Nice article. I was somewhat familiar with the Undiscovered Managers fund UBVAX, but had never heard of FTHNX. Thanks for the pointer.
I find that it's not hard on occasion to spot a stock that has been unfairly beaten down on some news. But should I buy, I wouldn't have a clue when to get out, so I leave trading to fund managers. The FTHNX prospectus says it buys securities when investors overreact to bad news or underreact to good news, and it sells when the opposite occurs, which I guess is either investors overreacting to good news or underreacting to bad news.
Identifying overreaction to bad news IMHO isn't that hard if one is familiar with the industry involved and has a good sense of long term prospects. An industry may be sound, but someone says the sky is falling. (Think of the muni bond market after Meridith Whitney's 2010 prediction of 50-100 defaults.)
But how do you know that good news is good, but not quite as good as people think? That's more subtle. Or that bad news is actually worse than people think. Kudos to managers who can do this well. Not to mention doing it frequently. The individual investor need only react when he spots something, as opposed to having a day job of actively seeking these over/under reactions.
I agree with the quote in the article: "But over long periods of time, it’s difficult to say markets under- or overreact." That would seem to call for higher turnover. Individual security behavioral anomalies don't persist (though as I said, I've no clue when they're ended, i.e. when to exit). Which makes me wonder how some of these funds can operate with such low turnover, e.g. LSVEX (15% turnover).
Regarding the nuts and bolts of FTHNX - the prospectus ER of the fund is 1.07%, the 0.89% is what's reported in the latest annual report. The difference appears due to an a service fee of 0.20% that the fund is allowed to charge (prospectus) in order to pay brokerages for servicing the shareholders. That fee is not currently being charged.
Regardless, these number incorporate a fee waiver of about 2%, which is scheduled to be reduced by 0.20% next February. That is, you should count on the ER rising by 0.2% in 10 months. Still not too expensive for a small cap fund.
Also, while the fund is NTF at Schwab (and elsewhere), it is TF at Fidelity.

@The Pudd
WSBFX and BTBFX is practically the "Same" fund. One of them claims to be "socially responsible" version of the other.
VWELX I already got, not sure I need VWINX
Looking for go anywhere managers with BVAOX and not looking for small cap fund, so not sure DISSX compares.
BULLX, again is go anywhere and capital preservation is a mandate. PARWX is from Parnassus, the company that holds Wells Fargo. Pass.
GTSOX is expensive? 0.85% ER. Please do tell alternative option.

Hi Guys,
The referenced article by Lewis Braham is very nice. It is well researched and deals with protecting a portfolio against bad investment decisions. Financial gurus often remark that the best long term investor returns come not from making good decisions, but from avoiding bad investment decisions.
I was able to initially access the Link that Ted provided, but I am currently experiencing difficulties as I try to more carefully read the article. As a substitute, here is a Link to another article that places the same emphasis on not losing decisions rather than winning investment decisions:
https://www.cfainstitute.org/learning/investor/documents/twenty_common_mistakes.pdf
Unlike most of these types of how-not-to articles, it more than doubles the recommendations by advocating 20 corrective rules.
Here's yet another Link that discusses the issues from a slightly different perspective:
http://economictimes.indiatimes.com/wealth/personal-finance-news/globally-investors-make-the-same-human-mistakes-carl-richards-certified-financial-planner/articleshow/57093397.cms
The investment mistakes that are commonly made are similar in a worldwide context.
If you have the endurance, here is one more thoughtful reference that lists investment mistakes:
http://www.bloomsburywealth.co.uk/mistakes-investors-make/
In this instance, the behavioral missteps are distilled down to 5 dominating factors. All these articles focus on mistakes which have the greatest potential impact on end wealth. Although each differ somewhat, they all are fairly similar in their individual assessments of investor's major shortcomings. We're all somewhat imperfect in our decision making, and allow emotional aspects into our investment decision process. That does harm. No great surprise!
Best Wishes

