Timothy Malloy, co-manager of the top-ranked John Hancock Global Opportunities Fund, has been paring bets on commodity-related stocks that...
Timothy Malloy, co-manager of the top-ranked John Hancock Global Opportunities Fund, has been paring bets on commodity-related stocks that helped the fund beat all rivals during the past year.
Malloy cut stakes in the past two months in energy stocks such as British Energy Group to 18 percent from about 29 percent a year earlier, after oil prices surged. He trimmed holdings in materials companies to 25 percent from 30 percent, and raised stakes in financial companies including Charles Schwab as they’ve plunged.
“We’re looking to take some profits in the sectors that have done extremely well and reinvest those profits in areas that we’ve been avoiding for several years, like financials,” Malloy said from his office in Boston, where he helps oversee $4.5 billion in value-oriented strategies.
The $104 million Global Opportunities advanced 20 percent in the past year, through May 28, the most of 144 funds that invest in stocks all over the world, according to data compiled by Morningstar in Chicago.
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The fund has Morningstar’s highest rating of five stars. It has a three-year Sharpe ratio of 1.25, compared with 0.80 for competing funds, Morningstar data show. A higher Sharpe ratio means better risk-adjusted returns.
Malloy and his co-managers are cutting back as energy companies in the Standard & Poor’s 500 Index are outperforming the broader market for the ninth straight year on surging demand for oil.
The Global Opportunities Fund has 34 percent of its assets in the U.S. and 21 percent each in Brazil and Canada. The remainder is distributed in the U.K., Germany, France and South Africa.
Malloy sold British Energy, among the fund’s top five positions last year, after the shares doubled during the past two years.
The fund’s top holding as of April 30 was Agrenco, the Bermuda-based agricultural and biofuels company.
The fund’s second-largest holding is Toronto-based Franco-Nevada, a mining and energy royalty company, which accounts for 5.6 percent of the fund’s assets.
American Oriental Bioengineering, which is based in Harbin, China, and makes plant-based medicines and diet supplements, is the fund’s third-biggest stock, representing 5.3 percent of fund assets.
Malloy has tripled his stakes in financial shares to 7.4 percent in the past year by investing in San Francisco-based discount broker Schwab and Wright Express, an auto-fleet billing company.