There are a few CEF's on the London AIM exchange, but it looks like they haven't been run well (large discount due to poor earnings and risky assets). Forex is also a headwind. Operations are proving too costly and there are some legal issues. I think both are available at Fido. They provide more direct access to timber rather than paper products or mills. Okay, maybe I shouldn't have brought these up, but paper/wood manufacturing is different than timber.
Cambium Global Timberland (TREE.L)
Phaunos Timber Fund Limited (PTF.L)

I owned a little of the Cambium fund for a while a few years ago (there is a pink sheet share in the US). Would be nice to have a solid pure play on timber, but unfortunately, this just wasn't it. I can't believe it's down as much as it is since I sold it. I thought there was an activist shareholder in this at one point but I guess nothing came of it.
The best option I can think of in terms of something resembling a pure play is Acadian Timber (ACAZF.pk), which is owned by Brookfield Asset Management.

not going back. Had JATTX later morphed into JANIX for about 6-7 years and moved to vsmax @vanguard last year- after 1 year of change of guard

Hi @golub1
You noted: "Reversion to the mean works over the long term, but momentum works over shorter terms. How soon it fails and when to switch to another strategy is the great puzzler."
This statement pretty much sums the whole picture.
We are long term??? investors until we are not..... Some of long term holdings have been years (since the crash) and others sections have had a months time frame.
More than 25% of our current equity holdings are related to healthcare. This works until it does not, eh?
Thanks and take care,
Catch

Here's a study that indicates that when stocks are especially expensive, they tend to keep rising rapidly for a few years more... but then over 10 and 20 years periods the return is subpar.
http://seekingalpha.com/article/2934926-are-stocks-most-expensive-on-record#comment-48503146
I think the takeaway here is that mean reversion happens, eventually, but if you expect it to happen right now just because assets are overpriced right now you risk losing a big chunk of upside.
I'd bet junkster's techniques are far better for figuring out what to do right now.

@MFO Members: If you believe in GMO's 7-Year Real Return Forecast, I have a bridge for sale.
Regards,
Ted

Not just that but if you listen to *anyone's* forecast, 7 years or whatever. There are no "experts" in the forecasting or prediction business.
Edit: I played that game long ago when I was a losing investor/trader. The game that there is someone out there that knows where the markets are heading. So like so many I read all I could about the forecasts and predictions of the self proclaimed experts thinking I could somehow come up with an my own opinion based on the opinions of all those experts.

FYI: Small-cap value stock mutual funds have outperformed their core and growth counterparts over the past 15 years.
Their strength can be seen in what would happen to a $10,000 investment begun on Dec. 31, 1999. The average small-cap value mutual fundwould have turned that investment into $58,417 by Feb. 18 this year, according to Morningstar Inc. data.
The same sum placed in the average small-cap core fund, which invests in both growth and value stocks, would have increased to $49,822. Those investing in the average small-cap growth fund would be looking at $19,511. The S&P 500's result? $19,071.
Regards,
Ted
http://license.icopyright.net/user/viewFreeUse.act?fuid=MTg5OTk3Njg=
Enlarged Graphic:
http://news.investors.com/photopopup.aspx?path=webLVpent.jpg&docId=740140&xmpSource=&width=847&height=899&caption=&id=740125

Hi all,
Seems my below comment will fit well in several threads.
This is how I played the low yield cash environment.
I closed out my money market and CD's years back after the yield's of each went next to nothing; and, I took up positions in a few short term bond funds with some of this money which is a part of my fixed income sleeve. You might say, that short term bond funds have now become high risk cash positions with me.
The low return on cash has effected my portfolio's overall return greatly as I use to be able to get a four to five percent retrun on my cash ... and, well, now next to nothing ... and cash usually makes up about 15% to 20% of my overall portfolio.
This has forced me to make some special spiff positions within the markets, form time-to-time, to help make some of my cash more productive. Thus far it has ... but, has not fully covered the prior yields of four to five percent once had. And, last year the spiffs were few and far between. I am still with the October 2014 Spiff with an average cost of 1905 on the S&P 500 Index. This puts this spiff thus far at about a 10.2% return. But, it would take a number of these to cover the full four to five percent yield I was earning on all of my cash since these spiff positions are much smaller in size than my total cash position.
I am wondering what you might have done to deal with this low return on cash environment?
Old_Skeet

