Hi @FD1000,
Thanks for posting this fine peace for reading. For me, it was a very interesting read.
Skeet

This post also mentioned LDVIX:
https://www.mutualfundobserver.com/discuss/discussion/39017/mutual-funds-weekly-roundup-february-22/p1

A great article (link). Below are several quotes from this link.
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What do you expect to be the key driver of stock market performance over the course of 2020?
Markets climbed a wall of worry in 2019 and nearly all risk assets did very well - essentially the opposite of 2018. We believe we have entered the fear of the fear of missing out. One thing we are watching closely are equity fund flows that were down last year. It's very rare for fund flows in stocks to be negative when the market is up so strongly. But recent data suggests that may be turning. It would be a bearish signal for us to see a large amount of new money flow into equities.
According to Goldman Sachs, two thirds of the market move since 2009 has been earnings growth. However, in 2019, just 8% of the S&P 500 move is explained by earnings growth.
We tend to be bullish when others are bearish and tend to get bearish when others are bullish. Last year, investors were maybe not bearish but definitely cautious given the trade worries and other geopolitical issues. However, today we seem to be moving toward a more euphoric phase which does have us concerned.
What do you expect out of the yield curve in 2020 and what impacts will that have on the bond market and the economy in general?
On the long-end of the curve, we think rates could inch higher but shouldn't jump significantly like we saw in 2017. If I had to make a bet where the 10-year yield will be at year end, I would say around 2.15%.

What are some portfolio tilts and sub-sectors you think investors should focus on this year?
We believe this year could look a lot like 2017 with some minor changes. First and foremost, we think the dollar rolls over and starts to decline. Dollar strength was largely due to the Federal Reserve raising rates for the last few years through 2018. With the Fed lowering rates three times last year (-75 bps) that should start reverberating throughout the markets this year, especially the dollar.
If the dollar does start to decline, we think international equities could finally shine. They have drastically underperformed US equities in the last 10 years. However, they should rebound. Europe and Japan have experienced much slower growth than the US during the recovery and continue to have worse demographics.
In fact, from a valuation standpoint, US stocks have never been more overvalued relative to the rest of the world. This is eventually likely to mean revert and we think a lot of it is due to the negative sentiment regarding the euro and Brexit.
Value stocks may finally do better than growth stocks thanks to the steeper yield curve. The thesis of owning growth stocks during a flattening yield curve and value stocks during steepening could prove true here. We also like small caps more so than large caps (and especially mid caps) given the 20-year low relative valuations. Emerging markets look particularly interesting.
I would still stay away from energy which looks like is going through a secular shift away from fossil fuels.
In fixed income, where are you allocating capital for 2020?
1) Municipals: We've been pushing munis for most of the last year as rates appeared poised to drop. Even today, we think rates pushing 2.00% are not a bad place to put capital. And when you factor in the tax equivalent yields of munis (especially muni CEFs), and consider the risk of these securities which is extremely low, it's hard to beat this sector.
(2) High Yield / Floating Rate: . At these levels, we would say investors in high yield are coupon clippers, meaning that you are likely to receive the yield only with little to no capital gains. The risk is to the downside.

Our favorite area of the market remains mortgages (for the third year in a row). We place them into the high yield/ floating rate sector simply because of our focus on non-agency MBS, which tend to be unrated or lumped into non-investment grade/high yield. Many of these mortgages also are floating rate. Our thesis remains that the investors tend to fight the last battle, which with the Financial Crisis centered on the mortgage market.
(3) Real Assets / REITs: The sector was an under performer in 2019 and we think could be one of the best performers in 2020 as rates stabilize. The fourth quarter of 2019 was the driver of that underperformance as investors moved back to a risk-on environment and away from the "bond proxies."
Total cash returns could be as good as 9% in 2020 with approximately half coming from the yield and 4% to 6% earnings growth. If we see rates meander lower, we think there will be renewed interest in the sector which could help push up prices further. Fundamentals in the sector are strong with property values continuing to move higher.
(4) Preferreds:The asset class is small and has low liquidity which tends to exacerbate the moves lower. It's when these liquidity-induced selloffs occur that you should be buying shares of high quality names. While most talking heads poo-poo preferreds when rates are rising due to their perpetual maturities, this can be an advantage for retail investors. When rates fall, the issuer can call the shares at their discretion and replace them with a lower yielding issue. Today, we are seeing "refinancings" occur even if they can save just 50 bps of interest expense. If rates rise, while the "perpetual value" of your shares may go down, it does lock in your income stream for longer.
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FD: and this is why most of my money is in HY Munis + Multisector specializing in MBS/Securitized

