Dear friends,
We posted our early autumn issue of the MFO monthly this morning. I tried to focus a bit more on individual funds that might be worthy of attention.
Seven Canyons World Innovators (WAGTX) started life as Wasatch Global Tech, morphed into Wasatch World Innovators, and following founder Sam Stewart to his new firm and became Seven Canyons World Innovators. The manager commentaries are unusually lucid and thoughtful. I'm struck, in particular, by their discussion of whether the entire (developed) world has become Japan: slow growth, aging population, vast debt, no room for more monetary stimulus and at risk of stagnation. Their argument is "true enough, but some Japanese firms did fabulously well. Let's learn from them." Both raw and risk-adjusted performance is consistently top tier.
Harbor Global Leaders (HGGIX) sort of caught Ed's eye about a month ago, and I promised to write a bit about them. The short story is that this used to be a Marsico-led fund and, three years ago, became of somewhat different Sands-led one. The Sands team has had top tier returns but ... their Lipper peer group is a bit squishy since it's a "global" group that includes domestic funds and their shareholder communications are pretty bad. Like Fidelity, Harbor uses a template for their reports which limits the manager to about 100 words of useful content and they don't push any material that's not required. As a result, my read on them is a bit thin.
Evolutionary Tree Innovators just launched with the leadership of a guy who used to be a bigwig at Sands Capital. The strategy seems to be an ... uh, evolution of the domestic large-growth strategy he helped pursue at Sands. Two problems. (1) A near-institutional minimum and (2) limited access to role in the non-public version of the investment vehicles.
The Matthews folks have moved to Artisan, but it looks like they'll be working with private rather than public vehicles.
Lynn Bolin does another rich job of reasoning through his shopping list. Lynn is skeptical of the state of markets and the economy over the next five years and was looking for funds that (a) have flexibility in their mandate and (b) use it well. There's ground for lively discussion there.
Speaking of "lively discussion," the off-topic board is less closed than it was. With any luck at all, I've succeeded in modifying the settings so that folks can post there but O-T posts don't appear on the "recent discussions" view that is the default landing page for the discussion board. That way, if folks want to participate in off-topic discussions they can but the landing page highlights on-topic discussions instead. Thanks, especially, to O.J. for helping me think about this.
And thanks, especially, to The Shadow. Usually Briefly Noted is the product of parallel investigations: Shadow tracks filings and I track filings, with his work helping me be sure that I haven't screwed up and missed important stuff. This month was vaguely a disaster for me and I was about 95% dependent on his finds. Fortunately, Shadow does amazing work, which saved me. So, thanks!
David

I created several watch lists at M*. See https://www.morningstar.com/portfolio-manager
This way I see 1-4 week momentum of my favorite funds that I keep updating which is important to me as a trader. I could not get it anywhere updated daily.
You can select many columns.

Joe Biden and Chris Wallace were not wearing masks during the debate so they will be tested. Question is is the 20' distance between the two candidates enough to avoid the airborne virus particles?
Biden's team wore masks while Trump's team did not. By Thursday, Hope Hicks was sicken along with several COVID-19 symptoms before the positive test result was made available. This means that she was a carrier at least a week prior to the debate. On Wednesday, the team were on Air Force One in close proximately and without face covering. This is quite a mess during this busy and yet critical time period.

@FD1k
>> 3) Healthcare got a lot more expensive since Obama care.
cites?
Here's one for ya:
https://www.statnews.com/2019/03/22/affordable-care-act-controls-costs/
@msf did a lot of substantiated posting in this area back when.

I'm not going to repost all that material, as people seem more interested in posturing with terse "narratives" and clickbait headlines than with numbers and objective analyses.
"Healthcare". What's that? National expenditures? National expenditures per capita? An analog of risk adjusted returns, e.g. improved health / change in cost?
"A lot more expensive". More expensive than what? Than it was in 2009? Certainly healthcare costs rise faster than inflation. That was true a decade ago, that's true now. So what? Not a single figure proffered, let alone two to show a comparison.
ACA "saved the U.S. $2.3 trillion"? Compared with what? "The bottom line: cumulatively from 2010 to 2017 the ACA reduced health care spending a total of $2.3 trillion."
National health expenditures in 2010 totaled $2.593T; by 2017 they totaled $3.487T. Each of the intervening years also experienced expenditures more than the 2010 baseline. Cumulatively, from 2010 to 2017 health expenditures increased by trillions of dollars.
https://www.cms.gov/files/zip/nhe-summary-including-share-gdp-cy-1960-2018.zip
"In 2017 alone, health expenditures were $650 billion lower than projected." So what's being compared are actual expenditures under the ACA with projected expenditures under the ACA. Actual expenditures being less that projected expenditures is evidence that projections didn't pan out, it's not evidence that the ACA had anything to do with it. Projected expenditures for 2017 may have been just as overstated under the old law as under the ACA.
As the column itself acknowledges, "Why have health care expenditures risen more slowly than projected? No one is entirely sure."
Here's a HealthAffairs piece on the subject:

Before the ACA, the uninsured rate hovered around 15 percent of the population. By 2018, that rate dropped to 8.5 percent, resulting in 18 million more people with coverage.
Efforts to achieve other policy goals were less successful. The ACA did not stem high and rapidly rising health care costs care for all Americans. Delivery system reforms advanced by the Centers for Medicare and Medicaid Services (CMS) Innovation Center have shown disappointing results, and mechanisms intended to rein in federal costs have been dropped.

https://www.healthaffairs.org/do/10.1377/hblog20200406.93812/full/
Regarding Obama's claim that family's premiums would be lowered by $2500, the opinion piece says that "the ACA has more than delivered on that promise, saving about $4,000 per family."
As I explained above, and the Health Affairs piece details, statnews' calculation of realized "savings" is flawed. Large savings have not been realized, nor, Obama's rosy projections aside, were they expected.
The 2009 CMS projections (pp. 16-18) cited by the statnews column, discusses the sources of savings. It characterizes the Act's expected impact as moderate: "overall moderate effects of the PPACA on NHE [National Health Expenditures]"
FactCheck (2008): Obama’s Inflated Health ‘Savings’, substantiates the CMS writing.
https://www.factcheck.org/2008/06/obamas-inflated-health-savings/

To ram through his 11th-hour Supreme Court nominee El Gran Jefe introduced Barrett to many senators who were maskless like him: https://politico.com/news/2020/10/02/trump-coronavirus-lawmakers-exposed-425026

With Trump, his wife, and Hope Hicks all testing positive for Covid 19, it is going to challenging for the market to be positive. I personally would be on the sidelines, to see how this is going to play out.

Numbers as of 9/30/2020.

Observations for one month as of 9/30/2020:
Multi- Flat for the month but securitized shined with 1-2.9%/
HY Munis – Flat for the month but Nuveen (NHMAX,NVHAX) did better.
Inter term – (-0.1%) for the month. TGLMX (mostly securitized) did 0.4%.
Bank loans – up 0.3-4% for the month.
Uncontrain/Nontrad -0.2 for the month. Securitized(JASVX,DFLEX)
HY+EM – HY -0.9 and EM=-1.7% for the month with correlation to stocks.
Corp – down month. PIGIX -0.4%.
SP500(VFIAX)-Down monthth at -3.8, YTD=5.55%.
PCI-CEF huge upside at 7.1%. YTD still at -13.7%
My own portfolio
I started the month with IOFIX+DFLEX and replaced DFLEX with JASVX+NHMAX. It’s pretty obvious that funds loaded with securitized bonds are doing well. HY Munis don’t have a momentum yet but I bought NHMAX because it’s in my taxable and it showed a better momentum than others but the last 2 days are down, I was too early but now I’m watching closely. It was another good month for me.

FD, what is the source for the chart you posted? Many thanks.

Always masterful ...
https://am.jpmorgan.com/blob-gim/1383407651970/83456/MI-GTM-4Q20.pdf?segment=AMERICAS_US_ADV&locale=en_US

inclusion is not the only thing, of course
https://www.nytimes.com/2020/10/01/opinion/trump-biden-economic-policy.html

Sure, healthcare: https://thehill.com/policy/healthcare/517708-despair-at-cdc-after-trump-influence-i-have-never-seen-morale-this-low

It just seems that there is too much uncertainty right now to risk much in bond investing. I prefer to let the election get resolved, hopefully see more certainty in the Covid 19 battle, see if we can provide essential government support to stabilize the market, and then see what looks more promising going forward. I think there is just too much guess work involved in risking major investing actions for now.

yup, not much going on in bondland. have you traded PCI at all? seems to have some pretty good momo, if'n that's your thing.

