Category Archives: Mutual Fund Commentary

June 1, 2021

By David Snowball

Dear friends,

Welcome to summer.

On the morning of Sunday, May 23, Dean Wendy Hilton-Morrow sent the following short email from the floor of the convention center in which our commencement was held.

Subject: It’s showtime!

The stage is set.

The players are gathering, nervously, outside. Over the next eight hours we’re going to celebrate Continue reading →

Launch Alert: Alger 35 ETF

By David Snowball

On May 4, 2021, Fred Alger Management launched the Alger 35 ETF (ATFV), their second active/nontransparent ETF (known colloquially as an ANT). The fund will invest in 35 stocks, typically US, typically mid- to large-cap (98% of the portfolio), and uniformly high growth.

Alger was founded in 1964 as a growth investor with all of its strategies using the same underlying discipline that focused on Continue reading →

Tactical Sleeve for the Conservative Minded

By Charles Lynn Bolin

Momentum is contrasted with “Buy and Hold” to develop a Tactical Sleeve. The objective is to increase risk-adjusted returns and benefit from the evolving business cycle.

I have written articles on Mutual Fund Observer about investing according to the business cycle, fund rotation, and trend following as well as finding funds that manage risk over the complete business cycle. As an individual investor nearing retirement, I like to evaluate Continue reading →

Briefly Noted

By David Snowball

Updates

The fund-to-ETF train appears to be leaving the station.

On May 7, 2021, the Adaptive Growth Opportunities Fund became the Adaptive Growth Opportunities ETF.

At some time in the third quarter of 2021, Water Island Long/Short Fund will become the AltShares Event-Driven ETF. That’s a more convoluted change since the fund will change Continue reading →

May 1, 2021

By David Snowball

Dear friends,

The Tenth Year … and the Ninth Inning

Ten years ago this month, we launched the first issue of the Mutual Fund Observer, “a site in the tradition of FundAlarm.” As the antiquated text below notes, FundAlarm was one of the industry’s most independent, critical voices for 15 years, from 1996-2011. I had the privilege of writing for FundAlarm over its last five years. While the publisher and curmudgeon-in-chief Roy Weitz knew that his time was drawing to a close, he and over 100 readers were sure that the mission of FundAlarm – to be a thoughtful voice and unabashed champion of “the little guy” – was not.

And so the Mutual Fund Observer was born. Continue reading →

Hacking through the green wilds

By David Snowball

It’s become increasingly clear that the global climate is becoming dangerous. Google Earth now has a time-lapse feature that allows us to watch changes in the planet – from the disappearance of glaciers to the drying of the Aral sea to the disappearance of Brazilian rainforests – over the past 37 years. The West and Southwest are locked in drought with record-low reservoir levels. Atmospheric CO2 is at its highest level in 650,000 years with the 20 hottest years in recorded history all occurring since 1998.

But you knew that already. Increasingly we (young and old, liberal and conservative, individual and corporation) accept that we’re in Continue reading →

One Stop Shop Mutual Fund Options With Good Multi-Year Metrics

By Charles Lynn Bolin

One Stop Mutual Funds with Good Multi-Year Metrics (CTFAX, FMSDX, JABAX, PRSIX, RBBAX, TRRIX, VTINX, VWINX)

As I imagine retirement in a few years here, my personal investing goals have been to simplify. I built my Ranking System around MFO Metrics to determine the best funds for a conservative investor nearing retirement considering long-term performance, momentum, consistency, downside volatility, risk-adjusted returns, quality, and income. These funds are in line with my preference to have Continue reading →

A decade on: Artisan Global Value (ARTGX)

By David Snowball

What they do

The managers pursue long-term growth by investing in 30-50 undervalued global stocks.  Generally, they avoid small-cap stocks but can invest up to 30% in emerging and less developed markets. The managers look for four characteristics in their investments:

  1. A high-quality business
  2. With a strong balance sheet
  3. Shareholder-focused management
  4. Selling for less than it’s worth.

The managers can Continue reading →

A decade on: LKCM Balanced (LKBAX)

By David Snowball

What they do

The managers invest in a combination of US blue-chip stocks, investment-grade intermediate-term bonds, convertible securities, and cash. There’s a bit more mid-cap exposure than their peers offer but noticeably less direct international exposure. In general, at least 25% of the portfolio will be bonds. In practice, the fund is generally 70% equities. The portfolio turnover rate is modest, typically Continue reading →

A decade on: Osterweis Strategic Investment (OSTVX)

