on the managers' (i) "ability to generate exceptional returns;" (ii) "willingness to align their interests with shareholders;" and (iii) "courage to stay with their strategies in order to produce superior risk-adjusted returns in the end."

About Harris Associates L.P.
Harris Associates L.P., a Chicago-based investment management firm founded in 1976, serves as the adviser to the Funds. Harris Associates also manages U.S., international and global portfolios for institutional and high-net-worth investors worldwide. Assets under management and advisement at Harris Associates totaled approximately $104 billion as of September 30, 2024. More information about Harris Associates is available at harrisassoc.com.

About Natixis Investment Managers
Natixis Investment Managers' multi-affiliate approach connects clients to the independent thinking and focused expertise of more than 15 active managers. Ranked among the world's largest asset managers¹ with more than $1.4 trillion assets under management² (€1.2 trillion), Natixis Investment Managers delivers a diverse range of solutions across asset classes, styles, and vehicles, including innovative environmental, social, and governance (ESG) strategies and products dedicated to advancing sustainable finance. The firm partners with clients in order to understand their unique needs and provide insights and investment solutions tailored to their long-term goals. Headquartered in Paris and Boston, Natixis Investment Managers is part of the Global Financial Services division of Groupe BPCE, the second-largest banking group in France through the Banque Populaire and Caisse d'Epargne retail networks. Additionally, investment solutions are offered through Natixis Investment Managers Solutions and Natixis Advisors, LLC. For additional information, please visit Natixis Investment Managers' website at im.natixis.com | LinkedIn: linkedin.com/company/natixis-investment-managers.

¹ Survey respondents ranked by Investment & Pensions Europe/Top 500 Asset Managers 2024 ranked Natixis Investment Managers as the 19^th largest asset manager in the world based on assets under management as of December 31, 2023.

² Assets under management (AUM) of current affiliated entities measured as of September 30, 2024, are $1,427.2 billion (€1,279.0 billion). AUM, as reported, may include notional assets, assets serviced, gross assets, assets of minority-owned affiliated entities and other types of nonregulatory AUM managed or serviced by firms affiliated with Natixis Investment Managers.

Understanding the Risks

Oakmark U.S. Large Cap ETF (OAKM) / Investing involves risk; principal loss is possible. There is no guarantee the Fund's investment objective will be achieved. The Fund is actively managed and does not seek to replicate a specific index. Exchange-Traded Fund (ETFs) are subject to additional risks that do not apply to conventional mutual funds, including the risks that the market price of ETF's shares may trade at a premium or discount to its net asset value (NAV), an active secondary trading market may not develop or be maintained, or trading may be halted by the exchange in which they trade, which may impact an ETF's ability to sell its shares. Unlike mutual funds, ETF shares are bought and sold at market price, which may be higher or lower than their NAV, and are not individually redeemed from the fund. Brokerage commissions will reduce returns. The Fund invests primarily in large capitalization securities, which may be unable to respond quickly to new competitive challenges or opportunities, attain the high growth rate of successful smaller companies, or be out of favor under certain market conditions. The Fund tends to be invested in a relatively focused portfolio of securities, thus the appreciation or depreciation of any one security held will have a greater impact on the Fund's net asset value versus investing in a larger number of securities. Common stocks are subject to special risks. As the Fund is new, there is a limited operating history and there can be no assurance it will grow to an economically viable size, in which case it may cease operations and require investors to liquidate or transfer their investments. These and other risk considerations, such as market, sector or industry, large shareholder, and value style, are described in detail in the Fund's prospectus.

Oakmark Fund / Tends to be invested in a relatively small number of securities. As a result, the appreciation or depreciation of any one security held will have a greater impact on the net asset value than it would invested in a larger number of securities. Although that strategy has the potential to generate attractive returns over time, it also increases the volatility.

Oakmark Select Fund / Because the Oakmark Select Fund is non-diversified, the performance of each holding will have a greater impact on total return and may make returns more volatile than a more diversified fund. The stocks of medium-sized companies tend to be more volatile than those of large companies and have underperformed the stocks of small and large companies during some periods.

Oakmark Equity and Income Fund / Invests in medium- and lower quality debt securities that have higher yield potential but present greater investment and credit risk than higher quality securities, which may result in greater share price volatility. An economic downturn could severely disrupt the market in medium or lower grade debt securities and adversely affect the value of outstanding bonds and the ability of the issuers to repay principal and interest. The stocks of medium-sized companies tend to be more volatile than those of large companies and have underperformed the stocks of small and large companies during some periods.

Before investing, carefully consider fund investment objectives, risks, charges and other expenses. For this and other information that should be read carefully, please request a prospectus and summary prospectus by calling 1-800-OAKMARK (625-6275) (mutual funds) or 1-800-458-7452 (ETF) or visiting oakmark.com.

Harris Associates L.P. is the Fund's investment adviser. The Oakmark ETFs are distributed by Foreside Fund Services, LLC. Harris Associates L.P. and Harris Associates Securities L.P. are not affiliated with Foreside Fund Services, LLC.

Natixis Distribution, LLC (Member FINRA | SIPC), is a marketing agent for the Oakmark Funds and Oakmark ETF.

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SOURCE Harris Associates L.P.

FAQ

What is the investment strategy of Oakmark U.S. Large Cap ETF (OAKM)?

OAKM is an active, fully transparent ETF that seeks long-term capital appreciation by investing in 30-40 U.S. large-cap companies using a value investment approach, targeting quality companies trading at discounts to their intrinsic value.

Who manages the Oakmark U.S. Large Cap ETF (OAKM)?

OAKM is managed by Bill Nygren, Robert Bierig, and Michael Nicolas, who also manage the Oakmark Fund. Bill Nygren was named Morningstar's Domestic Stock Manager of the Year in 2001.

What are the key features of the Oakmark U.S. Large Cap ETF (OAKM)?

OAKM offers transparency, intra-day liquidity, potential tax-efficient investing, and a focused portfolio of 30-40 U.S. large-cap companies. The ETF is unconstrained by sector and uses a disciplined, bottom-up research approach.