On Wednesday July 22st, we will host a webinar discussing latest features of the MFO Premium search tool site. Topics will focus on improvements made to the main MultiSearch tool, including:

• Searchable Holdings Data (Company, Country, Industry)


• Expanded Equity Portfolio Metrics


• Multi-Year and Ferguson Ratings


• Yearly Return and Fixed Periods Ratings


• Bond Credit and Duration Breakout


• Current Month Inflow and Outflow Estimation


• Searchable Exchange Traded Notes (ETNs)


• Nine New Evaluation Period (e.g., Trump Bump, CV-19 Bear)


• Larger Watchlists with Customizable Names

There will be two sessions, one at 11 am Pacific time (2pm Eastern) and one at 2pm Pacific time (5pm Eastern). The webinar will be enabled by Zoom. Please use the following links to register for the morning session or afternoon session. Each will last nominally 1 hour, including questions.

Here are links to previous webinar charts and video recording.

Hope to you can join us again on the call. If you have any questions, happy to answer promptly via email ([email protected]) or scheduled call.

"The Predecessor was an unregistered private fund, did not qualify as a regulated investment company for federal income tax purposes and did not pay dividends or distributions." (from prospectus)
Note also that Legg Mason funds (including Brandywine) should be acquired by Franklin Templeton this quarter. Shareholders have approved this transaction.
https://ir.leggmason.com/file/Index?KeyFile=404021514

https://www.sec.gov/Archives/edgar/data/1474103/000168386320007908/f4892d1.htm
Based on the filing, it was previously an institutional class fund.
Excerpt:
This fund is the successor to an institutional account (the “Predecessor”). The performance prior to May 31, 2016, in the accompanying bar chart and table is that of the Predecessor.
The fund was formerly Legg Mason BW Global Flexible Income Fund.
https://www.sec.gov/Archives/edgar/data/1474103/000119312517331274/d473478d497.htm

Good thread. In mid march I posted about initiating a “gradual rotation” from RPGAX into DODBX. Since accounts are directly with the respective houses, what I did was shift (eventually 100%) of funds from DODIX into DODBX. And, at Price, I shifted corresponding amounts out of RPGAX into TRBUX (ultra short).
Long story short: The move hasn’t made much difference to date. Over 13 weeks DODBX leads RPGAX at last look, but only by a slim margin. One benefit to me - the RPGAX shares sold were all from a Traditional IRA, while DODBX is in a Roth. Since markets did well over those 13 weeks, I’m a bit ahead re tax positioning. BTW - I still own RPGAX within my Roth.
Gave a lot of reasons & thinking when I posted in mid March, so won’t repeat here. FWIW - the thinking expressed back than hasn’t changed.

LFLAX and LFLIX are two share classes of the small ($17M) that appears to exhibit a low risk high return profile (mostly US Corp debt). Anyone heard of the fund?
Also, I would like to avoid the $50 TF for the lower ER share class (LFLIX) when purchasing at TD Ameritrade...any thoughts?

Thanks for the suggestion. Certainly the CMBS portion of the portfolio is one of the most likely candidates.
Almost all the CMBS holdings are derivatives and I really didn't want to get into estimating their yields. So I started with the assumption that within CMBSs, yields would tend to be similar. Thus I looked at the more basic securities.
My source of prices was the annual report that valued the securities as of March 31, ISTM any bargain basement purchases in March were already priced in. For example, there's a non-agency CMBS, BBCMS Mort. Trust, Series 2020-C6, Class F5TB 3.69%. (In the BBCMS Mort. Trust prospectus, it's Class F5T-B.) With principal of $75K, its current value (March 31) is given as $46,675.
Fund Annual Report
BBCMS Mort. Trust Prospectus
This security represents a mortgage on a single property, F5 Tower in Seattle (built 2019, 100% occupied), with an anticipated repayment date of January 6, 2030 (final maturity in 2033).

The prospectus gives the average weighted life as 9.91 years (about 119 months). The security was issued in mid February. That's close enough to the March 31 date of the fund's annual statement not to worry about the difference in dates.
The annual statement gives the principal amount as $75K and the current value as $46,675. With this information (and the info in the SEC filing) I could approximate the yield going forward.
To figure out the monthly payments received (principal and interest) I used an amortization calculator, and 119 months. (Outstanding principal doesn't change enough in the month from Feb to the March annual report date to worry about adjusting this.)
$75K principal, 3.69% average weighted rate (per SEC filing) gives monthly payments of about $754.
Since the fund valued the holding at $46,675, the question becomes: what would the rate be on a $46,675 mortgage (119 months) to require payments of $754? The answer is about 15%.
That's in line with the fund's yield. Good, but not enough to compensate for the lower yielding securities held by the fund, let alone its large cash position. The bottom line is that I still agree that the CMBS derivatives are a good place to search for the higher yielding securities.

The IRS has indicated that the first and second quarterly estimated tax payments for 2020 may be combined into one single payment due by July 15, 2020:
https://www.irs.gov/newsroom/irs-july-15-tax-payment-deadline-approaching-plan-on-scheduling-multiple-payments-now#:~:text=Taxpayers who owe a 2019,combined into a single payment.

