I have been looking at Highland Capital Management with respect to their NexPoint Merger Arbitrage fund (HMEZX). In the process, I came across an article in the Wall Street Journal from October 16, 2019 that indicated that the firm filed for bankruptcy.
HMEZX has a very good record, but I was curious why the fund had only attracted $68 million in assets since it opened in September 2016. The answer may be found in this article:
"Highland Capital Management LP, once a giant in high-yield debt markets, filed for bankruptcy protection Wednesday as investors and former employees seek more than $200 million from the firm for alleged improprieties.
The Dallas-based firm founded by Jim Dondero helped pioneer trading of corporate loans rated below investment-grade and managed about $39 billion in 2007, but it took heavy losses during the financial crisis and has been embroiled in lawsuits ever since. The company had been trying in recent weeks to settle some of the litigation it faces, warning its adversaries that it would seek bankruptcy protection if they didn’t compromise, people familiar with the matter said.
Highland entered chapter 11 in U.S. Bankruptcy Court in Wilmington, Del., listing as its largest debt a disputed $189 million claim from investors in Highland Crusader Fund, a hedge fund that has been in liquidation since the financial crisis. The second-largest creditor is Patrick Daugherty, a former Highland portfolio-manager who has been in personal and legal conflict with Mr. Dondero since 2012 and has an $11.7 million claim against Highland, according to its bankruptcy filing.
A group of investors in Crusader sued Highland in 2016 in Delaware Chancery Court, demanding Highland be fired as manager for delaying the fund’s liquidation and claiming that Highland wrongfully paid itself $30 million. The group subsequently won an arbitration award that Highland has yet to pay, court documents show.
In a statement, Highland said the bankruptcy filing was made “in consideration of its liquidity profile” and stems from a potential judgment in favor of a committee of Crusader Fund investors."

I don't know the current status of of the bankruptcy filing, but, needless to say, I am no longer interested in HMEZX as a potential investment opportunity.
If anybody has more up to date information on the fund advisor's bankruptcy status, I would appreciate hearing from you.
But, buyer beware.
Fred

I have been looking at Highland Capital Management with respect to their NexPoint Merger Arbitrage fund (HMEZX). In the process, I came across an article in the Wall Street Journal from October 16, 2019 that indicated that the firm filed for bankruptcy.
HMEZX has a very good record, but I was curious why the fund had only attracted $68 million in assets since it opened in September 2016. The answer may be found in this article:
"Highland Capital Management LP, once a giant in high-yield debt markets, filed for bankruptcy protection Wednesday as investors and former employees seek more than $200 million from the firm for alleged improprieties.
The Dallas-based firm founded by Jim Dondero helped pioneer trading of corporate loans rated below investment-grade and managed about $39 billion in 2007, but it took heavy losses during the financial crisis and has been embroiled in lawsuits ever since. The company had been trying in recent weeks to settle some of the litigation it faces, warning its adversaries that it would seek bankruptcy protection if they didn’t compromise, people familiar with the matter said.
Highland entered chapter 11 in U.S. Bankruptcy Court in Wilmington, Del., listing as its largest debt a disputed $189 million claim from investors in Highland Crusader Fund, a hedge fund that has been in liquidation since the financial crisis. The second-largest creditor is Patrick Daugherty, a former Highland portfolio-manager who has been in personal and legal conflict with Mr. Dondero since 2012 and has an $11.7 million claim against Highland, according to its bankruptcy filing.
A group of investors in Crusader sued Highland in 2016 in Delaware Chancery Court, demanding Highland be fired as manager for delaying the fund’s liquidation and claiming that Highland wrongfully paid itself $30 million. The group subsequently won an arbitration award that Highland has yet to pay, court documents show.
In a statement, Highland said the bankruptcy filing was made “in consideration of its liquidity profile” and stems from a potential judgment in favor of a committee of Crusader Fund investors."
I don't know the current status of of the bankruptcy filing, but, needless to say, I am no longer interested in HMEZX as a potential investment opportunity.
If anybody has more up to date information on the fund advisor's bankruptcy status, I would appreciate hearing from you.
But, buyer beware.
Fred

his $60 stake in the video game retailer grew to $3,200

Unfortunately the 10 shares are worth about $1100 now

The stock market is the only place where anyone can invest in human ingenuity. It is a bet on the future being better than today. Stocks can be thought of as a way to ride the coattails of intelligent people and businesses as they continue to innovate and grow. Short of owning your own business, buying shares in the stock market is the simplest way to own a slice of the business world.