Matt, PYMDX/PHMIX and MMHAX are the two I normally have money in, going in and out, partially, in steps, based on T rate trajectory and trading ranges. They're both up 4%+ ytd.
Fyi, MMD is a top-performing muni cef run by the same managers as MMHAX. Bob DiMella, one of the management team (and I think the lead, though he's not id'd as such by M*), has been on WealthTrack in the past, the last time maybe a year or two ago - you could get the flavor from that interview if you want to search for it.
Found my way to HY munis about two years ago, and until the markets change, I'm done with ~ all investment-grade muni oef's. Cef's (which the article emphasizes) are a different animal; I usually own one or two, but opting for the oef's right now.
Like the article says, HY muni funds aren't nearly as junky or default-risky as corporate HY; the default rates on the former are much lower, and the muni funds typically have higher average quality than corporates. For example, Pimco and Mainstay are about 60% and 50% investment grade, respectively.
Best -- AJ

Some people should not be seen again. Miller is one of them.
Contrarian...Value...and of course for the last 5 period of this extreme bull market his fund is tops again. Who knew!
And if you had ANY doubt...this is from Morningstar fund front page snippet for "Analyst Commentary". This is NOT a typo.
Legg Mason Opportunity Trust has outperformed at times, but its volatile nature leaves it vulnerable to substantial losses in down markets. This fund earns a Morningstar Analyst Rating...
They didn't even bother to be objective. They just knew they HAD to cover it. And let's start with a Neutral rating before we fall all over ourselves.
And Consuelo, "in his rare interview"...that's because YOU are responsible. Else there would be NO interview.
People who invest with Miller deserve it.

Has been a bit of a stealth bull as this sector is beating all the taxable bond sectors YTD except emerging markets and preferred. In my 5 bond portfolio had swapped out of FCFAX into PYMDX. Unfortunately not a huge position yet. @SlowLane was two steps ahead of me here and in the best performing Oppenheimer high yield munis, not available to me at Scottrade.

@Crash: For your information. Founded in 1985 by Alfred “Al” Lagan, Congress Asset Management Company is a boutique, SEC registered, family-owned, investment management firm based in Boston, MA. The firm was built with the strong conviction that the client’s needs come first. Under the guiding principle of “Growth at Reasonable Risk,” the firm began by providing tailored risk-adjusted investment solutions to Taft-Hartley pension plans and insurance companies.
Congress grew under the leadership of Al’s sons, Dan and Chris, who apply the same model to a larger array of client-types. The firm serves endowments, foundations, high net worth individuals, 401k plans, and advisory platforms through a diversified suite of investment products and services.
Regards,
Ted
Congress Asset Management Other Funds:
http://www.congressasset.com/funds/mf_download_menu.htm

I finally DID, after mulling it over, empty-out my TRP RE fund, TRREX (all of which came from TRGRX Global RE, at the New Year,) and I plunked it into my PRIDX. US valuations are rich, and RE is not the place to be right now; also, in a recent conversation here, it was observed that as long as my fund managers have RE covered, then I don't really need a dedicated RE fund, in addition. So, I pulled the trigger. And so PRIDX doubled in size, in my portfolio, to 6.51% of total.

A lot of nonsense from the hagiographic contingent.
Charlie Munger makes a pretty good case for the talent wasted by the suck of engineers and scientists to Wall Street when he laments over all the useful and enduring stuff they could actually do with their talents, rather than writing algorithms that skim fractions of pennies of dollars (or fractions of seconds off a trade) with no tangible benefit to society at large (I'm waiting for the "liquidity" defense, I wonder who will oblige?). I work with a Ph.D. scientist who left a Wall Street quant shop -- the money is reportedly wonderful while it lasts, the work itself is not so interesting.
Michael Lewis has written extensively since Liars Poker on the anti-social (perhaps better, sociopathic) nature of Wall Street. The book itself is like an onion, the more you peel the pages, the more you cry. Lewis would laugh at the idea of so many noble contributions to the common good. I think one could draw the same conclusion from his most recent books.
And then there is the matter of bonuses and compensation packages. Wall Street is not alone here, but its a good a place to start as any. All one need to do is apply a little common sense -- you don't even have to look as high as the 75th percentile of some of these salary ranges to start asking yourself if society writ large is truly well served by such concentrations of reward. In a previous life, I did a stint at a firm that designed executive compensation programs. Heady stuff: "the market" always flailing to catch up with "the market" in a dizzying cycle reaching higher and higher into the sky like Jack's magic bean stock, with no real justifications or sanity check of any kind. Every exec wants to peg his/her salary to someone the next tier up in the industry, the next higher quantile, etc. Some of the conversations one hears in such venues are ridiculous.
Does Wall Street perform useful and necessary functions? Yes of course. Should that give Wall Street a pass on excesses, and privatizing reward while being ever-ready to socialize failure? I'm surprised there really even needs to be a conversation on this after 2008.