Hi all,
This is how I played the low yield cash environment.
I closed out my money market and CD's years back after the yield's of each went next to nothing; and, I took up positions in a few short term bond funds with some of this money which is a part of my fixed income sleeve. You might say, that short term bond funds have now become high risk cash positions with me.
The low return on cash has effected my portfolio's overall return greatly as I use to be able to get a four to five percent retrun on my cash ... and, well, now next to nothing ... and cash usually makes up about 15% to 20% of my overall portfolio.
This has forced me to make some special spiff positions within the markets, form time-to-time, to help make some of my cash more productive. Thus far it has ... but, has not fully covered the prior yields of four to five percent once had. And, last year the spiffs were few and far between. I am still with the October 2014 Spiff with an average cost of 1905 on the S&P 500 Index. This puts this spiff thus far at about a 10.2% return. But, it would take a good number of these to cover the full four to five percent yield I was earning on all of my cash since these spiff positions are much smaller in size than my total cash position.
I am wondering what you might have done to deal with this low return on cash environment?
Old_Skeet

As mentioned in another thread, Gundlach is right more than he is wrong. I would take his word over a WSJ article that waffles on the question.
Output is increasing so that is good. The Saudi's hate it though. Too bad.

Oh I absolutely agree re: Gundlach. I wish he'd have a fund where he could invest in a broader manner than bonds, as he's actually made a number of good non-bond calls in recent years.
Perhaps Doubleline Global Macro is in order?

Doubleline has a multi-asset fund which invests globally. Gundlach is one of its managers, I'd presume he's handling fixed income. There's also a Doubleline growth fund run by another manager.

As mentioned in another thread, Gundlach is right more than he is wrong. I would take his word over a WSJ article that waffles on the question.
Output is increasing so that is good. The Saudi's hate it though. Too bad.

Oh I absolutely agree re: Gundlach. I wish he'd have a fund where he could invest in a broader manner than bonds, as he's actually made a number of good non-bond calls in recent years.
Perhaps Doubleline Global Macro is in order?

He sold JNJ couple years ago...its been up ever since and Hit over $100, again today,
Thanks warren

I never take the rental insurance. We were in a string of cars rear-ended by a freight truck while waiting at a stop light in Florida several years ago. Our rented Ford Focus was one of 3 totaled. Driver got a ticket for failure to stop in time - nothing more. Florida law is no-fault. Can't even sue unless you die or are permantly disabled. We were shaken but walked away.
Budget rental was great. Had another vehicle at the accident scene in half an hour. Sent us a bill month later for well over $20K. Our Michigan insurer negotiated price and than paid off claim. No separate rental coverage on policy - but agent had previously assured us we were covered. Also waived the deductible.
Policy only includes this protection as long as we maintain full coverage on one vehicle. Were we to discontinue collision (just carry PLPD), would not have rental coverage. There may also be a limitation on that coverage up to the value of our insured auto. Can't seem to get a straight answer from agent on that one. We learned our Visa card at the time also carried rental car protection - as long as we rented with it. Not sure if that's still true.

Yes, I remember those small stall-stores all over the place, with those names there even fifty years ago.

Question: Perhaps I'm wrong, but I was under the impression that Buffet no longer personally made the decisions for the stock holdings of Berkshire. He still works directly on Berkshire's acquisitions of whole companies as well as other special situations, but he's assigned other people to work the stock market for him. Is this so or am I hallucinating again?

Buffett definitely makes decisions, but I believe a fairly significant amount of money has been farmed out to the two newer managers. It remains to be seen who is next in line to replace Buffett, although possibly some hints of that will be in the "next 50 years" letter (which I think was supposed to come this month?)

The trade has been crowded for a while, but that $20 billion is not betting against just one currency. Probably most of it is betting against the EUR and Yen, but there are other currencies people would hedge against the strong dollar. IMO the Euro and Yen are not getting stronger anytime soon. It may be years that the dollar trends stronger and as long as it doesn't weaken then hedged investments will perform the same or better than un-hedged alternatives.
When it does change then it might get ugly, but I don't think that will be soon and the beauty of ETFs is that shutting down positions and knowing where and how big your bets are is a lot easier than with mutual funds.

