http://www.marketwatch.com/story/why-sears-is-still-a-sell-2014-11-07?link=MW_home_latest_news
Creation of a REIT would amount to “just buying them some more time,” said Ken Perkins, president of Retail Metrics. “Almost all of what they have done over the past several years is financial engineering and not addressing the core business problems.”
EXACTLY. People complained about IBM's financial engineering - what Eddie Lampert has done to Sears over the last several years is the biggest example of the worst aspects of financial engineering.

Your kidding right? My wife could beat these returns! with no help from me and her own picks from 5 min.looking over Funds!
Their Real Record during the best (5 yr) market in the last century:
Harvard’s endowment posted annual average gains of 1.7 percent in the five years ended June 30, 2013, according to data compiled by Charles Skorina & Co. That compares with annual returns of 6.8 percent at Columbia University, 5.4 percent at University of Pennsylvania and 3.3 percent at Yale University.

7/1/2008 to 6/30/2013 was hardly the "best five year market" in the last century. The investment in VTSMX from 7/1/2008 - 6/30/2013 turned $10,000 into $14,254.52, an annual return of 7.3%, well below the average yearly return of 11.5% for the S&P 500 from 1928-2013.
That period did, however, coincide with the worst sustained market downturn in over 70 years. and turned $10,000 into $5381.58 on 3/6/2009. (The same investment in VWELX turned $10,000 into an almost identical $14,169.26, an annual return of 7.1%, and only lost 30.5% on 3/6/09.)
Harvard lost ~27% in the downturn. Yale lost 24.6%. As Scott pointed out, endowments that size do not act like individual's portfolios and shouldn't be judged the same way. At the very least, one has to consider that money is constantly being distributed to fund massive research institutions. That David Swenson somehow returned slightly less than the market over the period, with less volatility than the most recognizable 60/40 portfolio in the world, is remarkable.

Not so sure that Craftsman tools are still made here, Ted. Seems to me that I've heard or read otherwise. But they sure as hell were made well, years ago. I've still got quite a few that I bought over 50 years ago.

Nice going Ol Skeet--- I do recall some discussion about falling knives a few weeks back. Don't know if it was related to the near 10% drop in the S&P. Might have been.
But it might have had more to do with my decision to buy into the NR/commodity areas when they were falling. Actually, despite the hysterical media coverage, the two funds (QRAAX & PRNEX) have held up pretty well over the past 3 or 4 weeks since I bought in - although both are showing big losses YTD. PRNEX was actually up .90% yesterday - far better than anything else that I own or track. I view both as long term hedges against a frothy equity market. So if the 2 funds do reasonably well over the next 3-5 years, I don't particularly care about shorter term performance.
Nice bounce for gold today. Up $28 last check. Energy sector showing strength in recent days - especially nat gas and heating oil due to some pretty extreme weather. Recall seeing 37 and snow flurries in Atlanta few days back.
Apologies to Ol Skeet. My spellchecker preferred Ol Skirt - I've now corrected it. :)

Your kidding right? My wife could beat these returns! with no help from me and her own picks from 5 min.looking over Funds!
Their Real Record during the best (5 yr) market in the last century:
Harvard’s endowment posted annual average gains of 1.7 percent in the five years ended June 30, 2013, according to data compiled by Charles Skorina & Co. That compares with annual returns of 6.8 percent at Columbia University, 5.4 percent at University of Pennsylvania and 3.3 percent at Yale University.
.http://www.bloomberg.com/news/2014-06-18/harvard-money-managers-exit-on-subpar-private-equity-bets.html

Certainly interesting to watch...

But a lot of altitude to make up given its decline the last 5 years...

Ira shared this MFWire story with me this morning and suggested I might pass word along. Barron's hired a new guy to succeed Brendan Conway at their funds blog.

