MMNIX - Miller Market Neutral Income Fund You may be getting misled by its extremely short history. Eyeballing its
performance graph at M*, it looks like it tracked the entire (20 fund) category pretty closely. That is, the 1.6 std dev is not something special for this fund, but rather it is typical of the whole category over this short time span.
Here's a
Portfolio Visualizer comparison of MMNIX with two other relative value arbitrage funds. The other two funds, LEOIX and PSCAX have had no negative months in the same 16 month span.
LEOIX does have a slightly higher std dev (1.7), but has a 12.05% annualized return vs. 9.63% for MMNIX. This results in a Sharpe ratio of 3.76 vs. 2.75 for MMNIX.
PSCAX has a lower std dev of 1.45, but one pays for that with a lower annualized return of 8.23% and a lower Sharpe ratio of 2.16.
If you want to get a sense of what to expect from this fund over a significant period of time, you could look at how these other funds performed. Over ten
years, they've each returned 3.9% annually, give or take a few basis points (per Fidelity).
One doesn't need to look at alternatives for funds that offer a smooth a ride and decent performance. Here's a
Fidelity comparison of PRFRX with LEOIX and PSCAX. PRFRX has outperformed PSCAX over 3, 5, and 10
years with a similar 3 year std dev. Its performance longer term is comparable to LEOIX with a 3 year std dev that's about 1/3 lower. And half the cost (ER) of both.
Moody's Downgraded US Debt From Aaa to Aa1 "The coddled, spoiled, under-taxed wealthy have effectively been cannibalizing the rest of us for many years."
H'mmm... some good points. I wonder if maybe ol' FD fits in there someplace? That might account for his silence here.
Moody's Downgraded US Debt From Aaa to Aa1 “Over the next decade, we expect larger deficits as entitlement spending rises while government revenue remains broadly flat,” said Moody’s. “In turn, persistent, large fiscal deficits will drive the government’s debt and interest burden higher. The US’s fiscal performance is likely to deteriorate relative to its own past and compared with other highly rated sovereigns.”
The coddled, spoiled, under-taxed wealthy have effectively been cannibalizing the rest of us for many years. Extension of the 2017 tax cut will simply accelerate that process. Current federal "leadership" in all three branches of gummint have created of s-hole country here already. On the current trajectory, we'll just slide deeper into the toilet. Misguided public priorities, misappropriated money, and the LACK of public funds available show up in so many ways: still no universal medical coverage. Still, we have antiquated mass transit. Still, the schools graduate kids who can't read and function and think. If there is a single decent lesson to be learned from the current regime, it's that gov't no longer is actually responsive to people's needs--- but not because there is some weird-ass "deep state" conspiracy.
Moody's Downgraded US Debt From Aaa to Aa1 As I wrote before, Moody's is late to the party. In that sense, Bessent is correct that Moody's is a lagging indicator. However, Moody's is also correct that there has been an "increase over more than a decade in government debt and interest payment ratios to levels that are significantly higher than similarly rated sovereigns.”
The "more than a decade" that Moody's is looking at started in 2013 when Congress, with bipartisan support, made the Bush tax cuts permanent.
Right through 2012, the Congressional Budget Office (CBO) was projecting declining debt through 2037 (25
years).
Under the extended baseline scenario, which generally adheres closely to current law, federal debt would gradually decline over the next 25 years—from an estimated 73 percent of GDP this year to 61 percent by 2022 and 53 percent by 2037. ...
...
The budget outlook is much bleaker under the extended alternative fiscal scenario, which maintains what some analysts might consider “current policies,” as opposed to current laws. Federal debt would grow rapidly from its already high level, exceeding 90 percent of GDP in 2022.
https://www.cbo.gov/publication/43288In 2013, after making the Bush tax cuts permanent, the CBO offered this outlook:
CBO produced an extended baseline for this report that extrapolates those projections through 2038 (and, with even greater uncertainty, through later decades). Under the extended baseline, budget deficits would rise steadily and, by 2038, would push federal debt held by the public close to the percentage of GDP seen just after World War II—even without factoring in the harm that growing debt would cause to the economy.
...
