AQR Style Premia Alternative Fund
AQR Style Premia Alternative Fund will seek to provide absolute returns by magically combining four investing styles (value, momentum, carry and defensive), five asset classes (equities, bonds, interest rates – how did interest rates get to be an asset class? – commodities and cash), both long and short, in an ever-changing mix which targets an as-yet unspecified volatility target and volatility band. AQR famously manages such complex strategies which work except when they don’t (their Risk Parity fund, for example, dropped nearly 10% in the second quarter of 2013 while its Morningstar benchmark dropped a half percent). It will be managed by Ronen Israel, Jacques A. Friedman, Lars Nielsen, and Andrea Frazzini, all of whom advertise their academic degrees after their names. Expenses not yet disclosed. The minimum initial purchase is $1 – 5 million, though places like Schwab tend to offer AQR funds at $2500.
AT Mid Cap Equity Fund
AT Mid Cap Equity Fund will pursue long-term growth by investing in midcap stocks (those in the $2 – 18 billion range). Up to 25% might be invested overseas. The managers will look for companies that can deliver consistently strong earnings growth, free cash flow growth and above average return on equity, and which has a history of growth. They aspire to buy and hold for the long-term. The fund will be managed by Frederick L. Weiss and Jay Pearlstein. The minimum initial investment is $3,000. The expense ratio will be 1.39%
AT Income Opportunities Fund
AT Income Opportunities Fund seeks current income and long-term capital appreciation through a portfolio of common and preferred stocks and bonds. Up to 25% might be investing in foreign securities and another 25% might be in the sale of call or put options. They’ll start by trying to find attractive, well-positioned companies and then they look across the capital structure to find the most attractive way to invest in it. The fund will be managed by Gary Pzegeo and Brant Houston. The minimum initial investment is $3,000. The expense ratio will be 1.25%.
Baron Discovery Fund
Baron Discovery Fund will seek capital appreciation through investments in small growth companies with market capitalizations of less than $1.5 billion whose stock could increase in value 100% within four to five years. This market cap is below the upper limit set for BMO Micro Cap, below. In a singular, and singularly-bizarre development two analysts, Laird Bieger and Randolph Gwirtzman, has been given the title of “co-managers” but Baron seems unsure that they’re ready for the responsibility so they’ve appointed a “Portfolio Manager Adviser.” Here’s the text: “Cliff Greenberg has been the portfolio manager adviser of Baron Discovery Fund since its inception on [ ], 2013. In this role, he advises the co-managers of the Fund on stock selection and buy and sell decisions and is responsible for ensuring the execution of the Fund’s investment strategy. Mr. Greenberg has been the portfolio manager of Baron Small Cap Fund since its inception on September 30, 1997.” $2000 minimum initial investment, reduced to $500 for accounts set up with an AIP. Expenses not yet announced.
BFS Equity Fund
BFS Equity Fund (BFSAX) will pursue long-term appreciation through growth of principal and income. The plan is to buy quality companies which have experienced an “opportunistic event” which might increase their value or temporarily decrease their price. The managers can invest directly in stocks or in ETFs, which is hard to square with the desire to exploit opportunities which, presumably, affect individual firms. The managers will be Keith G. LaRose, Timothy H. Foster, and Thomas D. Sargent, all of whom have some combination of substantial management experience with private and institutional accounts or hedge funds. The firm has been managing private accounts in this style since the mid-1990s. Their returns minutely trail the S&P500 throughout, though they did substantially outperform the market in 2008. $1000 investment minimum. Expenses not yet set.
BMO Micro-Cap Fund
BMO Micro-Cap Fund will seek long-term capital appreciation by investing in a diversified portfolio of micro-cap (under $2.3B) stocks. No detail on stock selection processes, other to invoke normal “good companies at good prices” sorts of language. Thomas Lettenberger and Ernesto Ramos, Ph.D. will co-manage the Fund. The minimum initial investment will be $1000. Expenses are not yet set.