This WSJ Alum Will Focus On Funds, and ETFs
Reported by Neil Anderson, Managing Editor
Fundsters, there's a new voice at Barron's you should be paying attention to.
MFWire has learned that Chris Dieterich recently joined the publication as a staff writer and blogger focused on funds, especially ETFs. He now leads both the realtime "Focus on Funds" blog and the weekly "ETF Focus" column.
...
Dieterich ... he hails from Regis University and the University of Missouri-Columbia. He joined Barron's sibling Dow Jones Newswires four years ago, before moving to the Wall Street Journal [where he] served as a markets reporter, focusing on stocks and ETFs.

I welcome him to the neighborhood and wish him well. I worry, a bit, about the term "realtime" (sic) in the story since it suggests that he, like so many others, is locked into the high output/low reflection model where the need for "six new posts by the market's close" drives the job.
David

FYI: Most Japan open-end and closed-end funds and ETFs that have been around 15 years have lagged the S&P 500 in that period, and all lag year to date.
A $10,000 investment in Japan-invested open-end mutual funds on Sept. 30, 1999, would have grown to $16,504 by Oct. 4 this year, according to Morningstar.
Regards,
Ted
http://license.icopyright.net/user/viewFreeUse.act?fuid=MTg2MzQ5MjQ=
Enlarged Craphic: http://news.investors.com/photopopup.aspx?path=WEBlv1106_1K.jpg&docId=725220&xmpSource=&width=1000&height=1047&caption=&id=725221

:) Yes, you guys must be using the Institutional share-class ticker. I'm glad I'm in DLFNX. Over two years, now.
http://quotes.morningstar.com/fund/f?t=DLFNX&region=USA

@Andy, I think DBLTX has a slightly better downside protection (3 years) than DBLFX according to M*.
http://performance.morningstar.com/fund/ratings-risk.action?t=DBLFX&region=usa&culture=en-US

FYI: Over the years I’ve dished out lots of investment advice, and I believe I’ve gotten it right most of the time. Lately, though, I've wondered: What’s the best advice I ever heard?
Regards,
Ted
http://www.marketwatch.com/story/the-best-investment-advice-ever-2014-06-11/print

Very interesting, Charles. The M* analyst report for GONIX (assuming the details are accurate) has a good description of the strategy.
Basically, it's designed to be 25% net long (120 long, 95 short, but with such a tiny beta that it falls into the M* market neutral category). They do a quant sort on adjusted cash flow and earnings for a universe of 2,000 U.S. stocks, and then, based on the rankings they come up with from doing their preferred math, go long the highest-rated 400+ and short the lowest-rated 400+.
I've never looked into MN funds much before, so have no idea how this approach compares to others, but from a quick view, I'm thinking this one at least bears watching, on the off chance they'll eventually make retail shares available at less than outrageous cost.
GARIX, the long-short fund, goes 60% long using the same methodology, with ~ 400 long and 300 short positions.
I do like this wave of quant and rules-based strategies that have been coming out over the last few years.
Thanks for the reference,
AJ

it's still a regular IPO process with 5% underwriting fee and over-allotment shares (support). It takes around 45 days to get rid of the premium most of the time. under certain market conditions and in several "star" offerings, premium might only increase over and above 5%, but it is indeed a rare occasion.
underwriting fees are paid by investors who get access via financial advisors associated with the underwriting, most notably UBS, MS, BAC.
for a semi-educated investor, the time to buy after the IPO premium has disappeared. it could be due to the price going down or due to exceptional performance of the NAV catching up with the price.

My understanding of the ipo issue with CEFs: There are costs to bring a new closed end fund to the market. Those costs are borne by those who purchase the initial public offering. When I looked into it years ago, those costs averaged approx. 5%. So at the time, most closed end funds, at the ipo prior to the first trading day, were priced roughly 5% above the NAV, due to those costs.

It sounds like the best you can do now is buy into a fund that that a good percentage of healthcare in it. Matthews has some. Thinking on the subject a bit more, healthcare here would be mostly a volume issue as more and more people can afford it. As an example, a relative of ours works in a kidney dialysis unit in a larger hospital. They are quite busy with two shifts a day. Ten years ago this was not the case. Most kidney patients had to go to Manila. This is in another major city on Mindanao. They have started heart and brain surgeries also which also were only available before in a couple of hospitals nationwide. While this is a good area to watch the biggest bang will still be in biotech, bionics, and anything that is future related. The US, Australia and Europe will lead in those areas.
Thanks for the follow up @LLJB.

managed distribution is almost unique to equity CEFs. ... i generally don't understand why you need to access equities via CEFs anyway... so managed distributions is not a concern for majority of the CEF investors.

