My takeaway is to watch whether Berwyn Income Fund, with current AUM in the neighborhood of $1.7B, will become an asset gatherer for the acquiring firm.
Most striking was a phrase in the TriState Capital Holdings (TSC) release that its subsidiary, Chartwell, hoped to "meaningfully accelerate growth in client assets..."
That's never a good sign. (Remember, Berwyn Income Fund closed in 2010-2011, when it could not find new investment opportunities)
As for Berwyn, it says neither the objectives, invest team or process will change. And it says "total fund expenses are to remain unchanged for two years."
***
Also, the offerings of Berwyn and Chartwell appear somewhat redundant.
Chartwell's two mutual funds: small cap value (CWSIX-$1.7B market cap) and short duration (CWFIX- mostly BB-rated corporate bonds).
Berwyn: Berwyn (BERWX-$620m market cap) and Berwyn Income (BERIX- >%50 corporate bonds, BBB to B )
I presume the acquisition settles succession issues for the boutique firm - Berwyn CEO and president Robert Killen, and the principals are well acquainted, only a few miles apart out on the Main Line of Philadelphia.

In my understanding from reading the investing habits of the politicians over the years, they just suck at it or aren't relevant to retail investors. One, they don't have the time because they are busy raising funds. Two, most are independently wealthy enough that they can have asset managers take care of it at obscene fees and not suffer for it. Three, some of them actually worry about conflicts of interest (ok, I can hear the snickering from readers) to be at arm's length.
Interestingly enough, there seems to be a significant difference in who manages assets for the wealthy between east coast and west coast. While GS, MS, etc may be in fashion for old money on the West Coast, almost all of my interactions with West Coast wealth (in raising angel funds and providing company financials and valuations for their records) has been via accounts managed by either Merrill Lynch or Charles Schwab advisors, none so far with the tradional investment banks. Many of them with independent financial advisors that use these platforms.

Hi Dex,
I am surprised by the “lamppost” quote that you attributed to John Murphy. He is a longtime committed technical analyst who has authored several fine market technical analysis books. I met him several times a few years ago, and he is a true believer of the technical analysis approach to investing success.
I have been exposed to the lamppost saying several times, and I suspect it would be more appropriate to credit it to baseball announcer Vince Scully. I suspect the quote is dripping with sarcasm. It is witty but is not real wisdom. I prefer the quote from George Bernard Shaw: “It is the mark of a truly intelligent person to be moved by statistics,”
Certainly statistics can be handled badly and misused to distort the results, to corrupt the actual findings. These are perversions that can be detected by numbers detectives.
The marketplace is awash in data. It is overwhelming. Statistics are simply a way to organize that data, and graphs are simply a way to succinctly present that data. Statistics and their graphs are useful tools to help the decision making process.
How do you choose a fund manager? I do seek low costs, but I’m also guilty of seeking and choosing a manager who has an impressive record compared to a number of applicable benchmarks.
When a baseball manager selects a pinch-hitter, he is likely to consult the past records of his hitter options against the current pitcher. When I cross a street against the light, I subconsciously assess the likelihoods of getting hit by the oncoming traffic. There are endless examples of everyday application of statistics, both consciously or subconsciously.
Statistics not only matter, they matter greatly in most of life’s decisions.
Thank you for your comments. I’m sure they attracted attention, and I want as many MFOers as possible to have the opportunity to consider the referenced J.P. Morgan resource. It’s a treasure chest of market data that are nicely summarized in a chart format.
Best Wishes.

Please focus on the summary chart presented on page 10 of the referenced document. It shows S&P 500 returns dating from 1980. The most compelling aspect of the Figure is that it demonstrates “S&P 500 intra-year declines vs. calendar year returns” for each of these recent 36 years. That’s enough data to be statistically relevant. This is a keeper chart.

From the debts of a terrible recession and including the longest (?) bull market in history of the US stock market, is not statistically relevant.
Investors' axiom: The value of analysis is inversely correlated to the number of charts used.
Statistics (charts) are used much like a drunk uses a lamppost: for support.
Encyclopedia of Chart Patterns, John Murphy.