https://awealthofcommonsense.com/2021/02/how-the-stock-market-works/

I've held AKREX/AKRIX for several years now and have not been disappointed. It is my number two holding right now and although I plan on reducing it by three percent in the coming year or two (rebalancing), it will still be 2 or 3 in my portfolio.
Whether to keep it not depends on your need and expectation. It is not a high-flying fund, in fact, although it is very concentrated it is still LOW risk and somewhat defensive.
I am not worried about Mr. Akre stepping aside, there are two very capable managers in place now. Mr. Neff since 2014 (2009 w/Akre) and Mr. Cerrone just last year (2012 w/Akre).
I am giving them a year or two before I make a decision. If I do bail, it will be gradual because I have significant LCG. All funds go through periods of "under-performance"; so far 2021, not good. Was last year a "little" disappointing (relatively speaking) for some, maybe, BUT I will take 21% EVERY YEAR!!!
As has been mentioned to me numerous times, has the reason you purchased the fund changed? Its scope or approach? Asset bloat affecting performance, etc.
Good luck with your decision!!!
Matt

Although my time frames are fuzzy, I held this fund around ten years ago and sold it a year or two later based on similar performance deterioration. Then, I watched AKREX recover and outperform and got back in several years ago, and now plan on maintaining my position, monitor, and reassess in a few months. At only 1% of my portfolio not a major impact.

FWIW, I sold some time ago:
1. Akre himself was planning to step back.
2. Has become relatively ordinary in its performance.

I held AKREX from 7/2016, eventually it was my number 1 holing. By early 2020, I detected weakness in this fund. Started selling in April 2020 and nothing left on 6/29/2020. I know Mr. Charles Akre since the time he managed a small cap fund specialize in Finance sector and was # 1 for many years. he sold it to other mutual fund. Made lots of money from that fund. Then AKREX was formed. In my post dated 7/27/2020, I suggested to dump this fund for several reasons....Now, Mr Akre has retired.

Howdy folks,
As predicted the bosses got involved and raised the margin requirements for silver by 17.9 %.
That's OK. I'm not buying, nor selling.
Take care and stay safe,
Rono

GME dropped 30.77% today and at 12/31/20 they owned .91%, probably higher % now after the crazy January - GME up over 1,000%. Hopefully they will sell out soon.

I'll try to make this one of the last regular posts on this but there seems to be some interest...
MSSMX, DOWN fractionally today, appears to have been adversely affected, perhaps by one of the squeezed stocks. In a rush right now but will look at it later. Its 12/31/20 holdings are here under "Composition" tab:
https://www.morganstanley.com/im/en-us/financial-advisor/product-and-performance/mutual-funds/us-equity/inception-portfolio.shareClass.A.html

For our portfolio:
We slowly added more VWO and mathew asia past few days/week.
added GM & QQQ last wk
401k 80/20 still. [all aboard full streams ahead]
-------------------------------------------------
For Mama portfolio [retired] all new monies divs go to fidelity 2020 fund and BND FBND
In Texas ~ 25%s economy dependent on energy sectors. Maybe much more pains /sufferings ahead. we see at least 10% of shops small business/big business closing in our town near Austin. Hope we don't see more bankrupcies or see 1980s /2008s marketlike conditions [Main street issues overflow to Wall Streets]
Kind regards
JNN

There's something happening here
What it is ain't exactly clear
-Stills
"For What It's Worth."
...But... What's it worth? Russell 2K today up like crazy. +2.53%. I've only 10% in small-caps. But I still like my allocation. Don't like the volatility anymore.

Thanks for the clarification. My condolences to his family and friends.
Just received an email from GP concerning him:
February 1, 2021
Dear Fellow Investors,
It is with great sadness that we announce the death of our dear friend and colleague, Keefer Babbitt. Keefer was not only a great partner and friend, he also set the bar extremely high as it relates to his work. His character, work ethic, depth of thought and the quality of his output were greatly admired by all of us at Grandeur Peak. Keefer joined Grandeur Peak in 2012 as one of our first interns, and over the past 8+ years he has been a true builder of our firm. He made an enormous difference here and he will be greatly missed.
Keefer's current roles included co-managing the Global Contrarian Fund alongside Mark Madsen and Robert Gardiner, co-managing the Global Reach Fund with six other portfolio managers, contributing on our Industrials team, and of course first and foremost serving as a global research analyst. Given our unique team-based approach, we do not anticipate making any immediate changes to the portfolio management of either fund.
If you have any further questions, don’t hesitate to reach out to me or a member of our Client Relations Team.
Best Regards,
Eric