Still true, but not as obvious as one might think. From ICI's 2014 Investment Company Fact Book:

Historically, bond funds have accounted for a large share of assets in closed-end funds. A decade ago, 75 percent of all closed-end fund assets were held in bond funds, and the remaining 25 percent were held in equity funds (Figure 4.2). At year-end 2013, assets in bond closed-end funds were $165 billion, or 59 percent of closed-end fund assets. Equity closed-end fund assets totaled $114 billion, or 41 percent of closed-end fund assets. These relative shares have shifted, in part because cumulative net issuance of equity closed-end fund shares has exceeded that of bond fund shares over the past seven years. In addition, total returns on U.S. stocks* averaged 8.1 percent annually from year-end 2003 to year-end 2013, while total returns on bonds† averaged 4.7 percent annually.

CEFconnect reports only 6 out of 146 closed end taxable bond funds (and no tax-free bond funds) have managed distributions, confirming that most managed distribution funds are equity funds.

My understanding of the ipo issue with CEFs: There are costs to bring a new closed end fund to the market. Those costs are borne by those who purchase the initial public offering. When I looked into it years ago, those costs averaged approx. 5%. So at the time, most closed end funds, at the ipo prior to the first trading day, were priced roughly 5% above the NAV, due to those costs.

Well, at least GTAA did not fall during 4 years (it hugely underperformed other global funds). But his new global fund GVAL plunged down 13.5% during the first 8 months of its life. I do not know what is wrong with Meb as a money manager. Having his money in his funds is commendable, but should we follow his example? He is getting paid even when his funds are going down.

GVAL has a ton in Brazil and Europe (Spain, Italy, etc.)
Brazil has been a mess and doesn't look to be really improving. Europe is problematic, as well.
From the fund website:
"Removing Emotional Decision Making - One of the difficulties of investing in foreign countries is the inability to stay the course when geopolitical headlines
are negative. The Cambria Global Value ETF rebalances into countries that are trading at low valuations, which often coincide with negative headlines and
bear markets in such countries’ stock indexes. GVAL gives the investor the potential benefit of owning securities in over-sold markets."
So you have a fund that searches out stocks trading at levels believed to be below intrinsic value, but is it taking into account anything else, like potential catalysts? Appears to be no.
So, you have a fund that's going to lag, possibly for a long time, while it tries to move towards undervalued areas but is unconcerned if there's any sort of catalyst/reason.
Not quite sure on this methodology of searching out value based purely on unseen metrics, or at the very least it's something that should be a small % of a portfolio and understood that it's a long-term time horizon. Not something I'm really interested in, but that's just me.

Well, at least GTAA did not fall during 4 years (it hugely underperformed other global funds). But his new global fund GVAL plunged down 13.5% during the first 8 months of its life. I do not know what is wrong with Meb as a money manager. Having his money in his funds is commendable, but should we follow his example? He is getting paid even when his funds are going down.

I also have PHSZX. It has Potential Cap Gains Exposure 46.80%, and this year it will distribute some part of it. Historically it was a small fund, but success attracted investors, it closed and yet more than doubled in size since that time, so it is hard to say how good it will be in the future. Probably good since it has the same experienced manager for 15 years, but I do not want to add to it at this stage.

Dear Charles,
Can you explain why there is such an interest in Meb Faber and his funds? Perhaps he is a good theorist and a good writer, but his first ETF GTAA has grown by 5% since its inception 4 years ago, while world stock funds were up almost 50% and ARTGX has grown up 68% during the same time.
Then he started a new ETF, GVAL, in March 2014, and since that time GVAL plunged down 13.5% whereas ARTGX was 2% up.
So now he is starting yet another ETF, and MFO discusses how Meb Faber gets it right in interesting ways. Am I missing something?