BMO Global Low Volatility Equity Fund
BMO Global Low Volatility Equity Fund will pursue capital appreciation by investing in a globally diversified portfolio of “low volatility, undervalued stocks [selected] using a unique, quantitative approach based on the Adviser’s multi-factor risk/return models. This approach seeks to provide the Fund with lower downside risk and meaningful upside protection relative to the MSCI All Country World Index.” David Corris, Jason Hans, and Ernesto Ramos, Ph.D. will co-manage the Fund. They also manage separate accounts using this strategy but (1) their composite dates back only 15 months and (2) they haven’t yet disclosed the composite’s performance. They’ve also run a domestic low volatility fund (BMO Low Volatility Equity, MLVYX) for rather less than a year and it’s not immediately apparent that the fund is less volatile than the market. The minimum initial investment will be $1000. Expenses are not yet set.
DFA Short-Duration Inflation Protected Securities Portfolio
DFA Short-Duration Inflation Protected Securities Portfolio will seek to provide inflation protection and maximize total returns by investing directly or through other DFA funds in a combination of debt securities, including inflation-protected securities. “At inception, the Portfolio will invest a substantial portion of its assets in the DFA Short-Term Extended Quality Portfolio, DFA Intermediate-Term Extended Quality Portfolio and DFA One-Year Fixed Income Portfolio, but it is contemplated that the Portfolio will also purchase securities, including inflation-protected securities and derivative instruments directly.” David A. Plecha and Joseph F. Kolerich will manage the fund. No minimum is specified. The expense ratio is 0.24%. You can’t have the fund, but it’s always good to know what the “A”-level teams are thinking and doing.
FlexShares Global Infrastructure Index Fund
FlexShares Global Infrastructure Index Fund will try to match the returns of an as-yet unnamed Global Infrastructure Index. They’ll invest in both developed and emerging markets. Infrastructure assets, the fund’s target, includes “physical structures and networks upon which the operation, growth and development of a community depends, and include water, sewer, and energy utilities; transportation, data and communication networks or facilities; health care facilities, government accommodations, and other public-service facilities; and shipping.” Also unnamed is the expense ratio.
Horizon Tactical Income Fund
Horizon Tactical Income Fund will seek “income” (they modestly avoid adjectives like “maximum” or “high”) by investing in ETFs, sovereign and corporate debt, preferred and convertible securities, REITs, MLPs and mortgage-backed securities. They propose to make tactical shifts into whatever segment offers “the highest expected return for a given amount of risk” (though it’s not clear whether there’s a risk or volatility target for the fund). It will be managed by Robbie Cannon, President and CEO of Horizon, Ronald Saba, Director of Equity Research, Kevin Blocker and Scott Ladner, Director of Alternative Strategies. The minimum initial investment is $2500. The expense ratio will be 1.44%.
Innealta Risk Based Opportunity Moderate Fund
Innealta Risk Based Opportunity Moderate Fund, “N” shares, will seek long-term capital appreciation and income by investing in a wide variety of ETFs. Which ETFs? The process appears to start by confusing tactics with strategies: “In the first stage, the Adviser defines its Secular Tactical Asset Allocation (STAA), which is a longer-term-oriented strategic decision that is steeped in classic portfolio construction approaches to asset allocation.” From there they add a Cyclical Tactical Asset Allocation (stage two) and top it off with “a third stage of tactical management in which the Adviser augments the portfolio with those exposures it believes can further enhance risk-relative returns.” That third stage might add “long/inverse and leveraged long/inverse equity, fixed income, commodity, currency, real estate and volatility asset classes.” The fund will be managed by Gerald W. Buetow, JR., Ph.D., CFA, CIO of AFAM (formerly Al Frank Asset Management). $5000 investment minimum. Expenses not yet disclosed.
Wavelength Interest Rate Neutral Fund
Wavelength Interest Rate Neutral Fund will seek total return through a global, fixed-income portfolio including “developed-market nominal government bonds, developed-market inflation-linked government bonds, emerging market local-currency fixed-income securities, emerging market USD-denominated fixed-income securities, sovereign debt, corporate debt, and convertible bonds.” The manager plans to invest in “securities that are fundamentally related to growth and inflation, and in doing so, seeks to systematically balance investment exposures across potential interest rate changes.” Andrew Dassori, Wavelenght’s CIO, will be the portfolio manager. The minimum initial investment is $100,000. Expenses have not yet been announced.