Hi Guys,
Much has been written and discussed relative to the miserable equity market performance year to date. We’ve experienced such sad performance many times historically, but not at the opening bell announcing a new year. Does this signal an exceptionally unhealthy year for the market?
Maybe, maybe not! Projecting equity returns is an art/science mixture that not many folks have mastered. Certainly not me, and certainly not many of the acknowledged experts. That too is sad, but statistically true.
A few seasoned and wise investors caution us not to be over-reactive to this dire start. Don’t allow concern to turn into fear to morph into panic.
Market volatility has long been the bogeyman that promotes profit losing decisions for investors who can’t simply “do nothing”. Often, just standing still is a proper response. Why? Because volatility is just an embedded characteristic of the marketplace. There is plenty of evidence that supports extreme volatility within an annual market cycle.
Here is a Link to a J.P. Morgan report that provides a serious historical perspective:
https://www.jpmorganfunds.com/blobcontentheader/202/900/1158474868049_jp-littlebook.pdf
It is J.P. Morgan’s annual report on “A Guide to the Markets” for 2016. The report incorporates many charts that an investor might find helpful in quelling fear and panic. If you are even mildly statistically inclined, you’ll love the presentation material. It is a gold mine of useful data. You get to interpret these terrific data charts based on your own experiences, goals, preferences, and biases.
Please focus on the summary chart presented on page 10 of the referenced document. It shows S&P 500 returns dating from 1980. The most compelling aspect of the Figure is that it demonstrates “S&P 500 intra-year declines vs. calendar year returns” for each of these recent 36 years. That’s enough data to be statistically relevant. This is a keeper chart.
Note the 27 years of positive annual equity returns and compare the returns columns to the “red dots”. The “red dots” denote the intra-year decline during each year.
If you were an especially loss adverse investor, it is likely that you might have abandoned the S&P 500 even when the annual reward was highly positive by year’s end. Market volatility or noise could have frightened you to make a rash, imprudent decision. The courage to staying the course during these years was well rewarded.
Note also the rather subdued downside volatility recorded over the last 5 or 6 years. The behavioral wizards might suggest that the recency bias from those experiences has preconditioned a worried investor to be overly reactive as volatility reestablishes itself once again.
I sure can’t predict what the market returns will be this year. But the referenced J.P. Morgan curve suggests that some patience is warranted. Market volatility is now high, and that by itself could be a warning signal. Conflicting signals are the rule and not the exception in the investment world. That contributes to risk, and that’s precisely why there is an equity premium of 5 to 6 percent.
Stay cool, stay healthy, and stay the course. I plan to do all three. Unfortunately, plans, execution, and outcomes often diverge.
Honestly, you likely need more than the J.P. Morgan report, but I wanted your attention. Sorry for the exaggeration, but I didn't want you to miss this really good stuff.
Best Regards.

BUFSX was a really nice fund for many years when it first started out. I was drawn to their investment thesis based on demographic shifts, and it worked for many years....until it didn't.

Hi @heezsafe
I find these numbers (M* performance link below) to be in line for 2015 and 1 year total return numbers.
Placement of this fund to other similar funds still finds performance to be very good, eh?
One could have and some have done much worst in this bond category for the past 1, 3 and 5 years returns.
http://performance.morningstar.com/fund/performance-return.action?t=PIMIX&region=usa&culture=en_US
Regards,
Catch

High Yield Energy: Fear+ Forced Selling = More of the Same ?
Bond Funds Remain Confident as Crude Rout Worsens
Published January 20, 2016 Markets Reuters
More investors may lose patience in the contrarian bet and pull their money, forcing managers to sell energy credits to raise cash, said Jeff Tjornehoj, head of Americas research at Lipper.
Big bond investors who have bet on high-yield oil producers are sticking to losing bets, waiting for a turnaround in the price of crude, even though their performance has suffered and fund assets have shrunk as oil has plunged.
"We have not capitulated in this down trade," Buchanan said. He said it was "just a matter of time" before oil producers would begin to significantly cut back production. He said he would rethink his energy exposure if he saw more compelling yield opportunities in sectors other than energy.
Western Asset Short Duration High Income Fund SHIAX
Investors pulled $348 million from Buchanan's fund last year, cutting its assets to $700 million from a peak of $1.5 billion in June 2014, Lipper data shows. The fund has lost 4 percent this year.
EVBAX
Gaffney increased her exposure to energy bonds overall in the fourth quarter from 11.2 percent to 16 percent, with the fund's bets on high-yield energy bonds increasing from 3.3 percent to 5.8 percent.
She reiterated a call she made in October to Reuters that a number of her fund's holdings could gain by 30 percent or more over the next two years.
Investors pulled $856 million from Gaffney's fund last year, slashing the fund's assets by over 40 percent to $780 million from a peak of about $2 billion last February, according to Lipper data. The fund has lost 6.5 percent this year.
BJBHX
Aberdeen Asset Management, said the Aberdeen Global High Income Fund cut its exposure to energy overall to 7.3 percent and to high-yield E&P debt to 2.6 percent, from 10 percent and 5 percent, respectively, in October. He said, however, that the cash raised from the sales may eventually be used to invest in more high-yield energy credits.
Investors withdrew about 46 percent of the Aberdeen fund's assets last year, reducing its size to $989 million, according to Lipper data. The fund has lost 3 percent this year.
The BofA Merrill Lynch U.S. High Yield Energy Index posted its second-worst week ever last week, delivering a loss of 8.7 percent, exceeded only by an 11.1 percent loss in October 2008. The average yield on an energy junk bond hit a record high of 18.44 percent on Tuesday.
Lipper's Tjornehoj said that managers may eventually be right, and energy spreads will narrow. "But by that time they may have very little money in the portfolio to crow about."
http://www.foxbusiness.com/markets/2016/01/20/bond-funds-remain-confident-as-crude-rout-worsens.html