I'm reviving this thread to ask the community their feeling about 2020 CG & Div distribution estimates compared to 2019. Higher - Lower - Same? The July 15 deadline for 1st and 2nd quarterly estimated tax payments is approaching and I'd like to be in the ballpark. I have Vanguard, FIDO, and TRP, but no specific sector concentration. The market looks a lot different now than it did back in March.

During the down turn, I didn't really sell equity funds but I did rearrange my International holding back in early April. I always hold my breath when I swap funds but this time it paid off. Wondering if anyone else did the same.
I held SFGIX as my EM fund and FMIJX as my International holding for many years. I don't like to hold to many funds in a category so I decided to swap all or some of both funds for one fund that recently became available after being closed for a while, ARTYX. I sold all my SFGIX and put it into ARTYX. I held SFGIX from the start and I think became married to it. But, with a historically better performing fund available I made the switch. I sold all of SFGIX and put it into ARTYX. As I watched this new fund perform I decided to sell most but not all of my FMIJX and add that money to ARTYX. Sooooo happy so far. I held out a long time expecting better results from SFGIX and FMIJX that never came.
Anyone else make adjustments fund-for-fund like this. Again, I held SFGIX and FMIJX for so long and defended their poor performance the past few years. But I bit the bullet and divorced them.
since April 1st:
ARTYX +38%
FMIJX +14%
SFGIX +19%
Anybody else trade like-funds?

Inflation-indexed bonds fill an important gap in the fixed income market. Regular Treasury bonds are riskier than they seem – long-term Treasuries fell 60% in inflation-adjusted terms between 1940 and 1981. Minimizing duration is not a solution since real rates for short-term Treasuries have been as low as -9%. TIPS solve these issues by offering a safe bond investment not vulnerable to inflation.

5 Part Series:
Part 1:
history-of-tips-and-how-tips-bonds-work/
Part 2: How to Hedge Inflation and Avoid the Biggest Bond Risk
how-to-hedge-inflation-and-avoid-the-biggest-bond-risk/
Part 3: The Largest Arbitrage Ever Documented – TIPS in 2008
the-largest-arbitrage-ever-documented-tips-in-2008/
Part 4: Debunking TIPS Tax Inefficiency + A Tax Deferred Alternative
/debunking-tips-tax-inefficiency-a-tax-deferred-alternative/
Part 5: When TIPS Outperform and How I Invest in Them
when-tips-outperform-and-how-i-invest-in-them/

Because of the low AUM, they own very illiquid, very high yielding bonds. The volatility of these bonds is probably much higher than what the Morningstar performance chart suggests, but due to the illiquidity, you don’t see the big price swings.

As @LewisBraham wrote, "mutual funds are restricted to a maximum private equity exposure of 15% for liquidity reasons. There have been disastrous examples despite those constraints. f I recall correctly, the Van Wagoner funds were among the worst."
A current SEC regulation prohibits funds from acquiring illiquid securities if they would put the fund over the 15% threshold. Further, should a fund drift over that limit, it is required to create a plan to get the fund back into compliance within a reasonable amount of time.
A key facet of the regulation is its definition of "illiquid": An illiquid investment is an investment that the fund reasonably expects cannot be sold in current market conditions in seven calendar days without significantly changing the market value of the investment.
https://www.sec.gov/divisions/investment/guidance/secg-liquidity.htm
The Van Wagoner funds predate this regulation by a decade or two. So it's not an example of a disaster in spite of this reg. However, Big Tom gave a different example that is more problematic:

An investor only has to look at what happened to Third Avenue Focus Credit fund to see the result.

In theory, if a fund is 15% illiquid, it could sell off all assets for at least 85% of NAV (recovering 100% of the value of its liquid securities by definition, and 0% or more on the illiquid securities).
What happened with Focus Credit was that in no small part because of withdrawals, the fund shrank about 40% in half a year. Even with this stress, the fund barely exceeded the 15% illiquidity limit. Nevertheless, at that point, the fund halted redemptions, saying that it could not sell off enough assets at "rational" prices.
It is worth noting that shareholders ultimately recovered 85% of the NAV as of the date the fund halted redemptions, Dec 9, 2015.
https://www.nytimes.com/2016/01/12/business/dealbook/a-new-focus-on-liquidity-after-a-funds-collapse.html
https://www.reuters.com/article/us-thirdavenue-settlement-idUSKBN1722N4
Funds like IOFIX must comply with this reg. In fact, the IOFIX summary prospectus says: "The Fund may hold up to 15% of its net assets in illiquid securities."
The poor performance of IOFIX and its close peers suggests there's something inherent in the nature of their portfolios beyond having 15% (or less) in illiquid securities. Such as the remaining securities being liquid most of the time, but not under exceptional conditions (as opposed to the "current market conditions" of the regulation). Which unfortunately is precisely when one demands liquidity.

would you attribute the relatively small 5.2% peak to trough loss from 3/15 to 3/25 to the illiquid nature of many of these holdings not being priced mark to market?