https://www.fa-mag.com/news/avoiding-the-perils-of-behavioral-investing-mistakes-53613.html
Avoiding The Perils Of Behavioral Investing Mistakes
JANUARY 15, 2020 • MATTHEW WILSON
There’s no shortage of research showing how investors are often their own worst enemies, sabotaging themselves by making emotional decisions or resorting to market timing and performance chasing (Source: 2018 Dalbar Quantitative Analysis of Investor Behavior).

@VintageFreak - Treasuries and Treasury MMFs generally pay less than corporate bonds and prime MMFs. VUSXX is no exception.
I was addressing the comment that Vanguard Prime MMF was safer than anything other than a bank account (which also implies that bank accounts are the safest possible places for money).
Prime MMFs, whether Vanguard's or anyone else's can break a buck. To lessen this possibility, they are required to freeze withdrawals and/or impose a redemption fee in times of stress. That's not a requirement imposed on VUSXX or any MMF that holds exclusively federal obligations (even if not backed by the full faith and credit of the government). Those funds are safer.
In term of safety, prime money market funds are less safe than bank accounts (backed by FDIC, not full faith and credit) and MMFs holding government debt, which in turn are less safe than Treasury debt and Treasury MMFs.
Conversely, Treasury debt would be expected to pay less than government debt which would be expected to pay less than corporate debt. Same for MMFs: prime MMF pays more than gov MMF pays more than Treasury MMF.
The greater the risk, the greater the reward.
Though in a taxable account in a state with a 10% income tax, that 1.7% yield, after taking out state income tax, leave one with just 1.53%, just about what one gets with the Treasury MMF. Extra safety at no extra cost, depending on one's situation. Occasionally, rarely, there is a free lunch.

@msf I thought VMMXX provided a higher yield than VUSXX. I will take a look. If difference not substantial, I should switch.
EDIT: VMMXX --> 1.7%, VUSXX --> 1.54%

There is a reason majority of my cash is in VMMXX...the only thing safer would be a bank money market fund. I do have a smattering of RPHYX and RSIVX.

While I agree that a bank money market account, so long as it were within FDIC insurance limits, would be safer than VMMXX, I consider VUSXX to be safer still.
VMMXX holds corporate debt and can break a buck. While it is the "sense of Congress" that the FDIC is backed by the Treasury, there is no statute providing that level of backing. In contrast, the treasuries held by VUSXX are backed by the full faith and credit of the US government.
Dancing on the head of a pin, perhaps.
As of 1/14/20, M* reports identical 1 year returns for VMMXX and RPHYX of 2.20%, which means that RPHIX has returned about a quarter percent more than the MMF (no 12b-1 fee).

Both M* and Schwab uses the following information in describing assets, based on information provided by the fund company.
M* definition of "cash equivalent":
Cash Equivalent
Assets that can be quickly converted to cash. These include receivables, Treasury bills, short-term commercial paper and short-term municipal and corporate bonds and notes.

When giving quotes, it helps to provide a citation to the source as well as name it. That makes it clear exactly which definition you are using from the source. The same source may offer multiple definitions.
For example, the M* definition you gave can be found (among other places) in its investing glossary
https://www.morningstar.com/InvGlossary/Default.aspx?letter=C
Just follow the Cash Equivalent link,
All well and good. Now since we've decided to use M*'s glossary as the source of the definitions, and what we're concerned about is not cash equivalents per se, but what M* means by the percentage of cash it presents for a fund, we should look the at the glossary entry for Percentage Cash. That is just what I cited before.
It might be helpful if I reproduced the complete entry for that term, since M* makes clear that this defines how it computes the 47% figure you quoted.

This data point identifies the percentage of the fund's net assets held in cash.
Cash encompasses both actual cash and cash equivalents (fixed-income securities with a maturity of one year or less) held by the portfolio plus receivables minus payables.
Negative percentages of cash indicate that the portfolio is leveraged, meaning it has borrowed against its own assets to buy more securities or that it has used other techniques to gain more than 100% exposure to the market.