Hi, Derf.
One simple expedient would be to drop a note to Seafarer and ask. In general, expense waivers are almost never revoked although many contain a "clawback" provision. At base, advisers sometimes subsidize a fund until it hits a breakeven point but then they don't lower the expense ratio further until they've recouped some or all of the money they spent underwriting fund operations. In Seafarer's case, they can recoup expenses for the three years immediately prior to when they turn profitable.
Andrew joked at one point that he and I both run non-profit entities, the difference between that I do it on purpose.
A concern for shareholders is, I believe, part of Seafarer's DNA. They've repeatedly lowered their expense ratio, despite the fact that Morningstar wouldn't give them credit for the move since Morningstar uses the expense ratios from the annual report. Morningstar reports a 1.4% e.r. for Seafarer, which reflects the April 2014 Annual Report's calculation of the fund's 2013 expenses. The September 2014 prospectus commits to a 1.25% e.r. but Morningstar's profile of the fund in 2015 reports the expenses investors bore in 2013 as if they were current.
As ever,
David

Hi Ted,
Thanks for stopping by.
I had to turn to Google to find out who Arch Crawford was. For those interested I have provided a link to his site. It is interesting that our apperance favors along with our voice and speach pattern ... but, I hate to disapoint you .... I am not this person.
http://www.crawfordperspectives.com/
On the portfolio it is what it is and meets my needs. The performance numbers from Morningstar did not include the added return benefit of my special investment positions, spiffs as I have frequently called them. For 2014 my distribution yield was north of five percent and I look at the portfolio as a diverisfied income generator. It has worked well for me through the years and I see no reason to make any major changes at this time. However, I do plan to reduce my allocation to domestic equities over the coming months and raise my allocation to some other assets.
Here is a brief description of my sleeve system which I organized to help better manage the investments that were held in five accounts. The accounts consist of a taxable account, a self directed ira account, a 401k account, a profit sharing account and a health savings account plus two bank accounts. With this I came up with four investment areas. They are a cash area which consist of two sleeves … an investment cash sleeve and a demand cash sleeve. The next area is the income area which consists of two sleeves. … a fixed income sleeve and a hybrid income sleeve. Then there is the growth & income area which has more risk associated with it than the income area and it consist of four sleeves … a global equity sleeve, a global hybrid sleeve, a domestic equity sleeve and a domestic hybrid sleeve. An finally there is the growth area, where the most risk in the portfolio is found and it consist of four sleeves … a global sleeve, a large/mid cap sleeve, a small/mid cap sleeve and a specialty sleeve. Each sleeve consists of three to six funds (in most cases) with the size and the weight of each sleeve can easily be adjusted, from time-to-time, by adjusting the number of funds and the amounts held. By using the sleeve system one can get a better picture of their overall investment picture and weightings by sleeve and area. In addition, I have found it beneficial to xray each fund, each sleeve, each investment area, and the portfolio as a whole monthly. Again, weightings can be adjusted form time-to-time as to how I might be reading the markets and wish to weight accordingly. All funds pay their distributions to the cash area of the portfolio with the exception being those in my 401k, profit sharing, and health savings accounts where reinvestment occurs. With the other accounts paying to cash the cash area builds cash within the portfolio to meet the portfolio’s monthly cash distribution needs with the residual being left for new investment opportunity. In addition, most all buy/sell trades settle from, or settle to, the cash area.
Here is how I have my asset allocation currently broken out in percent ranges, by area. My neutral targets are cash 15%, income 30%, growth & income 35%, and growth 20%. I do an Instant Xray analysis of the portfolio monthly and make asset weighting adjustments as I feel warranted based upon my assesment of the market, my risk tolerance, cash needs, etc. Currently, I am neutral in the cash area, light in the income area and heavy in the equity area. I am thinking that once year end mutual fund capital gain distributions are paid out this will somewhat reduce the equity area and raise the cash area.
Cash Area (Weighting Range 5% to 25%)
Demand Cash Sleeve… (Cash Distribution Accrual & Future Investment Accrual)
Investment Cash Sleeve … (Savings & Time Deposits)
Income Area (Weighting Range 20% to 40%)
Fixed Income Sleeve: EVBAX, LALDX, THIFX, LBNDX, NEFZX & TSIAX
Hybrid Income Sleeve: AZNAX, CAPAX, FKINX, ISFAX, PASAX & PGBAX
Growth & Income Area (Weighting Range 25% to 45%)
Global Equity Sleeve: CWGIX, DEQAX, EADIX & PGUAX
Global Hybrid Sleeve: CAIBX, IGPAX & TIBAX
Domestic Equity Sleeve: ANCFX, CFLGX, FDSAX, INUTX, NBHAX, SPQAX & SVAAX
Domestic Hybrid Sleeve: ABALX, AMECX, DDIAX, FRINX, HWIAX & LABFX
Growth Area (Weighting Range 10% to 30%)
Global Sleeve: ANWPX, PGROX, THOAX, DEMAX, NEWFX & THDAX
Large/Mid Cap Sleeve: AGTHX, BWLAX, HWAAX, SPECX, IACLX & VADAX
Small/Mid Cap Sleeve: IIVAX, PCVAX & PMDAX
Specialty Sleeve: CCMAX, JCRAX, LPEFX, SGGDX & TOLLX
Total number of mutual fund investment positions currently held equal fifty two.
Have a grand day, Ted ... and, thanks again for stopping by.
Old_Skeet