Funds are required to price their securities daily. That this is difficult does not relieve them of this responsibility or allow them to cheat investors by misrepresenting prices. (IMHO the poster child for that sort of cheating is Heartland Funds.) They must mark to market, albeit with fair value pricing as needed.
From the NYTimes article link above:

Regulatory experts say that if the S.E.C. does decide to crack down on Third Avenue, it will be related to this pricing issue ... The message was clear: Mutual fund boards are responsible for making sure that the investment adviser acts responsibly in pricing securities and ensuring there is enough cash on hand for investors looking to sell.
But experts worry that mutual fund boards these days do not have the expertise or the muscle to do this job effectively.

I figure that TCW/MetWest has the necessary expertise.
Regarding volatility, I believe you'll find that this fund is using some of the same techniques that Bob Rodriguez used over at FPNIX to manage a very stable, albeit low-yielding fund. Which brings us full circle back to the question of where those interest payments are coming from.

Some funds use derivatives, leverage and/or high yielding/illiquid bonds to juice returns.

I don't see leverage here, and as I just noted, the other tools can just as easily be used to reduce volatility. Can you point to securities that juiced returns to 18%? I haven't found them yet.

BigTom, I do see this fund as aggressive for a bond holding, but I think there is room for aggressive bond funds within an overall portfolio, especially when managers like Scott Minerd are saying stocks are priced for perfection but there is still value in certain sectors of fixed income.

That's correct. It depends on your style, age and goals. I use mostly bond funds and doing pretty good.
In the biggest meltdown in the last 10 years, MWFSX peak to trough was about 6%, VCIF was about 13%, BND (US bond index) all investment grade was about 6.5%. It shows that MWFSX managers did a great job. Is it a guarantee? of course not.
BTW, the Portfolio Composition(Characteristics,Sector Weight,Credit Quality,Duration Maturity) for MWFSX is as of 5/31/2020 based on real data. See (link).
Another observation, the monthly yield keeps getting smaller in the last 5 months.
So, only you can make this decision after gathering all the information.

I owned IOFIX on/off for months until I sold almost all my funds to cash on February 29. I posted at this thread earlier (link)
February 29 edited February 29 Flag
@mark
This is a very unique time for me and why I will answer your question:-)
My goals as a retiree are: I need to make only 4.5% including inflation (Based on 2019, maybe I need only 4%) average annually to sustain our standard of living. But, I still want to make 6% with the lowest volatility (SD < 3) and never lose more than 3% from any last top.
YTD mostly in 2 bond funds investing at a higher % in NHMAX + lower % in IOFIX. Last Thursday, I sold half of NHMAX. On Friday, I sold all of NHMAX + most of IOFIX. This YTD (chart) is the answer to why.
Bottom line: I never buy at bottoms because I'm a momentum investor using charts and trends. At the bottom, the trend is down. I only buy when trends are going up.

Interesting. IOFIX, one month, 4.71%

Interesting.
IOFIX -22.8% YTD for a BOND fund.

Interesting. IOFIX, one month, 4.71%

https://i.ibb.co/pwD0dNk/image-1.png
https://i.ibb.co/BfvRMPZ/image-2.png
Observations:
Last month was another good month. Several bond funds made as much or more money than stocks.
Multi- another good month, several did over 2%. MBS/Securitized are leading at 3+%.
HY Munis a great month with many funds on the list at 3-4%
Inter term – did well. Most on the list at 1-1.5%.
Uncontrain/Nontrad-most with 1-1.5%.
HY+EM – HY didn’t do much but EM did nicely.
Corp – 1.9% is pretty good.
SP500-made 2% PCI 1%
===========================
My own portfolio
I started the month with GWMEX, smaller position in TSIIX and much smaller in EIXIX and…drumroll..I finished with the same funds.
Summer is here, stocks + bonds did very well in the last 3 months, I don’t want to add more risk but I see several funds that interest me for potentially better performance without elevating SD which both are not a guarantee.
Disclaimer: The above are just observations, you must do your own due diligence, I can trade any time

The difference between VCIT and some of the funds you are “pumping” is VCIT has recovered its losses and most of your other funds are still down YTD.

Other funds? I don't own any of these funds. I already explained why VCIT recovered so why repeat it but if you look at YTD (chart) of MWFSX,M* multi sector category+SEMMX+VCIT you can see that MWFSX peak to trough was about 6% and better than VCIT. It was also better than a typical Multi sector fund and definitely better than SEMMX. It is up 7.7% YTD.

https://www.google.com/amp/s/www.bloomberg.com/amp/news/articles/2020-06-29/an-mfs-investment-manager-is-fighting-fomo-and-dumping-stocks
https://finance.yahoo.com/news/mfs-investment-manager-fighting-fomo-124622458.html
An MFS Investment Manager Is Fighting FOMO and Dumping Stocks
Manager at $500 billion firm resists chasing historic rally
This recession is worse than previous downturns: Almeida
Wall Street is counting on FOMO, or fear of missing out, to power the next leg of this fierce stock rally. But some, like Rob Almeida, refuse to be drawn in.