It doesn't matter how M* defines "cash equivalent" generally; what matters is how it defines it for the purpose of computing percentage cash.
For some purposes, and I'm not sure which, in 2016 M* redefined cash equivalents down from 364 day maturity to 92 day maturity. Since the definition you quoted doesn't include a time frame (neither a year nor a quarter), to be consistent I expect you would disregard this definition also.

What are the changes to the Global Fixed Income Sector Classifications?
Within Morningstar's fixed-income classification processes, we use instrument attributes to determine which positions should be treated as cash and cash equivalents. Morningstar previously based the assignment on an instrument being an eligible type of fixed-income instrument with a maturity of no more than 364 days. Morningstar will reduce it to 92 days to align with regulations and the broader investment industry. Additionally, we’re making minor refinements to the determination of which securities, accounts, loans, and derivatives will be subject to this reclassification to cash.

http://advisor.morningstar.com/Enterprise/VTC/FAQ_Methodology_Enhancements_31_October_2016.pdf
My takeaway from this FAQ is not that M* has altered how it calculates "percentage cash". Rather, the text states that industry standard for "cash equivalents" excludes securities with maturities over three months, even if they fit the definition you gave.
P.S. Regarding Schwab's figures and definitions: "Except as noted below, all data provided by Morningstar, Inc." Schwab is not using data provided by the fund company, except indirectly, via M*. It's a tertiary source.
https://www.schwab.com/public/schwab/investing/investment_help/investment_research/mutual_fund_research/mutual_funds.html?path=/Prospect/Research/mutualfunds/summary.asp?symbol=RPHYX

It is interesting that this fund reopened now, after a significant slow down: During the last 1/2 year it reached a plateau with almost zero slope (no return). The only time it happened in the past it was in 2015, see M*

@finder - Right on. I noticed the same, that the Vanguard Money Market VMMXX has a higher one year return than RPHYX. RPHYX lost its magic?

It is interesting that this fund reopened now, after a significant slow down: During the last 1/2 year it reached a plateau with almost zero slope (no return). The only time it happened in the past it was in 2015, see M*

msf: "When giving secondary source figures, it helps to cite the source. I'll guess that you're looking at M* (47% cash as of Dec 31). M* has its own definition for cash that distorts figures for funds like RPHYX."
Yes, the 47% figure came from M*, and yes before you make a decision to purchase, it is important to go to the website. I doubt you will ever see ZEOIX at 47% cash, as they seem pretty committed to stay fully invested, but with RPHYX, you do see higher cash figures periodically in a calendar year. I am not sure that what M* does should be labeled as "distorting" figures, but they do include things that are both cash and "cash like" in their figures.

Thanks for letting us know this, David, and for bringing this valuable fund to light in the first place. I've got a small stake in my taxable account, but I've been waiting for a chance to get it in my solo 401K, where right now I've got a lot of cash parked.

RPHYX also reduces risk by holding a much higher percentage in cash (about 46%),
I try to go the horse's mouth. The latest annual report, Sept. 30, 2019, Statement of Assets and Liabilities (according to GAAP, see note 2 for the statement) gives the cash and cash equivalent holdings as $4.56K out of $809K, or less than 6% in cash.
When giving secondary source figures, it helps to cite the source. I'll guess that you're looking at M* (47% cash as of Dec 31). M* has its own definition for cash that distorts figures for funds like RPHYX.

Cash encompasses both actual cash and cash equivalents (fixed-income securities with a maturity of one year or less) held by the portfolio plus receivables minus payables.

https://www.morningstar.com/InvGlossary/percentage_cash.aspx
Certainly much of what RPHYX buys has short maturities. That's by design. But they still have non-cash-like attributes.

