A tradition dating back to the days of FundAlarm was to annually share our portfolios and reflections on them with you. My portfolio, indolent in design and execution, makes for fearfully dull reading. That is its primary charm.
2022 was replete with adventures and surprises: Continue reading →
On January 11, 2023, Matthews Asia launched Matthews Emerging Markets ex China Active ETF (MEMX). It is an actively managed ETF that might invest in every country in the world except China, the United States, Australia, Canada, Hong Kong, Israel, Japan, New Zealand, Singapore, and most of the countries in Western Europe.
Our January issue originally, and mistakenly, suggested that the fund had launched on 12/31/2022. That was corrected as soon as Matthew’s representatives let us know of the error. Our regrets!
The fund will be Continue reading →
Dear friends,
Welcome to winter.
Dame Edith Sitwell, a poet and crank, observed, “Winter is the time for comfort, for good food and warmth, for the touch of a friendly hand and for a talk beside the fire: it is the time for home” (Taken Care Of: An Autobiography (1965)).
How could you not be drawn to someone who said of herself, “I am not eccentric. It’s just that I am more alive than most people. I am an unpopular Continue reading →
I have no idea what the best investment of 2023 will be, and neither does anyone else. The annual exercise in futility and fantasy is well underway in the financial press and market pundit community, notwithstanding the fact that their 2022 forecasts were laughably wrong, as were their 2021, 2020, 2019 …
Section 1, The Terrified Investor
Section 2, The Exhausted Investor
Section 3, The Enterprising Investor
If you’re obsessed about 2023, our best advice is Continue reading →
The central function of financial innovation seems to be to separate you from your wealth. There are some honorable exceptions – low-cost broad-based index funds surely among them – but those are exceptional. Recently bright people, some with incredibly flexible moral standards, have offered you new opportunities to enrich them. The appeal of each of these hustles is the same: it’s different this time! We’ve got the secret! And we’re willing to let you in on it.
Here are three examples of things you don’t need. Continue reading →
Dear friends,
Welcome to the darkest and brightest season of the year. Each year we share the reminder of a long and resolute human impulse: to stare into the gathering gloom, frozen fields, and biting winds and to declare, “we will not surrender to the darkness, within or without. Light the fires, summon the family, call our friends and set the table. Tonight, we rejoice together.” Continue reading →
On December 31, 2019, Oelschlager Investments launched the Towpath Focus Fund (TOWFX). The fund invests in 25-40 domestic stocks regardless of market capitalization. The fund is managed by Mark Oelschlager.
Towpath is a concentrated, all-cap equity fund. The portfolio currently holds 41 securities. About 15% of the portfolio is invested in non-US stocks and 12% in cash. Compared to its Morningstar peers, the fund has more cash, more international, and more small-cap exposure. The portfolio stocks are higher growth companies (measured by sales, cash-flow, and book value growth) that sell for lower prices (measured by price-to-book, price-to-earnings, and price-to-sales) with higher returns than either their peers or their index. Continue reading →
On September 1, 2022, Fidelity launched Fidelity Hedged Equity (FEQHX) which is also available in five Fidelity Advisor share classes.
The goal is Fidelity Hedged is to provide capital appreciation. Presumably, it’s also to provide capital appreciation with less volatility than the stock market, hence the “hedged” piece. The strategy is to invest in an S&P 500-like stock portfolio. That means some growth and small value but mostly large cap. The managers then apply “a disciplined options-based strategy designed to provide downside protection” mostly by buying put options, which appreciate when the relevant underlying asset depreciates. Generally, the hope is Continue reading →
On behalf of my Celtic forebears, happy New Year! November 1 marks the traditional beginning of the Celtic year at a fire-rich festival called Samhain (or Samhuinn or something like it). It’s a curious cultural choice: the old year ends with the harvest, and the new year begins “the darker half” of the year, a period of confinement and, frequently, gnawing hunger.
On whole, the Romans chose the bright path: they began the year around March 1st when the first hopeful sprouts of spring appeared. The Celts, made of sterner stuff, looked the darkness Continue reading →
Dear friends,
Our hearts go out to people around the world whose lives are being wracked by forces beyond their control, whether that’s the madness of dictators or the ravages spawned by the world’s increasingly unstable climate. Those folks represent needs far beyond the annoyance caused by our collective loss of $9 trillion in the stock market’s ongoing revaluation.