[U]nder the assumptions of the extended baseline, CBO projects [b]y 2038, the deficit would be 6½ percent of GDP, larger than in any year between 1947 and 2008, and federal debt held by the public would reach 100 percent of GDP, more than in any year except 1945 and 1946. With such large deficits, federal debt would be growing faster than GDP, a path that would ultimately be unsustainable.
https://www.cbo.gov/publication/44521Moody's did not pull "over a decade" out of a hat because a decade sounds like a nice round number. It started at 2013 for a reason. And now, even without extending the Trump tax cuts, CBO is projecting deficits to run around about 6.1% of GDP annually over the next decade. That's not much less than 6½ and likewise unsustainable.
Any good sources for CEF performance in 2008? / Question answered. Thanks all! And the knowledge gained in all things financial over the years has allowed us to award our own degrees in 'economics' to ourselves. :) We've been able to share and pass along the knowledge. Compound, compound, compound !!!
Yes. I’ve learned so much from the highly capable informed investors here over the
years.
And a plug for
The Humble Investor by Daniel Rasmussen which
@Observant1 shared here recently. I listen to the audio book most nights. His take isn’t mainstream. His idea of smart investing is to avoid whatever’s been hot and seek out underappreciated areas. And he admits that it hasn’t worked that well in recent
years. But an interesting conversation nonetheless.
I infer from Rasmussen that he perceives
a lot of bubbles, especially in the private equity area - but late night listening isn’t always accurate and he’s pretty subtle.
Reality check (closed, this has sort of run its course) I've been active on several investment sites for over 15 years, and MFO stands out as one of the best.
It’s a unique platform with valuable insights, thoughtful discussions, and a long-standing community. Unfortunately, it's also the only investment site I’ve seen where political posts—by a huge margin from one side of the aisle—have hijacked the conversation and driven incivility to the forefront. No other investment forum I follow has experienced this to the same extent.
This site has been read and respected by hundreds over the years. Every few weeks, I make an effort to help bring back the original spirit of MFO—an investment-focused space grounded in respectful, insightful dialogue.
Moody's Downgraded US Debt From Aaa to Aa1 Moody's downgrade of U.S. government debt is kind of a non-event.
The other two major credit rating agencies already downgraded this debt years ago.
However, we should heed Moody's rationale.
Here is their rationale, in part:
"Over more than a decade, US federal debt has risen sharply due to continuous fiscal deficits.
During that time, federal spending has increased while tax cuts have reduced government revenues.
As deficits and debt have grown, and interest rates have risen,
interest payments on government debt have increased markedly."
"Without adjustments to taxation and spending, we expect budget flexibility to remain limited,
with mandatory spending, including interest expense, projected to rise to around 78%
of total spending by 2035 from about 73% in 2024. If the 2017 Tax Cuts and Jobs Act is extended,
which is our base case, it will add around $4 trillion to the federal fiscal primary
(excluding interest payments) deficit over the next decade."
"Underpinning the rating is our assumption that the US' institutions and governance will not materially weaken,
even if they are tested at times. In particular, we assume that the long-standing checks and balances
between the three branches of government and respect for the rule of law will remain broadly unchanged. In addition, we assess that the US has capacity to adjust its fiscal trajectory,
even as policy decision-making evolves from one administration to the next."
Any good sources for CEF performance in 2008? / Question answered. Thanks all! Hi
@Mark Thank you.
Total Return link is interesting and useful.
We've always performed simple math for inflation and eventual taxation of our investments and what the 'real return' will become.
In the pre-internet days with access to data via the WSJ and Baron's, I used 5% for annual inflation impact to be ahead of the curve (hopefully). The was during the period of some very serious inflation for many of we 'older' investors.
However, equity/bond investing has provided more than the bank/cu accounts so many folks have used for many
years. And the knowledge gained in all things financial over the
years has allowed us to award our own degrees in 'economics' to ourselves. :) We've been able to share and pass along the knowledge.
Compound, compound, compound !!!
Remain curious,
Catch
Violent Attacks Rattle Crypto Elite
yes, crypto crime utility has many years of growth ahead, boosted with support by politicians and traditional institutions that want a cut of transactions..
criminal 'B2B' volume dwarfs all other activity, and probably most nations' currency.
Moody's Downgraded US Debt From Aaa to Aa1
Private-Equity Wants a Piece of Your 401(k)
Other than TIAA RE, which has proven itself over the
years, I think Jason is spot-on correct, as I mentioned earlier. The average person is not in a position to research (or understand) the nuances and intracasies of illiquid investments ... heck, most people have no idea about things like 'fundamentals' or 'moats' or whatnot when it comes to just buying *stocks*.
