CHICAGO, April 12 /PRNewswire/ -- Effective April 1, 2005, Harris
Associates L.P. has discontinued the use of "soft dollars" to pay for third-
party research and services for all client accounts, including The Oakmark
Funds. The future cost of these services will be paid entirely by Harris
TRADING AND SOFT DOLLAR PRACTICES
"We have always been mindful of how to best serve our clients and
shareholders -- and how to do so fairly," says John Raitt, President and CEO
of Harris Associates L.P. and President of The Oakmark Funds. "We have
recently given a significant amount of thought and attention to our trading
practices, as the equity trading and execution landscape has changed
tremendously over the past few years. The traditional institutional stock
brokerage arrangement -- where trade execution is bundled with research and
other services into one commission charge -- is beginning to unravel under the
pressure of market forces. These trends have caused us to reassess our
approach to the use of 'soft dollar' commissions to pay for third-party
research and services."
"Our soft dollar practices have always been well within the scope of SEC-
sanctioned practices, which explicitly permit the use of brokerage commissions
to pay for such services," continues Raitt. "We believe that we have been
small users of third-party research and services compared to most investment
advisers, and we don't believe that our use of soft dollars has increased
trading costs. However, as the brokerage industry moves toward unbundling
trading from research and other services, we are less confident that this will
be true in the future."
For this reason, Harris Associates has discontinued the use of soft
dollars to pay for third-party research and services, effective April 1, 2005.
"Our primary trading focus, as always, will be to obtain best execution for
our clients and shareholders, and clients can be assured that we will continue
to monitor industry developments," states Raitt.
UPDATE ON PERSONAL INVESTMENT IN THE OAKMARK FUNDS
One of the key components of the Harris Associates investment process has
been to invest in companies where management interests are closely aligned
with those of shareholders. While there are many ways to create such a link,
the investment team believes that this alignment is most frequently and most
effectively created by significant management stock ownership.
"When management has a meaningful sum invested alongside other
shareholders, the focus on performance and shareholder value is intensified,"
comments Raitt. "We believe that this same approach is also wise for mutual
fund investors. Significant ownership of fund shares -- not just by portfolio
managers, but by all levels of employees at the fund and its adviser
(including analysts, senior management, trustees and others) -- reinforces a
higher standard of integrity, focus, and commitment to maximizing long-term
"A commitment to the share ownership is an integral part of our business
philosophy. We encourage employee ownership of the Funds and are committed to
reporting on our ownership on a regular basis," ends Raitt.
As of December 31, 2004, the employees of the Funds' adviser, Harris
Associates L.P., and the Funds' trustees have over $180 million invested in
The Oakmark Funds. This compares to an investment of $145 million in December
2003, when Harris Associates last reported holdings. This increase represents
a combination of price appreciation and additional purchases.
More information about Oakmark's commitment to shareholders, the Oakmark
investment philosophy and process, and manager commentary and fund holdings
can be accessed at http://www.oakmark.com .
ABOUT THE OAKMARK FUNDS AND HARRIS ASSOCIATES L.P.:
The Oakmark Funds are a $29.6 billion mutual fund family that utilizes a
long-term value investment approach. Harris Associates L. P., a Chicago-based
investment management firm founded in 1976, also manages domestic and
international separate accounts for institutional and high net worth
investors. The Oakmark Funds are distributed by Harris Associates Securities
L.P., member NASD. For more information, including management fees and
expenses and the special risks of investing, visit http://www.oakmark.com or
call 1-800-OAKMARK for a prospectus. An investor should consider a fund's
investment objectives, risks, and charges and expenses carefully before
investing. This and other information are contained in the prospectus.
SOURCE Harris Associates L.P.