There is not a lot? Check several Multi sector funds for 1-3 months :-)
I usually don't invest in PCI/stocks because of their volatility but after I sold everything late Feb+early March I made several successful trades using PCI (twice) + QQQ.

Point of order?
Would it be permissible here to note that former President Jimmy Carter turns 96 today?
Full Story

@FD1k
>> 3) Healthcare got a lot more expensive since Obama care.
cites?
Here's one for ya:
https://www.statnews.com/2019/03/22/affordable-care-act-controls-costs/
@msf did a lot of substantiated posting in this area back when.

@LewisBraham
My key point: Trump is the first president since 1998 to increase the median income significantly but I can't find it in the Lib media.
...

huh?
https://www.census.gov/library/stories/2019/09/us-median-household-income-up-in-2018-from-2017.html
what are we missing in understanding your assertion?

Numbers as of 9/30/2020.

Observations for one month as of 9/30/2020:
Multi- Flat for the month but securitized shined with 1-2.9%/
HY Munis – Flat for the month but Nuveen (NHMAX,NVHAX) did better.
Inter term – (-0.1%) for the month. TGLMX (mostly securitized) did 0.4%.
Bank loans – up 0.3-4% for the month.
Uncontrain/Nontrad -0.2 for the month. Securitized(JASVX,DFLEX)
HY+EM – HY -0.9 and EM=-1.7% for the month with correlation to stocks.
Corp – down month. PIGIX -0.4%.
SP500(VFIAX)-Down monthth at -3.8, YTD=5.55%.
PCI-CEF huge upside at 7.1%. YTD still at -13.7%
My own portfolio
I started the month with IOFIX+DFLEX and replaced DFLEX with JASVX+NHMAX. It’s pretty obvious that funds loaded with securitized bonds are doing well. HY Munis don’t have a momentum yet but I bought NHMAX because it’s in my taxable and it showed a better momentum than others but the last 2 days are down, I was too early but now I’m watching closely. It was another good month for me.

An example of how Covid-19 effects continue to ripple through the economy. Forbes
“ In March ... American Airlines, without notice, cancelled its order for 1.35 million bags – or 1.7 million pounds – of mixed almonds, cashews, pecans and pistachios, the much-loved mix that it had been serving warm to its premium-class passengers for more than 30 years.“
-
Related : After posting the above, this more sobering story broke:
Fort Worth-Based American Airlines to Cut 19,000 Jobs CNBC
The flowers died on fields of hope
All the way from east to west
Where the mighty winds will blow
I'll put my dreams to rest
This scary monster is very much alive
Like a hundred years ago
From: The World We Used to Know

You can actually sell or buy both....it’s just you do so for different reasons. But a call gives the holder the right to buy the underlying security (if exercised)....and the put gives holder the right to sell the underlying security.
I’m by no means an expert! And VF got me thinking about using this for income again (I have done covered-calls for several years now). But I’ve been noodling around with selling some out of the money puts (thereby “going short” on the put) on triple-digit-priced stocks for 1-6 weeks out.....hoping to not have it exercised, and it “sidelines” the money required to purchase the underlying stock, at the exercise price, for the duration that the put option is held short.
Also, when buying calls (“going long” a call), most do this to take advantage of a price increase on the underlying stock (bullish stance) without having to put as much capital at risk (theoretically, only the cost of the call premium is put at risk). Sometimes, you can make more when a stock increases by holding the call option, depending upon maturity and how far out of the money the exercise price is. Many do not hold the option until expiration/exercise, but trade in the value of the option contract itself.
It seems very complicated when you explain it, but if you paper traded some options (maybe on the CBOE website or something?), it makes a little bit more sense. But I have very little idea when it comes to option spreads (multiple options on the same security)....
Sorry to hijack the thread! :)

he got healthcare done, bwahaha

wait, maybe he did, and is !
https://thehill.com/opinion/healthcare/518584-yes-trump-has-a-health-care-plan-he-has-been-implementing-it

The above report is from 2015. What happened to Median household income in the United States from 1990 to 2019? It went up very nicely from 2015 to 2019 under you know what president

Correlation is not causation.