The issue I have with ZEOIX is it isn't on NTF transaction free platforms at brokers. My understanding is this is by design as the managers don't want hot money or to pay to be on those "free" platforms. The problem is this is a low returning cash-like/short-term bond investment. So if you're a retail investor who maybe puts in a few thousand, say $5,000, and end up paying a $50 transaction fee, well that's 1 percentage point of your return over the next year and ZEOIX might deliver 3% on a year, so you've lost one-third of your return. Then because it is cash-like, let's say the stock market dips or falls flat on its face, well you might want to move some of your money out of cash or ZEOIX to buy some stocks. Well, then you've lost another 1/3 of your return doing that with the transaction fee. It's lack of liquidity for a short-term bond fund at brokers is problematic. And even if you buy it directly from Zeo and don't pay a fee, well again, let's say you see an opportunity to buy stocks, do you have to call Zeo to liquidate, transfer that money to your broker to buy the stocks? To me the hassle seems not worth it for many investors. I think if the managers want to prevent hot money, they could employ a short-term redemption fee that makes investors hold for a few months but lets them trade freely once that period ends.

"wxman123">What would be the argument to choose this fund over Zeoix (better performance) or BBBMX (better and even safer)?
When I compare the 2 funds, RPHYX is less risky compared to ZEOIX. RPHYX has a portfolio credit rating of using BB rated corporate assets, compared to B rated for ZEOIX. RPHYX also reduces risk by holding a much higher percentage in cash (about 46%), compared to about 5% cash for ZEOIX. Also RPHYX does not require redemption fees compared to ZEOIX. When you look at performance charts, you see the lower volatility/standard deviation in RPHYX, and in the toughest downmarket for the 2 funds (2015/2016), RPHYX showed almost no dip, compared to a slight dip for ZEOIX. As a result of the 2 similar funds, you get a safer fund in RPHYX that performs more like a Money Market fund than RPHYX, but with ZEOIX you get more yield, with a bit more long term return, and a fund that stays largely invested in corporates. For an investor, who wants a fund more like cash, RPHYX is a bit more similar without redemption fees.

I've read elsewhere that $50K is a bare minimum for muni diversification, which would mean 10 bonds, not 20. Still not the same thing as picking up a couple of T-bills.
Munis, like Treasuries, have become more attractive for middle income couples, who may no longer be deducting state income taxes because of the $24K standard deduction and/or the the $10K cap on SaLT deductions.
While technically munis have had a negative correlation with the S&P 500 over the past decade (mentioned in M* article), it may be more accurate to say there's been no correlation at all, positive or negative. The coefficient of correlation was -0.02, making the R-squared 0.0004.
https://www.lordabbett.com/en/perspectives/marketview/municipal-bonds-look-beyond-tax-free-label.html

Gary1952">Who is buying ZEOIX and where? Schwab has a $49.95 transaction fee plus a 1% redemption fee. Seems restrictive for a $1500 min. purchase amount.
I looked at ZEOIX closely at the end of 2019/beginning of 2020, as a possible landing spot, for some RMD money I was depositing in my taxable account. From my perspective, it is a very good option as a cash alternative fund, with a very smooth and solid history of consistent performance. However, I opted to pass on it for now, as I do not like funds with redemption fees, and as you noted at Schwab you are also required to pay transaction fees. I decided to put that money into some existing non-traditional bonds I own, and continue keeping it on a watchlist for possible future investing.

Here is the link:
https://www.sec.gov/Archives/edgar/data/1494928/000139834420000731/fp0049672_497.htm
497 1 fp0049672_497.htm
RiverPark Funds Trust
RiverPark Short Term High Yield Fund
Institutional Class (RPHIX)
Retail Class (RPHYX)
Supplement dated January 14, 2020 to the Summary Prospectus, Prospectus and Statement of Additional Information (the “Disclosure Documents”) dated January 28, 2019.
This supplement provides new and additional information beyond that contained in the Disclosure Documents and should be read in conjunction with the Disclosure Documents.
IMPORTANT NOTICE ON PURCHASE OF FUND SHARES
Effective as of the close of business on January 15, 2020 (the “Re-Opening Date”), the RiverPark Short Term High Yield Fund (the “Fund”) will be publicly available for sale without limitation.
The Fund may from time to time, in its sole discretion, limit the types of investors permitted to open new accounts, limit new purchases or otherwise modify the above policy at any time on a case-by-case basis.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE.

+1.

Thank you David, but not available yet at Schwab. I'll keep trying.

1.This fund is closed to new investors. Only accounts which currently have a position in this fund may place a buy order at this time.