Photo source
http://fuelfix.com/blog/2016/01/22/moodys-places-120-oil-and-gas-companies-on-review-for-downgrade/#36696101=8
Moody's places 175 oil, gas and mining companies on review for downgrade
Jan 22 2016, 08:28 ET | By: Carl Surran, SA News Editor
Moody's places 120 oil and gas companies on review for a downgrade, in a sweeping global review that includes all major regions..Warning of "a substantial risk that prices may recover much more slowly over the medium term than many companies expect
http://seekingalpha.com/news/3045856-moodys-places-175-oil-gas-mining-companies-review-downgrade
Fri Jan 22, 2016 8:37pm EST
Moody's puts 175 commodity firms on review over bleak outlook
LONDON | BY RON BOUSSO
It (Moody's)said it was likely to conclude the review by the end of the first quarter which could include multiple-notch downgrades for some companies, particularly in North America.
A ratings downgrade makes borrowing more expensive for companies.
"Even under a scenario with a modest recovery from current prices, producing companies and the drillers and service companies that support them will experience rising financial stress with much lower cash flows," it said.
http://www.reuters.com/article/us-energy-ratings-idUSKCN0V00Y6
Rating Action: Moody's reviews energy companies in the US for downgrade
Global Credit Research - 21 Jan 2016
https://www.moodys.com/research/Moodys-reviews-energy-companies-in-the-US-for-downgrade--PR_342569

@junkster Where do you see comments from Jim Rogers didn't know if he was even alive .

Still around albeit I have found him over the years to be more of a contrary indicator. Always thought of him as a doom and gloomer and a gold bug.
http://www.foxbusiness.com/markets/2016/01/05/jim-rogers-long-china-short-u-s-junk-bonds.html

Kaspa
Your point is reasonable and I suppose the PR people at the funds would like to have us believe that.
However, truth is there are way too many variables affecting these funds at different times to project how they will perform relative to equities on any given day.
Some balanced funds are simply run more aggressively and come closer to stock funds in both volatility and potential return. Also, managers can change a fund's emphasis without you and I realizing it hoping to protect assets or boost return. Moving to longer dated Treasuries for example. Or starting a new position in a company. OAKBX has been loading up on GM stock for about a year thinking the safety probes, suits, etc, have depressed it below true value. On days when GM is unfavorably mentioned in the press (and the stock suffers) OAKBX swoons. The fund has also traditionally had a foot in the energy market which of course isn't helping it.
My balanced funds today: PRWCX -.70, OAKBX -.70, DODBX -.90 . Compare DODBX to it's all-equity sister DODGX which lost about 1.3%
---
I think you may have also highlighted a second issue which is that with bond yields as low as they are today, they do not offer the degree of protection one might expect within a "balanced" portfolio. In fact, Seems to me that both David Snowball and Ed Studzinski have mentioned this second point in their commentaries over the past several years.
Regards

http://www.bloomberg.com/news/articles/2016-01-19/husky-suspends-dividend-cuts-spending-as-oil-rout-deepens
http://www.bloomberg.com/news/articles/2016-01-19/oil-giants-start-losing-safety-net-as-refining-margins-squeezed

"Global refining margins, the estimated profit from turning oil into gasoline and diesel, fell 34 percent in the fourth quarter, the steepest decline in eight years, to $13.20 a barrel, data on BP Plc’s website show. Every $1 drop cuts BP’s pretax adjusted earnings by $500 million a year, according to its website.
The companies face a squeeze on processing profits as a mild winter curbs demand for heating oil and diesel, creating huge stockpiles in the U.S. and Europe. That’s a reverse from the past two years, a period when refining earnings doubled, and kicks away one of the remaining buffers for integrated oil giants grappling with crude prices at a 12-year low.
“It’s a bit of a double whammy, lower oil prices and refining margins starting to weaken,” said Iain Reid, an analyst at Macquarie Capital Ltd. in London. “The safety net is still there, but there are some holes in it now.”