No surprise but the graphs are revealing.
"Although the distribution of income is unequal in the United States, ownership of financial assets in general and stocks in particular is even more so."
NY Times Article
By Robert Gebeloff
Jan. 26, 2021

Sad news. He seems to have left this world as well as his job.
https://www.legacy.com/obituaries/saltlaketribune/obituary.aspx?n=keefer-babbitt&pid=197603341&fhid=23304

https://www.sec.gov/Archives/edgar/data/915802/000139834421001942/fp0061786_497.htm
497 1 fp0061786_497.htm
FINANCIAL INVESTORS TRUST: GRANDEUR PEAK FUNDS
Grandeur Peak Global Contrarian Fund
Grandeur Peak Global Reach Fund
(the “Funds”)
SUPPLEMENT DATED FEBRUARY 1, 2021 TO THE SUMMARY PROSPECTUSES, PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION FOR THE FUNDS DATED AUGUST 31, 2020
Effective January 22, 2021, Keefer Babbitt is no longer serving as a co-portfolio manager of the Funds. Therefore, all references to Mr. Babbitt in the Summary Prospectus, Prospectus and Statement of Additional Information are hereby deleted as of that date.
INVESTORS SHOULD RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE.

One can research ownership info on M*. Each company's page has an "Ownership" tab, e.g. https://www.morningstar.com/stocks/xnys/gme/ownership
In addition to showing individual funds and fund complexes/institutions holding the largest number of shares, one can find the funds with the highest concentration of shares.
Theoretically an institution with a large number of shares can move the stock price, but this assumes it has the flexibility to do so (i.e. the shares are not in index funds with stringent constraints). What matters to fund investors is the ownership concentration in funds they own.
For example, SPDR S&P Retail ETF XRT has 19.34% of its assets in GME (per M*). According to the fund's web page, as of January 29th, that was 19.47% of the fund.
What Schwab Fundamental Large Company ETF FNDX is doing with 2½% (per M*) of its portfolio in GameStop is beyond me. I guess one has to read index providers' definitions carefully. According to Schwab, as of Jan 28, the fund's 1½% allocation to GME was its 5th largest, nestled between JPMorgan Chase (JPM) and AT&T (T).
Reuters may have confused Lipper data regarding two different Fidelity funds that are clones of each other. Fidelity Series Intrinsic Opportunities FDMLX is a $13.7B fund, while Fidelity Flex Intrinsic Opportunities FFNPX is a tiny $36M fund.
https://www.reuters.com/article/us-retail-trading-funds-idUSKBN29X0LZ
As of their latest quarterly reports (posted Dec 29, 2020), the Flex fund did have 0.639% of its assets in GME, but in such a tiny fund that amounted to nothing ($161K). The larger Series fund held 44x as much stock, but that constituted 0.59% of the fund. Close, the funds are clones, but not the same.
The Fidelity Series funds are for use by other Fidelity funds. So even the small 0.59% ownership is further diluted by its inclusion in other funds.
The Intrinsic Opportunities funds (both of them) are managed by Tillinghast. FLPSX's position in GME amounts to just 0.09% of the fund, as of its latest quarterly report.

@Derf,
It appears that enough FPA shareholders approved the merger. Found this filing by Bragg Capital this morning:
https://www.sec.gov/Archives/edgar/data/1170611/000110465921009595/a21-4366_1497.htm
Here is footnote concerning the merger:
"... Includes compensation from the Funds, FPA Capital Fund, Inc., (reorganized into Queens Road Small Cap effective February 1, 2021)..."
Checked my FPA Capital account this morning...my shares were switched to FPA Queens Road Small Cap Instl. shares as of this morning; shares were adjusted for the lower NAV of the FPA Queens Road Small Cap Instl NAV price than the FPA Capital NAV.
Just found these news releases:
https://fpa.com/docs/default-source/FPA-News-Documents/fpa-qr-capital-merger-press-release-final.pdf?sfvrsn=2
https://finance.yahoo.com/news/fpa-announces-completion-fpa-capital-143000983.html