Category Archives: Mutual Fund Commentary

Of Centaurs and unicorns

By David Snowball

Zeke Ashton never met Brenda Barnes, so far as I can tell. That’s too bad. He had, sometime this fall, his Brenda Barnes Moment. I think he would have enjoyed talking with her about it.

Brenda Barnes was many things but, for the purpose of our story, she was one of the most powerful business leaders in America. She became COO of Pepsi-Cola in 1993 then president and CEO in 1996. Later, as president of Sara Lee, Forbes ranked her as the 8th most powerful woman in the world, just ahead of Oprah Winfrey (2005). That same year, Fortune ranked her third.

But Brenda was not just Continue reading →

Your 2019 funds watchlist: Draft #1

By David Snowball

It is exceedingly unlikely that your best options in the year and years ahead are going to look much like the winners of the past two years. That reflects, in part, the market’s unresolved turmoil and, in part, the fact that the market has been unmoored from reality of late. Commentators fear that “the sugar rush” provided by the Republicans’ indiscriminate tax cut will, at best, fade and, at worst, be followed by a “sugar crash” as the consequences of trillion dollar annual deficits, rising interest costs and global instability begin to hit home.

A quick snip from my most recent newsfeed:

Is Another Market Crash Coming?

The Latest Stock Market Crash Signal Is Blaring Out of Texas

A Market Crash Is Continue reading →

Briefly Noted

By David Snowball

Updates

In the three months from September through November, 2018, Morningstar registered 199 new funds. As it turns out, 190 of the 199 are additional share classes for existing funds. Think of share classes as marketing games: The American Funds, for example offer 17 share classes with, literally 17 different expense ratios ranging from 0.20% (529F shares) to 1.80% (529C shares). At base, the adviser creates new share classes as they cut distribution deals with various new constituencies.

Only nine, none of which I find Continue reading →

November 1, 2018

By David Snowball

Dear friends,

It’s fall.

By the oddity of scheduling, Augustana’s fall trimester ended just as it felt that fall had descended. My students decamped on November 1, numbed from long nights of study and challenging finals, anxious to get home for “some real food.” They leave behind a campus preparing itself, at long last, for the sere and snowy season to come. Continue reading →

Who won October?

By David Snowball

October was an exciting month for investors. By various reckonings, it was the worst month since September, 2011. US stocks declined by $2 trillion in value, with Amazon alone dropping $250 billion. It was so bad that Jeff Bezos reportedly had to postpone plans to buy several small countries. Global markets, equity and fixed-income together, shrank by $5 trillion. Unless you ask The Guardian, which tallies the global equity loss at $8 trillion.  That seems unnecessarily depressing (and unattributed), so I resolved not to ask Continue reading →

Launch Alert: Seven Canyons World Innovators

By David Snowball

It is rare that we issue a Launch Alert for a seventeen year old fund. Then again, it is rare that we find a 17 year old fund as remarkable as Seven Canyons World Innovators (WAGTX / WIGTX). World Innovators was launched on December 19, 2000 as Wasatch World Innovators. The fund, with its sibling Strategic Income Fund (WASIX), was rechristened with the new Seven Canyons identity on September 10, 2018.

Seven Canyons Advisors was formed in September 2017 with Continue reading →

Launch Alert 2A: RiverPark Floating Rate CMBS Fund

By David Snowball

On November 12, 2018, RiverPark Funds launches RiverPark Floating Rate CMBS Fund (RCRFX/RCRIX). Like several of RiverPark’s funds, RCRIX began life as a hedge fund (2010-2016). Unlike any of its predecessors, it originally converted into an interval fund, a sort of closed-end fund under which structure it operated for two years (RiverPark Commercial Real Estate Fund, 2016-2018) where investors only had quarterly liquidity. That fund began begin life with $50 million in assets from its private predecessor, of which $10 million is the manager’s own money. The newest package presents the fund as a traditional open-end mutual fund with daily liquidity and both retail (RCRFX) and institutional (RCRIX) share classes.