Those of us only indirectly affected by such tragedies have three imperatives:
An impending civil war in the US. A planet on fire. The worst drought in 1500 years. The prospect of Putin using nuclear wars in Europe. A market decline that might be accelerating rather than slowing. Inflation at 40-year highs. Crazy people storming the Capitol. Voter restrictions. Politicians increasingly willing to assert control over women’s lives. Continue reading →
William Blair Emerging Markets Small Cap Growth (WESNX) is a purely outstanding offering. You might or might not be able to buy it.
You might: Morningstar and Lipper both report that the fund is open to Continue reading →
Dear friends,
Welcome to the end of summer. Traditionally, in the markets and on college campuses, it’s a quiet time of year. Trading volumes drop, traders and sensible people alike flock to beaches, and facilities crews at colleges like Augustana work 12-hour days trying to address all the issues that can’t be dealt with in a college jammed with people.
But come this first weekend of September, a new chapter begins … Continue reading →
Harbor International Small Cap Fund pursues long-term growth by investing in a diversified portfolio of international small-cap stocks. They have three particular preferences:
Disciplined Growth Investors pursue both long-term growth and modest current income at reasonable risk. Approximately 65% of the portfolio is invested in stocks and approximately 35% in bonds and cash. The managers can gradually shift equity exposure down to about 55% or up to about 70% if market conditions warrant.
The managers invest primarily in smaller US stocks, currently defined as those with market capitalizations between $1 billion and $15 billion. They “don’t mindlessly diversify across every market, sector, and asset class.” They focus on Continue reading →
Dear friends,
Chip and I escaped for a bit this month. We headed northeast to Door County, the peninsula that extends above Green Bay, Wisconsin. Like the Dingle Peninsula in Ireland, Door County represents “my happy place.” For folks unfamiliar with it, imagine a less commercialized version of Cape Cod: water on both sides, farms in between, cherries everywhere, no chain restaurants at all, and a series of small lakeside or bayside towns whose permanent populations number in the hundreds.
Here was the plan: disconnect from the outside world, Continue reading →
Dear friends,
As you read this, Chip and I will be on vacation in Door County, the idyllic peninsula just north of Green Bay, Wisconsin. While I’m sure there have been years when she and I more needed time away, I surely cannot remember when. I was introduced, this year, to the term “trauma-informed pedagogy” and to the realization that perhaps three-quarters of our young people have taken a few more hits than they’re currently capable of managing.
Having managed their mental health for the past year, we’re going to work on our own for Continue reading →
FPA New Income (FPNIX) is a remarkable fund, simultaneously conservative and aggressive. It is an absolute return-oriented fixed income fund that embodies FPA’s corporate discipline: don’t buy it if you don’t have a margin of safety and the prospect of decent returns. The explanation of the fund’s investment strategy begins with a simple declaration: “We do not like to lose money.” It is simultaneously an unconstrained and a very constrained strategy. It is unconstrained in that it can invest pretty much wherever opportunities arise though at least 75% of the portfolio investments must earn the “High Quality securities” designation, with the remainder likely in cash or Credit Sensitive issues. It is very constrained, though, by a long-standing and non-negotiable absolute Continue reading →
Many and many a year ago, in the kingdom of ABC, Woody Allen was one of my very first guests. And we consented to take questions from an eager audience of mostly young people. Like ourselves.
The questioner looked like a high school girl and shouted to Woody from the balcony, “Do you think sex is dirty?”
Allen: “It is if you do it right.”
(Dick Cavett, “As the comics say, These kids today! I tell ya.” New York Times, 9/13/2013)
I’d rather hoped Continue reading →
Dear friends,
Welcome to June and the unequivocal beginning of summer. I celebrated my 38th set of Augustana graduates.
Those of you who attend professional sports events think you’ve experienced “the roar of the crowd.” Pfah. Until you’ve been there on the moment when a young person becomes the first member of their family, ever, to earn a college degree, you’ve heard nothing.
I also bade farewell Continue reading →
