The word of the week is “Mauritius.”
For those of us who dozed through World Geography we’ve highlighted the country in question.
Google kindly offers the following snapshot: “Mauritius, an Indian Ocean island nation, is known for its beaches, lagoons and reefs. The mountainous interior includes Black River Gorges National Park, with rainforests, waterfalls, hiking trails and Continue reading →
One of the charms of our country is all of the stuff we don’t ask. Our federal census does not, and has not since the 1950s (quick thanks to David Moran for his insight into census history), asked people about their religious preference or practices. That’s good because it’s none of the guvmint’s damned business. It’s also bad because religion is an important element of our individual and collective culture; in the absence of official estimations, a host of (sometimes laughably inept) unofficial calculations substitute.
The Pew Research Center (2018) estimates that there are “3.45 million Muslims of all ages living in the U.S. in 2017, and that Continue reading →
Active management, as a discipline, is hard.
Active management, as a sustainable business, is harder.
Active management, as a sustainable business run by an independent investment boutique, no matter how skilled, is crazy hard, getting crazier and getting harder.
When, on top of all that, it feels like a megalithic corporation has it out for you, you’d surely feel like it’s time to surrender and put Sisyphus on the Continue reading →
Investors are pulled by three competing forces just now.
Longest bull market in US history. Valuations, based on 10-year CAPE or Shiller average, have only been higher twice in market history: 1929 and 2000. Record earnings, which make stocks look cheaper, are starting to wobble. Economic policy is being made by tweet by a guy still in his jammies. Trade war. Brexit. $1,200,000,000,000 federal budget Continue reading →
I’m inured to stupid stories (“12% annual returns from a three-stock portfolio allow smart investors to retire at age 24 with $12 million!”) originating from “financial journalists” that no one has ever heard of. Those folks exist because the news hole has become a black hole.
The “news hole” is the amount of space, in a newspaper or magazine, or time, in a news broadcast, available for the news of the day. It used to be a constraining factor: if you only have 23 minutes (or 400 column inches) a day available, you had to make editorial judgments about what was Continue reading →
On May 21, 2019, Vanguard launched its Global ESG Select Stock Fund (VEIGX/VESGX). The fund is subadvised by Wellington Management. It is Vanguard’s fourth socially-screened product after FTSE Social Index (VFTSX), ESG U.S. Stock ETF (ESGV) and ESG International Stock ETF (VSGX). Vanguard funds sponge up money pretty promptly: Social Index, launched in 2000, has $5.6 billion but the domestic and international ETFs are under a year old and have gathered $570 million and $380 million, respectively. Morningstar likes them all.
Matthew Brancato of Vanguard claims the fund “is taking a distinctive approach to ESG investing, seeking long-term outperformance through the selection of companies that integrate leading ESG practices into Continue reading →
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 become available by mid-October.
Eighteen new funds, available just in time for Halloween! Spoooky!
Most of the buzz surrounds the new line of Avantis active ETFs. Avantis is the product of a collaboration between American Century Investments and long-time Dimensional Fund Advisor (DFA) managers. DFA probably invented Continue reading →
The ETF industry has continued to distinguish itself for its almost laughable me-tooism. The themes of the day are marijuana (ETFMG Alternative Harvest ETF MJ, AdvisorShares Pure Cannabis ETF YOLO, AdvisorShares Vice ETF ACT which splits time between tobacco, pot and alcohol, The Cannabis ETF THCX, Cambria Cannabis ETF TOKE, Amplify Seymour Cannabis ETF CNBS, Cannabis Growth Opportunity Corp CWWBF) and pets (and pet parents). There are even articles now on the top marijuana ETFs for 2019 and the best marijuana ETFs for conservative portfolios. Uhhh … note to conservative investors, (1) the oldest and largest of these ETFs substantially trails the Vanguard Total Stock Market over the past three years yet has triple the volatility and (2) possession of marijuana is still a federal crime. Continue reading →
Dear friends,
It’s not yet the height of summer, but it’s starting to feel like it at Augustana. Our summer classes, held only in June, have ended and the hubbub of the new year is still a distant cloud on the horizon. I visit campus to catch up on my reading – it’s what scholars do – and to pursue bits and pieces of administrative work for my dean. Rather than camp in my office all day, I wander around at lunchtime and recently discovered our always-bustling patio and picnic lawn look Continue reading →
Active ETFs are a sort of hybrid between more-traditional ETFs and actively-managed mutual funds. Like traditional ETFs, they trade on the secondary market which means that the advisor doesn’t need to keep cash on hand in order to meet day-to-day withdrawal needs. Some of the expenses traditionally borne by the advisor either don’t exist (ETFs have fewer shareholder reports than, by law, mutual funds do) or are shifted to the brokerage firm. They also offer a structural tax advantage: shareholders aren’t responsible for the yearly tax consequences (and record-keeping) of the manager’s moves; shareholders are taxed only when they Continue reading →
On May 23, 2019, Harbor Capital Advisors did a hard reset on Harbor International Small Cap (HIISX). Over its first three years, the fund’s returns trailed nearly three-quarters of its peers with only a tiny bit less volatility. Harbor chose to empanel a new subadvisor, Cedar Street Asset Management which was founded in April of 2016, is an employee-owned investment management firm and has $220 million in assets under management as of May 31, 2019. Since Cedar Street brings a distinct strategy that has little in common with their predecessors, MFO classifies this as Continue reading →
On April 30, 2019, Palm Valley Capital Management launched their first, and likely only, fund: Palm Valley Capital Fund (PVCMX). The managers are seeking long-term total return. The plan is to invest in a compact portfolio of high-quality, substantially undervalued small cap stocks.