FYI: J.D. Power once again set out to answer that question with its annual “U.S. Full Service Investor Satisfaction Study.” Financial firms were ranked based on a January 2017 survey of 6,500 investors who work with financial advisers for at least some of their investments. The firms were measured on a 1,000-point scale based on how they fared in categories including financial advisers, investment performance, account information, product offerings, commissions and fees, websites and problem resolution.
Regards,
Ted
http://www.jdpower.com/press-releases/jd-power-2017-us-full-service-investor-satisfaction-study

"I'm looking at the 5-year tax adjusted returns for RPHYX and it's 1.40%. Three years is 0.90%. "
Okay, but what are you saying? That this is better than cash, or that it's worse than more volatile funds?

I wasn't saying anything other than what was stated - the numbers provided by *M. People can make their own conclusions based on the numbers. Taxes may play a part in returns so I think it's important to keep that in mind, especially for those holding these types of funds in taxable accounts.

I checked with my favorite site for total return ...
I also checked performance at M*, with their closest return indicator at 5 years and the total return numbers since inception are a match within .02%.
I fired up my handy-dandy HP-12C and did rough numbers.
RPHYX is 6.38 years old and has a total return of 17.75% in this time frame. The math indicates an annualized return of 2.78 (M* reads 2.76% at the 5 year return), before any taxes if held in such an account.

M* has all the data, you just have to know how to coax it out. If you go to the chart page, you'll get a chart for the lifetime of the fund. $10K grew to $12,137.31, for a total return of 21.3731%. (You can also see this on the summary page chart.)
http://quotes.morningstar.com/chart/fund/chart?t=RPHYX&region=usa&culture=en-US
The Stockchart link you gave appears to go back only to March 24, 2011 (just over 6.0 years). The fund started Sept. 30, 2010 (just over 6.5 years). Not sure where 6 3/8 years came from.
The M* chart can be adjusted for any dates. If I adjust it to begin on March 24, 2011, I get a total return of 19.17%. I don't yet have an explanation for the discrepancy.

"I'm looking at the 5-year tax adjusted returns for RPHYX and it's 1.40%. Three years is 0.90%. "
Okay, but what are you saying? That this is better than cash, or that it's worse than more volatile funds?
If someone was in the top marginal tax bracket (that's how M* computes tax-adjusted returns), then they probably owned RPHIX that gave an extra 1/6% or so in return (after taxes). You can also add another 0.1%/year to the after tax return to account for the capital loss writeoff when cashing out. (Shares were around $10/share until about 3 years ago; they're now around $9.75.)
So over five years, the after tax return looks closer to 1.65%. Not bad compared to a five year CD (offered five years ago). Even before taking out the 30+% (top rate) taxes on that CD.
http://www.bankrate.com/banking/cds/historical-cd-interest-rates-1984-2016/
The after-tax return also looks good compared to short-intermediate muni funds like BTMIX, VMLUX, or FSTFX. (I'm inclined to look in this duration range for muni funds; anything shorter doesn't seem to pay enough to beat cash, and anything longer seems to have too much interest rate risk.)