BARRINGTON FINANCIAL ADVISORS, INC.
a Registered Investment Advisor
(Celebrating 42 years of Professional Service)
MARKET COMMENTARY
FEBRUARY 2015
King Dollar is a two-edged sword. The very strong dollar has helped to cause the dramatic fall in oil prices. Like oil, all commodities are priced in dollars, so copper, iron ore, coal, grains, etc., are all lower in price, which has given the U.S. a very low inflation rate as well as adding after-tax dollars to the consumers’ pocketbook. Engineers know for every action, there is an equal and opposite reaction. This does not always occur in financial markets but it has this time. Our strong currency is slowing our exports since other countries need to spend more of their currency to purchase our exports. This causes inflation in other countries, which is slowing their growth and lowering their consumption. Also, the fall in oil prices is causing domestic companies to dramatically lower capital spending this year resulting in announced lay offs in drilling and oil field service companies. This is problematic because the hydrocarbon industry has been the largest provider of high paying jobs over the last five years.
What was initially announced as a 2.6% GDP increase in the fourth quarter, will probably be reduced as more data on our export activity is more available. However, going forward, there are several factors which point to a continued increase in U.S. growth. Back on February 6th the U.S. Labor Department announced a stronger-than-expected increase of 257,000 jobs for January. They also increased the new hires number for December and November by 147,000 jobs. This is the largest labor increase in a three-month period since 1997. The Labor Department also stated wage gains were beginning to see higher growth. Outside of the energy business, labor hires are increasing. Retail, construction, manufacturing, and healthcare all showed an increase in hirings. The lower gasoline prices has allowed consumers to be able to increase their savings without crushing spending. They are also buying larger vehicles again. Truck and SUV sales have increased over the same periods a year ago. These vehicles are more profitable to the automobile manufacturer, which allows them to increase their profit as well as increase hiring.
As we mentioned earlier the strong dollar has contributed to the dramatic fall in the price of oil. However, slower demand from a slowing world economy along with increased production in Canada and the U.S. quickened the fall in price as surpluses rose. We believe there are several factors, which will cause prices to stabilize and start to rise sooner than many analysts are predicting. The Energy Information Agency (EIA) last week announced that gasoline consumption in January showed a dramatic increase over a year ago. The International Energy Agency (IEA) is predicting world-wide consumption to increase to around 94 mm barrels/day by the end of the year, an increase of about 1.5 mm barrels. In addition, political problems around the world are beginning to slow production. Libya has slowed exports by about 500,000 barrels/day over the last two months and the EIA announced domestic production decreased by 33,000 barrels/day last month. For these reasons we believe the price of oil has currently stabilized around the $50 per barrel price and has started to rise back up toward the $70 to $80 per barrel that we think it will reach by year end. This price increase will be aided by a somewhat weaker dollar between now and year end.
The oil price collapse has caused some investors to throw out the baby with the bath water. As a patient investor, there are bargains available in the market. As oil prices have fallen, so have Natural Gas Liquids (NGLs). Ethane had fallen to about $0.40/gallon, down from over $1.50/gallon last year. This gives the U.S. chemical industry a distinct advantage over other areas of the world that use Naphtha to derive Ethylene. One sector of the economy that benefits from lower prices is the chemical industry. Westlake Chemicals (WLK) and LyondellBasell (LYB) are still our favorites in this sector. Their plant expansions are coming on line now thru mid-2017. This added capacity will lower their cost even more and enable them to take better advantage of the abundance of domestic NGL production. We feel both of these companies are still oversold. We do not feel that the price of oil is going to remain low enough for long enough to have any sort of negative impact on their earnings so we will be adding to these positions as cash becomes available.
The mid-stream sector was hard hit as well. These companies derive most of their income from fee-based revenue through their pipelines and NGL processing. They are largely shielded from the price of the hydrocarbon. Several mid-stream companies we follow are building capacity to take advantage of the domestic expansion in production and demand in the NGL space. Our two favorite names in this space are Enterprise Products Partners (EPD) and Kinder Morgan (KMI).
With the large drop in oil prices, almost all of the E&P companies have slashed their capital expansion spending for the coming year by at least 25% to over 50%. They will not ramp back up until oil prices rise and stabilize. As the price of oil gains ground back to the mid-$60s, several producers that have very good leases will again be very profitable. We are now slowly increasing our positions in several players in this area. Names we recommend are Concho Resources Inc. (CXO), EOG Resources (EOG), and Linn Energy (LINE). For an investment in the Marcellus shale, Gastar Exploration (GST) and Range Resources (RRC) are where we are currently adding money.
We are emphasizing investments in companies with good cash flow, good cash distributions and companies that operate in areas where they have a competitive advantage due to much lower energy costs and raw material input costs. We prefer companies with price earnings ratios that are at levels that are attractive compared to the low interest rates on investment grade bonds. BSG&L and BFA are long-term investors and we believe that if you are patient, build cash and buy good companies on pull backs, your portfolio will have good growth over the long term. Author: Ben Dickey, CFP/MBA/CHFC, Chairman of the Investment Committee, BSG&L Financial Services LLC.
We welcome any concerns, or comments you may have. Please feel free to call (713) 785-7100 or email us at any time.
Have a Blessed Day,
William C. Heath, CFP®
Chairman & CEO