Their goal is to provide “an attractive Continue reading →
This fund has been liquidated.
Matthews Asia Value pursues long-term capital growth by investing in a diversified portfolio of securities of undervalued companies from the Asian region. The target is firms that are high quality, undervalued with strong balance sheets, focused on their shareholders, and well-positioned to take advantage of Asia’s economic and financial evolution. The goal is to buy shares at a discount of 30% or more to their calculation of intrinsic value.
It is an all-cap portfolio, which translates to Continue reading →
Chip and I aspire to travel internationally once every two years. Our hope, in part, is to get far away from the noise long enough that we actually manage to unwind. Our ideal trips feature cool sites, the opportunity to sit and talk with people, and one outstanding meal a day. Two years ago that took place in Scotland, this year Ireland, and two years hence, Italy. Continue reading →
I write, frequently, with admiration and gratitude, about the contributions TheShadow makes both to our discussion board and to our final double-check of coverage in each month’s Briefly Noted column. For those wondering exactly how much cool stuff one person might extract from the swamp of SEC filings each month, here are The Shadow’s contributions for the month of June 2019.
The live, clickable version Continue reading →
Before funds and ETFs can be offered to the public, they’ve got to be submitted to the SEC which has 70 days to review the application. In general, advisers try to launch just before year’s end because that allows them to have clean “year to date” and calendar year results to share. The funds on-file this month will be eligible to launch in September, though not required to do so. A surprising number of advisors filed virtual “red herring” prospectuses: substantially incomplete documents that were pushed through to meet some self-imposed deadline but that fail to stipulate strategy, manager and costs.
There are a series of intriguing Continue reading →
“At a special meeting held on June 7, 2019, shareholders of Nuveen High Income Bond Fund did not approve the proposed reorganization of the Fund into TIAA-CREF High-Yield Fund that was previously approved by the Board of Directors of the Fund in December 2018 … the Board will review and take such action as it deems to be in the best interests of the Fund, including continuing to operate the Fund as described in the prospectus, liquidating the Fund, or such other options the Board may consider. Fund shareholders will be notified when the Board approves a course of action for the Fund.”
Shareholder democracy in action! The shareholders say “no” and Continue reading →
Dear friends,
Oops … I did it again!
On May 19, 2019, I helped launch my 35th cohort of Augustana grads on an unsuspecting world. With modest pomp, stirring music, one thoughtful address (that no one will remember) and one clunky one (likewise, thank God), I participated in the college’s 159th commencement. Afterward, by long tradition, the graduates filtered through the throng of faculty, exchanging tears and laughter, thanks and hugs.
And then they were gone. It’s bittersweet to have a career forever predicated upon bidding farewell to amazing young folks just as they hit their stride. They were a challenge, and they’re Continue reading →
At the time of publication, this fund was named Index Funds S&P 500® Equal Weight.
The fund equally weights all of the stocks in the S&P 500 index and rebalances its portfolio quarterly.
The Index Group, LLC, headquartered in Colorado Springs, Colorado. While they are Continue reading →
On May 31, 2019, Zeo Capital Advisors launched Zeo Sustainable Credit Fund (ZSRIX). The fund seeks to provide risk-adjusted total returns consisting of income and moderate capital appreciation. This marks the launch of Zeo’s second fund, after Zeo Short Duration Income (ZEOIX).
ZEOIX has performed exceedingly well over its eight years. The fund’s risk-adjusted returns have been best-in-class and its expenses have fallen. The limitation perceived by some of its major investors is that it is duration-constrained; that is, it doesn’t have the flexibility to pursue many attractive longer-duration opportunities. ZSRIX is designed to Continue reading →
