It’s both significant and depressing that over three-quarters of the space we devote to industry news, the special provenance of this feature, focuses on funds (and ETFs) that are being liquidated.
Briefly Noted . . .
SMALL WINS FOR INVESTORS
Effective April 1, 2019, the management fee for the ClearShares Ultra-Short Maturity ETF (OPER) has been reduced to 0.20%.
The $1.4 billion Columbia Small Cap Value II (COVAX) recently reopened to new investors after being closed since May 2008.
Effective April 17, 2019, the Silver-rated Diamond Hill Small Cap Fund (DHSCX) reopened to new investors.
The Bronze-rated Vulcan Value Partners Fund (VVPLX) is no longer closed to new investors.
While both funds have a lot going for them, their records of the past five years has been distinctly mixed. In the table below are the five-year ratings for each fund from MFO Premium. The colors tell the tale: red cells represent values in the worst 20% of their peer groups, blue are the best 20%.
Neither fund seems to have had a great run over the past five years, though Diamond Hill has entirely admirable volatility management. With the funds having trailed 91% and 87% of their Lipper (not Morningstar, which are a bit better) peers, respectively, the question for prospective investors is whether they have reason to believe that conditions – either at the funds or in the market – have changed enough to warrant an investment.
OLD WINE, NEW BOTTLES
Losing their growth: The Alambic Mid Cap Growth Plus Fund (ALMGX) and Alambic Small Cap Growth Plus Fund (ALGSX) have been renamed Alambic Mid Cap Plus Fund and Alambic Small Cap Plus Fund, respectively.
Lord Abbett Micro Cap Value Fund has become Lord Abbett Focused Small Cap Value Fund.
YieldShares High Income ETF (YYY) will soon morph into Amplify High Income ETF, which will have the same strategy as the original but a new management team.
OFF TO THE DUSTBIN OF HISTORY
Affinity Small Cap Fund (AISOX) will liquidate on May 17, 2019.
AMG Systematic Mid Cap Value (SYAMX) has begun the process of liquidation (also termination and dissolution), which should be complete by June 4, 2019.
Ariel Discovery Fund (ARDFX) is merging with and into Ariel Fund (ARGFX), on or after June 21, 2019.
Causeway International Value NextShares (CIVEC) and Causeway Global Value NextShares (CGVIC), two actively-managed ETFs, will be liquidated on May 13, 2019. The funds raised just a few million each in their one year of operation.
Cboe Vest S&P 500® Enhance and Buffer Fund (MRALX) liquidated, on less than three weeks’ notice, on April 29, 2019. It did so because “the Adviser does not want to continue supporting the Fund considering the availability of the strategy in other investment products that are offered by the Adviser.” With due deference to the adviser and the fund’s board, the “other products” (for example, the Market Neutral Yield Strategy, which launched in 2016) were around on the day the fund launched less than two years ago. An alternate explanation might be that the fund has $5 million in assets which generates $60,000 in annual income for the adviser and, since assets were going down, so was that modest stipend. (Really, they might generate more income by getting a Keurig machine and charging two bucks a shot for hot caffeine.)
Cedar Ridge Unconstrained Credit Fund (CRUPX) will be merged with Shelton Tactical Credit Fund (DEBTX) some time in the second quarter of 2019.
Diamond Hill Financial Long-Short Fund (BANCX) will merge with Diamond Hill Research Opportunities Fund (DHROX), effective on or about June 7, 2019. That decision was based “largely” on low asset levels in BANCX and “its history of net redemption activity.”
Eagle Rock Floating Rate (ERFAX) liquidated on April 3, 2019.
First Trust AQA Equity Fund (AQAAX) will terminate and liquidate (a twofer!) on June 25, 2019.
Subject to shareholder approval, FundX Tactical Upgrader Fund (TACTX) will merge into the FundX Conservative Upgrader Fund (RELAX) sometime over the summer. If nothing else, FundX is good at tickers.
Highland Tax-Exempt Fund (HTXAX) will go away on or about May 15, 2019
Hussman Strategic Value Fund (HSVLX) has closed to new investments and will liquidate on my birthday, May 29, 2019. Within a month of that event, Hussman will launch another distinctly-Hussman fund which we chronicle in this month’s Funds in Registration.
IQ-Striquer Fund (IQSAX) will be closing and liquidating on May 29, 2019. (Had I mentioned the date of mon anniversaire de naissance?)
A few weeks after the death of founder Frank James, the Board of Trustees of The James Advantage Funds approved the liquidation of the James Long-Short Fund (JAZZX) and the James Mid Cap Fund (JAMDX). An interesting note followed: “As a result of three shareholders of each Fund collectively owning a majority of the outstanding voting securities of that Fund and indicating that they would vote in favor of such liquidation, shareholder approval is anticipated to be received with respect to each Fund in late April or early May 2019.”
The good folks at Keeley Funds profess to be “pleased to announce” that Keeley Small Cap Value Fund (KSCVX) will be “reorganized into Keeley Small Cap Dividend Value Fund (KSDX) on June 7, 2019, at which point Small Cap Value will undergo “liquidation and dissolution.” I would have thought the reorganized out of existence part would have pretty much covered the same territory as the “liquidate and dissolve” part. That just illustrates the difference between folks with PhDs and those with JDs.
The Board of the Hennsler funds was similarly pleased to announce the transformation of their Hennsler Equity Fund (HEQFX) into the new Monteagle Opportunity Equity Fund on or about May 25, 2019.
Morgan Stanley Institutional Global Multi-Asset Income Portfolio (MSGOX) will be liquidated on or about May 31, 2019. “The Fund will suspend the offering of its shares to all investors at the close of business on or about May 29, 2019.” which is (a) my birthday! and (b) silly. Why continue accepting investments knowing that they have to be immediately returned?
Nuveen Multi-Asset Income Fund will be liquidated after the close of business on May 17, 2019.
QuantX Risk Managed Growth ETF (QXGG), QuantX Risk Managed Multi-Asset Total Return ETF (QXTR) and QuantX Dynamic Beta US Equity ETF (XUSA) will liquidate in May.
Skybridge Dividend Value Fund (SKYAX) will merge into Centre Global Infrastructure Fund (DHIVX) or about July 19, 2019. The handwriting was on the wall when Morningstar featured Skybridge in an article entitled “Stay Away From These Funds” (2018).
In a classic case of overkilling the kill: “Effective April 26, 2019, each of the Virtus Newfleet CA Tax-Exempt Bond Fund , Virtus Seix Georgia Tax-Exempt Bond Fund, Virtus Seix North Carolina Tax-Exempt Bond Fund and Virtus Seix Virginia Intermediate Municipal Bond Fund was liquidated. Each Fund has ceased to exist and is no longer available for sale. Accordingly, each Fund’s Prospectuses and SAI are no longer valid.”
Wintergreen Fund (WGRNX) has closed and will liquidate on June 3, 2019. This is one of those cautionary tales about superstar managers (which Mr. Winters, protégé of Michael Price, who was protégé of Max Heine, certainly was) striking out on their own. Having been there at its launch, we’ll try to reach out to Mr. Winters as he brings his fund to ground to see how a first-rate guy makes sense of navigating a second-rate market.
Xtrackers Germany Equity ETF and Xtrackers MSCI United Kingdom Hedged Equity ETF liquidated on April 30, 2019.