I agree with some of what David Winters has said regarding emerging market consumers and still own a significant holding in former Wintergreen top holding Jardine Matheson. That said, the fund has not done terribly well in recent years, partly due to the Macau theme, which has seemingly cooled off quite a bit recently. He also has a few sizable energy holdings, including "forever a value" Canadian Natural Resources.
I don't think the emerging market consumer theme has done all that well in the last couple of years, although there have absolutely been some exceptions (especially the internet stocks - Tencent, for example.)
Keep in mind there has been a crackdown on luxury gifting in China, which has hurt stocks like Diageo and has probably hurt Richemont (http://www.cnbc.com/id/100445071)
The Winters vs Coke battle was ridiculous and he's probably taken losses on the Swiss holdings (Richemont, Nestle, Swatch) lately.
The Genting companies that Wintergreen holds are the most fascinating resort companies, but have done terribly as stocks. They are high on the list of "stocks I would like to like but can't."
I don't think Winters is wrong on the EM consumer trade, but I think his themes have run into problems and I get the sense in interviews that he's long-term in his beliefs/holdings and if you don't want to join him, go.
I completely agree with you regarding the lack of short selling. Not that one has to use that tool constantly or anything, but Winters has often pitched Wintergreen as a "hedge fund" with all manner of tools at its disposal and it's rare he seems to use any of them. He's discussed his ability to go activist - I mean, him going against Coke is literally kind of a David vs Goliath and kind of a waste of time and resources.
Seafarer would not be a bad choice at all, although that's EM vs Wintergreen (world fund), so not an apples-to-apples replacement. Still, at least Seafarer provides a bit of a yield.

First some clarifications
(1) John's reference to "tsp" leads me to think he's a Federal employee. A description of tsp http://www.investopedia.com/terms/t/thrift_savings_plan.asp
(2) His question refers to "401K". While not the same, 401Ks and TSPs operate pretty much the same. According to the description above, one can be converted into the other.
(3) John refers to "distribution" in his question. I suspect he means "contribution."
If John wants respondents to detail how much they invest annually in these plans, I can't answer. We contribute nothing in retirement. In fact, we take distributions of 4-5% annually. While employed, my contributions varied widely. The limit back in the 70s-90s was in the range of $6,000 to $10,000 annually as I recall. We seldom "maxed-out", except during the last few years.
The first article (which I read) isn't very well focused. It mentions the need to save and difficulties that often prevent families from doing so. It touches on RMD requirements. It gives $18,000 as the yearly limit on contributions. And, it notes that some employer plans feature a match.
Like most of these articles, they manage to get the wagon out in front of the horse a little. Before people can save, they have to to learn to manage household expenses through effective planning/budgeting. They also need to get off the credit Merry Go-Round if they're carrying over monthly balances on credit cards or other forms of revolving credit.
Once solvent, families can begin saving. I won't go overboard touting 401Ks. They're a great component to saving. However, as some have noted previously, the tax advantages eventually come back to haunt you in the form of the "ordinary income" tax rates applied on plan distributions. For at least some, 401Ks may not be the preferred method of saving. I once met a fellow who had chosen to invest during his working years in rental properties he was fixing-up and which would provide an income stream during retirement. So, one size does not fit all.
My favorite expression relating to monthly savings - "PAY YOURSELF FIRST."