This game is a long way from being over, and I don't think the oil majors are immune. It may just take a little while until they are impacted. Already, we see income-- both operating and net--- taking a hit with most of them, and if things like refining margins decline to ziltch.... well, are dvd cuts really off the table? Buy those "juicy" yields (aren't they always) and be the bag holder later. No need to rush in; patience could be richly rewarded here.

@Mike
Yep. Tough going. But our energy investments have been small. 80% of portfolio is buy and hold. Hard asset range withiin that is 7-10%, divided-up among a commodities, gold, and real estate fund. Those 3 combined can't exceed 8% of total. Rather than rebalancing into them, we've simply taken recent distributions from other areas.
In the 20% that's not buy and hold, I've added gradually to PRNEX for over a year. Obviously hasn't worked as hoped. (Lost crystal ball years ago.)
Best to you Mike and others - regardless of the investing path

My ownership in this clobbered sector
Eventide Healthcare & Life Sciences Fund CLASS N SHARES
ETNHX
17.77-0.70(-3.79%)
Jan 19, 4:00PM EST
Performance below does not reflect Today's loss of -3.79% so YTD -26.25 in 11 trading sessions. Popular bio fund FBIOX YTD -23.62XLE (oil sector E T F) YTD -11.84 % AMLP ( M L P etf ) YTD -23.4 SPY (500 stocks) YTD -7.75
ETNHX
Trailing returns
1 day -2.89%
1 week -9.55%
4 week -21.51%
3 month -15.40%
YTD -22.46%
1 year -10.84%
3 years* +20.22%
Standard deviation 1 yr 28.86 3 yr 25.29
https://www.google.com/finance?q=MUTF:ETNHX&ei=BcCeVtH_LoqNmAGh5pu4Bw
https://www.google.com/finance?q=fbiox&ei=Xr6eVrHmLIbKmAG_6oSwBw
As of December 31, 2015:

December 31,2015 top holdings. Still full of promise.Aren't they?Maybe?Hopefully?
Collegium Pharmaceutical Inc (5.56%) Abuse-deterrant treatments for chronic pain
Five Prime Therapeutics Inc (4.46%) Screening human proteins to discover and develop novel drugs
Ultragenyx Pharmaceutical Inc (2.39%) Bringing treatments to market for debilitating genetic diseases
Loxo Oncology Inc (2.34%) Treating cancer at the genomic level with targeted chemical therapies
Portola Pharmaceuticals Inc (2.30%) Therapies to treat thrombosis and other hematologic disorders
TESARO Inc (2.30%) Drugs to treat cancers and reduce therapeutic side-effects
Kite Pharma Inc (2.23%) Clinical-stage therapies that harness patients’ immune systems to Fight cancer
DBV Technologies SA (2.21%) Patient-friendly therapies for food and pediatric allergy patients
Celgene Corp (2.20%) Discovery, development and commercialization of life-changing cancer therapies
Seattle Genetics Inc (2.14%) Antibody-drug combinations to treat lymphoma and other cancers
http://eventidefunds.com/our-products/#!healthcare

RSIVX WBMAX ARIVX PRPFX AQRNX MFLDX WAFMX SFGIX I just hope GPMCX is not the next.

Not arguing with your overall point, but I don't think WAFMX and SFGIX deserve to be on that list. Sure, they've lost a good amount of money on an absolute basis, but they have still performed much better than the rest of the emerging markets sector. Folks that "jumped on the bandwagon" for these funds are still better off than if they had put their money in almost any other emerging markets fund.

Completely agree and I apologize. They are five star funds and I can understand long term investors being in them. I just have a thing about holding losers over a long period of time as I want my capital compounding on a *consistent* basis. I realize though 3 years is not a "long period of time" for most investors. Unlike most here, I don't have a salary or pension to fall back on during the lean times.

@Junkster: referencing the sizable cash positions?

Don't mind me. Sometimes I can be an ornery cuss. Just a reference to all the funds most here tend to congregate in. Not exactly wealth accumulation machines the past several years. But most investors find comfort in being part of a crowd - or something to that effect so said Charles Mackay.

Short Answer: Slowly
Pie charts are a lot of fun. Used to play around slicing and dicing in the early years. Good way to visualize your allocation and determine what makes sense to you.
Past 10 years (excluding '08-'09) my only significant changes have been to gravitate slowly to a more hands-off approach. 15 years ago that was maybe 50% When the '08 debacle began it was around 60% (but I violated those guidelines in early '09 by loading up on global stock funds out of desperation.) Today I'm 80% hands off. The primary value (assuming there is any) is that it prevents me from tinkering around much and, hence, protects me from my own stupidity.
Not recommending any of this. Not an expert. Last couple years I've looked more like an idiot.
$29 oil? Who would've thunk?

