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Harbor Mid-Cap Value: Not Your Standard Quant Fund

This Bronze-rated fund boasts a proven management and process, and offers a decent risk/reward trade-off.


Dan Culloton: Experienced management and a disciplined, systematic approach to value investing should serve Harbor Mid Cap Value investors well over the long term.

LSV Asset Management has run this fund, to which we give a Bronze Morningstar Analyst Rating, since 2004. It uses a quantitative, or computer-based, process developed by Josef Lakonishok, a leading academic in the area of value investing and behavioral finance with nearly 30 years of investment experience.

LSV's quant process doesn't use unique factors; it uses valuation, size, and momentum factors like a lot of other quants. But it does put more emphasis on valuation and keeps turnover low, which is actually quite unique for a quant fund.

It produces a broadly diversified, but deep value portfolio that over time has produced returns competitive with other mid-cap value funds and the Russell Mid Cap Value Index.

The fund has been a little more volatile than its average peer, but with below average expenses, proven management and process, and good long-term returns, it offers a decent risk/reward trade-off.

Dan Culloton does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.