I don't have any money with this horse and will not; but was curious. I checked with my favorite site for total return, and the graphic is at the below link.
I also checked performance at M*, with their closest return indicator at 5 years and the total return numbers since inception are very close.
I fired up my handy-dandy HP-12C and did rough numbers.
RPHYX data is for a time period of 6 years; and has a total return of 17.75% in this time frame. The rough math indicates an annualized return of 2.89 (M* reads 2.76% at the 5 year return), before any taxes, if held in such an account.
Stockcharts by default, uses adjusted calculations for returns. The adjustments are for common items as; dividends, cap. gains, splits and assumes everything reinvested; whatever affects total return. I prefer this method versus the commonly used price/NAV only shown at many charts. I want the whole picture for the investment return. If one wants price only appreciation, an _ is placed in front of the ticker symbol.
The below linked chart is "active", meaning that you may add up to 9 more tickers separated by a comma; if you want to compare something else. Save the page for future use, if you have not. Lastly, Stockcharts will not chart a ticker that has not yet attained an age of 2 years.
One may move the slider bar under the graphic to change the begin and end period if you want to view a particular period.
Pillow time here,being a bit to the tired side ......hoping for no errors in the above; .
http://stockcharts.com/freecharts/perf.php?RPHYX&n=1519&O=111000

I'm looking at the 5-year tax adjusted returns for RPHYX and it's 1.40%. Three years is 0.90%.

"The instititional version is a tad better but not that better."
True. Just the very little bit better that's needed to give the institutional class an extra star. (An artifact of star ratings being discrete; 1.99 stars are not given out, only 1 or 2.)

Since inception it is 3.31 vs. 3.02. So closer to what David was speaking of. I was speaking of the past three and five years. It is not unusual for a new fund to outperform its first year or two with small AUM and this fund is no exception. RPHYX hasn't done 3.5% to 4.5% since 2012. What dragged its 3 and 5 year returns down was 0.86% in 2015 when junk had its worst year since..... I am not trying to start a fight with David. I have said it is great as a sub for cash and retirees. It has been on an up trajectory with about as least volatility as you can find.

I'm confused as to how it can be both "2.20% over the past 3 years" and "3.5-4.5% every year except 2012". Surely one of these two statements may be in error?

I am going by Morningstar and the retail class RPHYX. The instititional version is a tad better but not that better.
http://www.morningstar.com/funds/XNAS/RPHYX/quote.html

It probably doesn't help much, but if at some time you have a spare $100K lying around (yeah, sure), you can gain entry into the lower cost shares and then let the balance slide down.
I agree with you that the cost is ridiculously high (for my tastes, a smidgeon high even for an equity fund), but I give the management credit for being able to execute a unique strategy that is not cheap to do and IMHO doesn't scale well. Hence the closure and the fairly small AUM, which adds to cost as a percentage of AUM.
Funds typically pay 0.40% to brokerages like Schwab and Fidelity to list NTF. That's where the 0.25% 12b-1 of the retail shares is going. Some people invest directly and so the fund doesn't have to pay an extra 0.40% on their money. With "luck", their 12b-1 fees added to those of investors who go through brokerages might be enough to cover the 0.40%. If not, the management company pays the difference out of pocket, so it keeps its cut high enought to cover that plus a decent profit.
So when one complains that fund X isn't available NTF, remember that this fact is saving you money in the long term.
The fund is required to charge all investors the same fee for the same share class regardless of channel (direct or brokerage). This is part of the appeal of "clean" shares. The fund charges a bare bones fee (just management and a little overhead), and it's up to the distributor or broker to add its costs in. You'll get to pay for the services you get, through the channel you use, regardless of how other people buy their shares.

This fund is intriguing and unusual. But isn't the expense ratio awfully high? I'd like to know the opinions of those who post here. This morning I asked the same question of River Park at the 212 phone number. He explained that they were small, that some of the er $ went to the sub advisor, and that a lot went to brokerages like Schwab etc. But that left me wondering: since the fund opening is only if dealing directly with the fund, why should an investor pay the fees to a brokerage that is not being used or even available for use? (I know I know. it wouldn't be fair to those who are already share holders if the er was lowered for new investors)
By the way I telephoned the fund at the 888 number to see if both classes of shares were now open. The feller at the other end seemed unaware that this fund had re-opened. He asked some others in the office and confirmed that both classes were open but that the Institutional share minimum was $100,000 whereas the Investor share minimum was $1000. The person I spoke to at the 212 number was aware and very well-informed but he said the Investor share minimum was $2500. Practically speaking the discrepancy is not important since if I decide to put some $ in this fund it would be more than $2500. But $100,000? 'fraid I don't have that kind of cash just lying around.
Any and all thoughts welcome. Thanks!
-Ben