Category Archives: Mutual Fund Commentary

Liquidity Risks and Warnings

By David Snowball

What’s the worst that could happen? Managers’ own words on liquidity risks

Liquidity seems like an awfully esoteric concern, something akin to “coverage ratios” or “yield to call calculations.” In general, it feels like background noise.

Your fund managers disagree. New research estimates that 50% of high-yield funds and, more importantly, 15% of all fixed-income funds are vulnerable to a liquidity crunch. To understand what that means, you first need to understand that “liquidity” means. If you need to polish up your understanding of the term – or your ability to explain it to clients – start with the section entitled What’s Liquidity? If you’re rock solid on the concept, then jump ahead to Welcome to a Liquidity Crisis. Continue reading →

Business Cycle Portfolio Strategy

By Charles Lynn Bolin

The mere fact that a belief is common and comfortable does not make it true. Accepting such beliefs makes you part of “the herd,” which is good only when the herd is thriving. But when the herd faces serious threats from hostile changes in their environment, whether it’s drought or wolves, the last thing you want is to have your survival tied tightly to the herd’s.

That holds true in investing, as well as in pastures.

Two such errors animate this month’s essay. First, there appears to be Continue reading →

Small-Cap Dividend Options

By David Snowball

We’ve written in November and December about two excellent options for investors interested in small-cap funds with a dividend focus. Those are Crawford Small Cap Dividend (CDOFX) and North Star Dividend (NSDVX). What might interest you about such funds?

    1. Over the long term, small caps outperform large caps
    2. Over the long term, dividends bolster returns and dampen volatility
    3. There are hundreds of small stocks which pay dividends, but they’re mostly underfollowed and rarely included in passive ETFs / index funds

Readers who would like to Continue reading →

Launch Alert: Virtus KAR International Small-Mid Cap Fund

By David Snowball

On October 1, 2019, Virtus launched Virtus KAR International Small-Mid Cap Fund (VKIAX). The fund is managed by the KAR of the title: Kayne, Anderson Rudnick Investment Management, Virtus’s largest wholly-owned subsidiary. KAR, based in Los Angeles, manages rather more than $17 billion in assets. Across all of their portfolios, KAR emphasizes two core attributes Continue reading →

Funds in Reg

By David Snowball

The Securities and Exchange Commission, by law, gets between 60 and 75 days to review proposed new funds before they can be offered for sale to the public. Each month, Funds in Registration gives you a peek into the new product pipeline. Most funds currently in registration will not become available until January, which is a really bad problem for those trying to market the funds. Because these funds won’t be trading on the first day of the year, they’re not eligible for “year-to-date” returns reports and reporting services such as Morningstar won’t give them “credit” for Continue reading →

Briefly Noted

By David Snowball

This is a first for us. Aspiriant Defensive Allocation Fund (RMDFX) will be reorganized as a newly created closed-end fund called (ready?) Aspiriant Defensive Allocation Fund that will operate as an interval fund.  The change should occur by the end of the first quarter of 2020.

Closed-end funds? Hard to remember that they’re alive and well. That slice of the industry originated in the 1890s and they’re sort of an open-end mutual/active ETF Continue reading →

November 1, 2019

By David Snowball

Dear friends,

It’s November 1, the traditional beginning of the holiday avoidance season. It’s the time of year when I program-out the local radio stations (not listening to you, Mix96) that switched to the 24/7 Christmas music today and the big box retailers who have declared that November 1 is Black Friday. (Looking at you, Kohls.) I will, with all my might, avoid their tinsel-festooned commercial caverns all of this month, and as much of next as I might.

That’s not because I dislike the year-end holidays. No, quite to the contrary: I’ve always embraced the communal spirit of celebration, the defiance Continue reading →

Living a Rewarding Retirement

By Robert Cochran

Some Thoughts on Social Security, Medicare, and the Markets

I’ve been officially retired for just more than two years. During that time, I have been asked numerous times about when to take Social Security retirement benefits. My general response is that it pays to delay receipt of benefits to age 70. After that, there is no incentive to delay other than potential income taxes.

A recent study, “The Retirement Solution Hiding in Plain Sight” by United Income (June, 2019), indicates most people would say “yes” to making one simple retirement planning decision that could mean more income during retirement. But the same study shows that 96% of retirees take their first Social Security check at Continue reading →

Limiting Choices

By Charles Lynn Bolin

Oddly enough, the most time-consuming part of investing for me is limiting my choices. To simplify and streamline the process, I looked at fund families with top performing mutual funds that are available as no-load funds with low minimum investments through Charles Schwab, Fidelity or Vanguard.

Investment Model

Hedge fund billionaire Ray Dalio, in our Continue reading →