Oakmark is a mutual fund company, not a single fund

Oakmark is the name of an investment company that manages multiple mutual funds. When someone asks "Is Oakmark a mutual fund?" they usually mean one of two things: either they own a fund with Oakmark in the name, or they want to know whether Oakmark itself is a mutual fund. The answer to the second question is no — Oakmark is the fund manager, the company that runs the funds. The funds themselves are the products you can buy.

Oakmark manages several different mutual funds with different investment strategies and holdings. Each one has its own ticker symbol, expense ratio, and performance history. Some are stock funds, some hold bonds, and some mix both. Knowing which Oakmark fund you own — or are considering — matters because they behave differently and carry different risks.

The company was founded in 1991 and is based in Chicago. It is owned by Harris Associates, a separate investment firm. This matters because it means Oakmark funds are managed by the same team and philosophy across all their products, but they are not all identical.

Key Takeaways

  • Oakmark is a fund manager that runs multiple mutual funds, not a single mutual fund itself.
  • Each Oakmark mutual fund has its own ticker symbol, expense ratio, and investment strategy, so you need to know which specific fund you own.
  • Oakmark funds focus on value investing, meaning they look for stocks they believe are trading below their true worth.
  • You can buy Oakmark mutual funds through most brokerages, retirement accounts, and some employer 401(k) plans.

The different Oakmark mutual funds and what they invest in

Oakmark manages funds that focus on different types of stocks and different market sizes. The Oakmark Fund (ticker OAKMX) is their flagship product and invests in large U.S. companies. The Oakmark Select Fund (ticker OAKLX) is more concentrated, meaning it holds fewer stocks but in larger positions. There is also Oakmark International Fund (ticker OAKIX), which invests in stocks outside the United States.

For investors who want bonds mixed in, Oakmark offers Oakmark Equity and Debt Fund (ticker OAKBX), which holds both stocks and bonds. They also manage funds focused on smaller companies and funds designed for specific investor types, such as those in retirement accounts.

The key thing these funds share is their investment approach: Oakmark managers look for stocks they believe the market has undervalued. This is called value investing. They do research on individual companies and try to buy when the price is low relative to what they think the company is worth. This approach can work very well in some years and lag behind in others, depending on whether the market rewards value stocks or growth stocks.

How Oakmark funds charge fees

Like all mutual funds, Oakmark funds charge an expense ratio — an annual percentage fee taken from the fund's assets to pay for management, administration, and other costs. This fee varies by fund. Some Oakmark funds charge around 0.6 to 0.9 percent per year, while others charge less or more depending on the fund's size and complexity.

You do not pay this fee as a separate bill. It comes out of the fund's returns automatically. If a fund returned 10 percent in a year and has a 0.7 percent expense ratio, you would see a 9.3 percent return in your account. The expense ratio is one reason to compare Oakmark funds to other fund managers — some competitors charge lower fees for similar strategies.

Oakmark funds may also charge a sales load depending on which share class you buy and where you buy it. A load is an upfront or back-end fee paid to a broker or advisor. Many brokerages now offer Oakmark funds without a load, but you should check before you buy.

Where you can buy Oakmark mutual funds

You can purchase Oakmark mutual funds through most major brokerages, including Fidelity, Schwab, Vanguard, and E*TRADE. You can also buy them directly from Oakmark's website if you open an account with them. Some employer 401(k) plans include Oakmark funds as one of the investment options, though not all do.

The minimum investment to open an Oakmark account directly varies by fund but is often $1,000 or $2,500 for the initial purchase. If you buy through a brokerage, the brokerage may have its own minimum or no minimum at all. Subsequent purchases are usually smaller.

If you own Oakmark funds in a retirement account like an IRA or 401(k), the rules about buying and selling are the same as for any mutual fund in that account. You can trade them without triggering a tax event inside the account, but you cannot withdraw money without potential penalties until you reach the account's withdrawal age.

How Oakmark funds perform compared to benchmarks

Oakmark funds are measured against benchmarks — standard indexes that represent the market or market segment they invest in. The Oakmark Fund is typically compared to the S&P 500 index, which tracks 500 large U.S. companies. The Oakmark International Fund is compared to international stock indexes.

Performance varies year to year. In some years, Oakmark funds beat their benchmarks. In others, they lag behind. This is normal for actively managed funds — managers make bets that sometimes work and sometimes do not. Over longer periods (10 years or more), you can look at whether the fund has beaten its benchmark on average and whether the fees justify the performance.

You can find Oakmark fund performance data on financial websites like Morningstar, Yahoo Finance, and the Oakmark website itself. These sites show returns for different time periods (one year, three years, five years, ten years) and compare them to the fund's benchmark and to similar funds run by other managers.

The difference between Oakmark mutual funds and Oakmark ETFs

Oakmark also offers exchange-traded funds (ETFs) in addition to mutual funds. An ETF is similar to a mutual fund but trades on a stock exchange like a stock does. You can buy and sell it during the trading day at changing prices, whereas mutual funds are priced once per day after the market closes.

Oakmark ETFs follow the same value investing philosophy as their mutual funds but may have different holdings and expense ratios. Some investors prefer ETFs for their flexibility and tax efficiency, while others prefer mutual funds for their simplicity or because their retirement account makes mutual funds easier to use.

If you are deciding between an Oakmark mutual fund and an Oakmark ETF with similar strategies, compare the expense ratios, the holdings, and how you plan to buy and sell. For most long-term investors in retirement accounts, the difference is small.

Frequently Asked Questions

Can I lose money in an Oakmark mutual fund?

Yes. Oakmark mutual funds invest in stocks, and stock prices go up and down. If the stocks in the fund fall in value, your fund shares fall too. Over short periods (months or a year or two), losses are possible. Over longer periods, stock funds have historically recovered and grown, but past performance does not may provide future results.

What is the minimum investment to buy an Oakmark fund?

If you buy directly from Oakmark, the minimum is usually $1,000 to $2,500 for the initial purchase, depending on the fund. If you buy through a brokerage like Fidelity or Schwab, the brokerage's minimum applies instead — many have no minimum or a lower one. Check with your brokerage or Oakmark's website for the exact amount.

Do Oakmark funds pay dividends?

Many Oakmark funds do pay dividends, which are portions of company profits distributed to shareholders. The fund collects dividends from the stocks it owns and passes them to you. You can usually choose to receive the dividend as cash or reinvest it to buy more fund shares. Check the fund's prospectus or fact sheet to see its dividend history.

Is Oakmark a good fund for beginners?

Oakmark funds are actively managed and follow a value investing strategy, which can be a good fit for some investors but not others. Beginners should understand that value funds sometimes underperform for years before outperforming, and that Oakmark's fees are higher than some index funds. Compare Oakmark to other options before deciding.

Can I hold Oakmark funds in a retirement account?

Yes. Oakmark funds can be held in IRAs, 401(k)s, and other retirement accounts. The rules about contributions, withdrawals, and taxes are the same as for any mutual fund in that account type. Check whether your retirement account provider offers the specific Oakmark fund you want to buy.