By David Snowball

What they do

Osterweis starts with a strategic allocation that’s 50% equities and 50% bonds. In bull markets, they can increase the equity exposure to as high as 75%. In bear markets, they can drop it to as low as 25%. Their argument is that “Over long periods of time, we believe a static balanced allocation of 50% equities and 50% fixed income has the potential to provide investors with returns rivaling an equity-only portfolio but with less principal risk, lower volatility, and greater income.” Because they don’t Continue reading →

Briefly Noted

By David Snowball

Updates

A Gold medal for T. Rowe Price: Morningstar has upgraded their assessment of T. Rowe Price’s Retirement Series funds to Gold, their highest endorsement. It’s an endorsement we share. Twenty-four of T. Rowe Price’s funds – including many of the retirement date funds – earn our “Great Owl” designation for consistently top-tier risk-adjusted-performance. We have recognized the firm Continue reading →

April 1, 2021

By David Snowball

No one knows quite when the April Fool’s (or All Fool’s) tradition arose. The internet is rife with simple, self-assured explanations that are flawed only by the fact that they’re wrong. “Attestations,” that is, contemporary historical recordings referring to the event, are scarce and most of the explanations (“it’s all about the Gregorian calendar in France!”) fail to account for all of the observed behavior.

My preferred speculation: spring,  it felt like a good time to do silly things.

Huge swaths of the Continue reading →

Right Beneath My Nose

By Charles Lynn Bolin

VictoryShares Enhanced Volatility Weighted ETF (CDC), a Great Owl with an Eye on Volatility

Each month, I sift through funds in my Ranking System, as well as trending funds, using the Mutual fund Observer MultiSearch screen. I search for high risk-adjusted returns across many asset classes for diversification. In March, I discovered VictoryShares Enhanced Volatility Weighted ETFs right under my nose. In this article, I look at the difference between low volatility funds and funds with high-risk adjusted returns.

 This article is divided into sections for those who wish to Continue reading →

The case for a stock-light portfolio, version 4.0

By David Snowball

“Stocks for the long-term!” goes the mantra. That chant has two meanings: (1) in the (very) long-term, no asset outperforms common stock. And (2) in any other term, stocks are too volatile to the trusted so if you’re going to buy them, be sure you’re doing it with a long time horizon.

My own non-retirement portfolio, everything outside the 403(b), embeds a healthy skepticism about stocks. The strategic asset allocation is always the same: 50% equity, 50% income. Equity is 50% here, 50% there, as well as 50% large and 50% small. Income tends to be the same: 50% short Continue reading →

Launch Alert: T. Rowe Price Global Impact Equity

By David Snowball

On March 15, 2021, T. Rowe Price launched T. Rowe Price Global Impact Equity (TGPEX).

Socially responsible investing is all the vogue, and for good reason. The great bulk of such funds have a limited mandate: do no evil. They’re not trying to change the world, they’re just charged with avoiding the worst actors in it.

A minority of funds accept a greater Continue reading →

Briefly Noted

By David Snowball

Updates

On March 26, 2021, Guinness Atkinson Asia Pacific Dividend Builder Fund (GAADX) and the Guinness Atkinson Dividend Builder Fund (GAINX) were converted into ETFs.

Following the model pioneered by GA, Adaptive Fundamental Growth Fund, Adaptive Hedged High Income Fund, Adaptive Hedged Multi-Asset Income Fund, Adaptive Tactical Outlook Fund, and Adaptive Tactical Rotation Fund are being converted into the Adaptive Fundamental Growth ETF, Adaptive Hedged High Income ETF, Adaptive Hedged Multi-Asset Income ETF, Adaptive Tactical Outlook ETF, and Adaptive Tactical Rotation ETF, respectively.

DFA, the other firm Continue reading →

March 1, 2021

By David Snowball

Welcome to spring!

Virtually.

I first knew that spring had arrived – despite the day’s sub-zero temps – when I noticed that my students weren’t blinking anymore. The cheerful banter and occasional sass of my January term class is a chapel-like silence. Sitting in orderly rows, they look neither right nor left but smile in bland detachment. Footwear begins to shift from winter’s stylish combat boots to sneakers and sandals. The Bold celebrate a 45-degree day by donning shorts and carrying a light jacket over their arms (while The Old stays sensibly zipped up and suspicious of youth and weather both).

I can’t verify that their “fancy lightly turns to Continue reading →

Inflation, Trends, and Market Manipulation

By Charles Lynn Bolin

This past week has seen some significant market turmoil as the yield on 10-year treasuries climbed quickly to 1.5% while the S&P 500 dipped 2.5% on Thursday, February 25th. I show the Moving Average Convergence Divergence indicator below. The trends are short-term bearish. In this article, I focus on funds that lost less than a half percent on Thursday and were trending up over the past several months for clues on where to invest with the possibility of inflation rising.

This article is divided into four sections for those Continue reading →