April 2023 IssueLong scroll reading

Briefly Noted…

By TheShadow


Vanguard launched its Short-Term Tax-Exempt Bond ETF on March 9th. The ETF will optimize tax efficiency for investors seeking to allocate to the shorter end of the municipal bond market. It predominantly invests in short-term investment grade municipal bonds and will track the S&P 0-7 Year National AMT-Free Municipal Bond Index. It has an expense ratio of 0.07%, compared to 0.56% for the average short-term bond fund. Steve McFee, CFA, who has been at Vanguard for 18 years, is the portfolio manager of Vanguard Short-Term Tax-Exempt Bond ETF.

T. Rowe Price Hedged Equity Fund is in registration. The fund seeks to achieve its objective by investing in a broad portfolio of U.S. large-cap stocks while using hedging strategies designed to mitigate tail risk (i.e., the threat of significant losses during an equity market drawdown) and provide strong risk-adjusted returns with lower volatility than the overall equity markets. The fund seeks to cushion volatility during equity market downturns and incorporate modest leverage in a way that preserves returns that may be generated from stock selection while reducing the volatility inherent in investments in equity securities over time. The fund will be managed by Sean P. McWilliams. The total annual fund operating expenses after the fee waiver will be .90% for the investor share class.

The Riverpark/Next Century Growth Fund is in registration. It seeks to achieve its investment objective by investing in small-cap companies that the Fund’s sub-adviser, Next Century Growth Investors, LLC (“NCG”), believes will sustain above-average revenue and earnings growth over time or which are expected to develop rapid sales and earnings growth in the future when compared to the economy and stock market as a whole. The Sub-Adviser employs a “bottom-up” approach in its stock selection, which is the use of fundamental analysis to identify companies that it believes, over the long term, will surpass consensus earnings estimates. Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement will be 1.4% for the retail share class.

NCG has five portfolio managers dedicated to the Fund who operate as a team throughout all aspects of the investment process. Thomas L. Press, Chairman, Chief Executive Officer, Portfolio Manager, and Partner, has been with NCG since he founded it in November 1998. Robert E. Scott, President, Portfolio Manager, has been with NCG since 2000. Peter M. Capouch, Chief Operating Officer and Portfolio Manager, has been with NCG since 2003. Kaj Doerring, Portfolio Manager, Partner, has been with NCG since 2005. Tom Dignard, Portfolio Manager, Partner, has been with NCG since 2013.

T. Rowe Price has filed its registration filing for the Capital Appreciation Equity ETF. Total annual fund operating expenses are stated at 0.31%; it will be managed by David Giroux.

This will be in addition to T. Rowe Price’s several other ETFs: QM U.S. Bond ETF, Total Return ETF, Ultra Short-Term Bond ETF, Floating Rate ETF, U.S. High Yield ETF, Small-Mid Cap ETF, Value ETF,  Growth ETF, International Equity ETF, Equity Income ETF, U.S. Equity Research ETF, Blue Chip Growth ETF, and Dividend Growth ETF.

Small Wins for Investors

Janus Henderson Small Cap Value Fund is reopening to new investors, except class L shares, on or about April 17th.

T. Rowe Price’s New Horizon and Emerging Markets Stock Funds, rated four stars and two stars by Morningstar, respectively, are reopening to new investors who invest directly with T. Rowe Price effective April 26th. The New Horizon Fund has been closed since 2013; the Emerging Markets Stock Fund has been closed since 2018.

Closings (and related inconveniences)

Kopernik Global All-Cap Fund will close to new investors on June 1st. The fund reopened to new investors on January 3, 2023, after being closed since March 31, 2021.

Old Wine, New Bottles

Hartford Quality Value Fund will convert to an exchange traded fund on or before November 30, 2023.

AMG GW&K Small/Mid Cap Fund is changing its name to AMG GW&K Small/Mid Cap Core Fund.

Invesco International Equity is being reorganized into the Invesco EQV International Equity Fund. If the reorganization is approved at a shareholder meeting on or about July 12th, the reorganization is expected to be completed shortly thereafter.

Polen Global Emerging Markets Growth Fund changed its name to Polen Global Emerging Markets Growth Fund effective March 13th.

Leader High Quality Floating Rate Fund is changing its name to the Leader Capital High Quality Income Fund on or about May 16th. The fund will also be changing its investment policy on May 16th.

The dustbin of history

BNY Mellon Alternative Diversifier Strategies Fund will be liquidated on or about May 12th.

BNY Mellon Diversified Emerging Markets Fund will be liquidated on or about May 12th.

American Beacon AHL TargetRisk Core Fund will be liquidated on or about July 7th.

JOHCM Credit Income and the JOHCM Global Income Builder Funds will be liquidated on or about May 26th.

Clough Global Long/Short Fund will be liquidated on or about April 24th.

This entry was posted in Briefly Noted, Mutual Fund Commentary on by .

About TheShadow

The Shadow here! Like Mark, I’m a long-time member of the MFO community. I’ve started over 2300 discussion threads, most focusing on developments in the fund industry. I am a personal investor that was introduced to mutual funds when I was young to fund my college education. As I have grown older, I have expanded my mutual funds holdings to a point where I probably have too many; however, this year they all did extremely well due to the overall performance of the market. I work in the financial industry regulating the consumer finance industry in my state. My hope for the months ahead is that I might share word of developments in the finance industry – the comings and goings, launches and liquidations, the fun and the follies – with you.