(Why “2A”? This is not only the second Continue reading →

Funds in registration

By David Snowball

Before funds can be offered to the public, they’ve got to be submitted to the SEC which has 70 days to review the application. That means that funds hopeful of launching by December 30th needed to be filed by October 15th. We’re looking for funds that might be accessible to the average investor or advisor; we include active ETFs but not passive ones. That last restriction allows me to pretend that neither ProShares Pet Care ETF nor the US Vegan Climate ETF is about to be inflicted on us. Continue reading →

Briefly Noted

By David Snowball

Each month we round up the bits and pieces of industry news, from name changes to fund liquidations, that strike us as consequential but not consequential enough to warrant a stand-alone story. Perhaps distracted by the market’s recent turmoil, advisers have authorized far fewer changes this month than in most over the past five years. Continue reading →

Nowhere to run to, nowhere to hide

By David Snowball

Good news: The US stock indexes are at, or quite near, all-time highs!

Bad news: The US stock indexes are at, or quite near, all-time highs.

Good news: the 3rd quarter of 2018 had the highest returns over any quarter in over five years!

Bad news: the 3rd quarter of 2018 had the highest returns over any quarter in over five years.

Good news: the advance in Continue reading →

Funds in Registration

By David Snowball

Before funds can be offered to the public, they’ve got to be submitted to the SEC which has 70 days to review the application. That means that funds hopeful of launching by December 30th need to be filed by October 15th. This month’s 15 new funds, including offerings from both DoubleLine and T. Rowe Price, represent the first part of that year-end wave. Continue reading →

Briefly noted

By David Snowball

The imminence of Halloween reveals itself in the deadened thud as the walking dead move toward the graveyard. Summer saw a curious lull in fund liquidations and manager changes both, but the end of summer is ending that reprieve. Our mid-September and October issues recount 70 obituaries, the vast majority of which were announced in the past 30 days. A precious few were high-performing funds that couldn’t attract attention. There seems to be a pattern in the remainder: lots of funds designed to Continue reading →

When the facts change, I change my mind. What do you do, sir?

By David Snowball

Investors are forever willing to panic themselves at the prospect that their managers have taken Stupid Pillstm. The presumed signs of ingestion: any period of relative underperformance, pretty much without regard to absolute performance, the brevity of the period, its cause or the appropriateness of the peer group.

The automatic urge: running away, either to cash or to an investment with eye-catching recent returns.

Which is, by Continue reading →

Briefly Noted

By David Snowball

The imminence of Halloween reveals itself in the deadened thud as the walking dead move toward the graveyard. Summer saw a curious lull in fund liquidations and manager changes both, but the end of summer is ending that reprieve. We’ve tracked 33 obituaries for this issue. A few were high-performing funds that couldn’t attract attention. There seems to be a pattern in the remainder: lots of funds designed to hedge against market volatility, lots of funds designed to hedge against rising prices and a few more funds with exposure to emerging markets. A fusty old curmudgeon might note that liquidations in a category peak at the moment of maximum Continue reading →

August 5, 2018

By David Snowball

Dear friends,

Thanks for your patience. The end of July and beginning of August brought a bunch of challenges.

This month’s issue has a lot of interesting content; just not quite so much as we’d planned. With luck, we’ll shift the vast bulk of it to September.

Zoom in to Charles and the MFO Premium walk-through

MFO Premium offers a ridiculous wealth of information for a Continue reading →

Launch Alert: Fidelity ZERO Total Market Index Fund (FZROX) and Fidelity ZERO International Index Fund (FZLIX) 

By David Snowball

We’ve got Coke Zero. We’ve got Pepsi Zero. I guess it’s reasonable to wonder, why not Fidelity Zero?

Wait, we don’t have Coke Zero or Pepsi Zero. They both failed in the marketplace and had to be reformulated, renamed and relaunched.

But we do have Fido Zero.

On August 3, 2018, Fidelity launched two zero/zero index funds sporting zero Continue reading →