FYI: (Scroll down to read Barron's Roundtable)
Jan 16 In recent years, bond investor Jeffrey Gundlach has been outperforming his rival Bill Gross. He has even been dubbed the "Bond King" by the media - a title Gross has held for many years. Now, Gundlach has replaced Gross on a high-profile investor panel.
Weekly financial magazine Barron's said on Saturday that Gross decided to quit its Barron's Roundtable. Instead, Gundlach, who has often been critical of Gross's investment calls, was added to the panel - which meets at the beginning and middle of each year - and he features prominently in the magazine's Roundtable latest cover story published on Saturday.
Regards,
Ted
http://www.reuters.com/article/usa-bonds-kings-idUSL2N1500FE

FYI: (This is a follow-up article)
An IT employee at Vanguard Group, Rebecca Snow asked for a month off in 2013 to care for her dying mother in hospice and her ailing father.
Not long after her leave, Snow was fired from her computer systems job, despite 13 years of raises and excellent reviews. Colleagues who took a family leave routinely suffered bad reviews, pay cuts, and firings, Snow alleged in a suit she later file
Regards,
Ted
http://www.philly.com/philly/business/homepage/20160117_When_workers_complain__Discrimination_lawsuits_accuse_Vanguard_of_targeting_workers.html

I customarily wait for year-end pay-outs and then, after the New Year, re-jigger. I like to feed profit from aggressive funds into more conservative funds. (Trim MSCFX for example, and put the proceeds in MAPOX. But not this year. No profit in MSCFX.)
"what is the best way to change your asset allocation, slowly over a period of a year or two or drastic changes over a period of a few months? I know it's not the best time to make those changes, but maybe I should wait for the market to settle down."
If you've any funds that generated profits from the past few years, find yourself an excellent bond fund that can serve as your CORE--- even if it's not labelled as such. I own DLFNX, but the big, fat sister--- DLTNX--- performs better, even through the recent fecal couple of weeks. Put profit into a core-bond fund, out of high yield. But don't necessarily CLOSE your HY positions.
Or, look at the whole thing as a longer-term process of DCA-ing into more ideal funds for your own Big Picture. Right now seems a decent time to buy. Or get into some good, currently cheap blue-chip individual stocks. Apple at these prices looks like a steal.
http://www.morningstar.com/stocks/xnas/aapl/quote.html
http://www.morningstar.com/funds/XNAS/DLTNX/quote.html
http://www.morningstar.com/funds/XNAS/DLFNX/quote.html
http://www.morningstar.com/funds/xnas/dodix/quote.html
http://www.morningstar.com/funds/XNAS/FTBFX/quote.html

Thanks for the input. Yes, I own DODIX, PIMIX and DBLTX as core bond funds. I do have a few funds with profits but have to be careful with large capital gains that have accumulated. I do understand your logic, however.

Hi @Willmatt72,
I think how you go about this is up to you with there being no wrong or right answers.
I usually make changes slowly. First I think you need to Xray your portfolio as a whole to see what you have and to see its diverfisication. Then you need to Xray each fund to determine its makeup. Then you can start subtracting or reducing positions adjusting your overall allocations here and there and then view this through Xray to view these changes. You might also study some funds that have an asset alocation and risk profile you are seeking to build.
Again, I'd go about these changes slowly no more than 1% per month in moving assets from one area to another. Example, if you are wanting to reduce you allocation to high yield start working this off slowly because now that they have been beaten-up of late they might recover some throuh an average out process. Then you need to decide where you want to put the one percent you are lightening up over in the high yield area. Do you have any convertible and bank loan funds? These are something you might wish to explore. I have them in my portfolio.
Good luck ... and, again my suggestion is to make changes slowly. Following the one percent per month rule over a years time you will have relocated 12% of the portfolio in a years time. Based upon a million dollar portfolio that's about $120,000.00 relocated each year. You might find that it will pay to keep moving some money around from time-to-time moving away from a static allocation towards something that offers some flexability.
In addition, I'd find a risk tolerance questionaire and determine what overall cash, bond and stock allocation is right for you. My broker sends me one to fill out and return about once annually, now that I am retired. I take a little more risk than they suggest in equities but I also hold more cash than they think I should plus I am a little light in fixed income over their suggested range. This might be something worth visiting.