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150 pages of reports (a page per family), plus various rankings of families (inflows, largest number of medalist winners, largest percentage of AUM in 4 and 5 star funds). Methodology description.Twice a year, Morningstar publishes the Fund Family 150 report, an update on the 150 largest U.S. fund families. Of the 777 fund families in the U.S., these fund families account for 99% of the $19.3 trillion invested in U.S. funds and ETFs.
Whoops. At least Merriman's column is labeled "Opinion".Despite the notable cost advantage, each Freedom Index fund lagged its Freedom series counterpart since the Freedom Index series' late-2009 launch through December 2018; the funds underperformed by 15-73 basis points annualized. The absence of active management and certain subasset classes, like high-yield bonds, from Freedom Index contributed to these re-
sults.
https://www.barrons.com/articles/fidelitys-latest-gambit-for-your-retirement-savings-1536247498Actively managed funds will comprise a bigger slice of the pie in areas where the markets are less efficient and active managers can add more value, says Andrew Dierdorf, co-manager of the Freedom Funds. That will primarily be in small-caps, high-yield bonds, floating-rate loans, and emerging markets. The funds’ underlying exposure to large-cap equities and government fixed income will be more index-oriented, he says.
#1 pretty much sums it up and very close to what I wrote in my book. Half my profits in 98 and 99 came from the new fund effect in tech and small cap growth because of allotments to hot IPOs. I can think of a few new funds from Janus and INVESCO that were up 15% to 25% in a month. Even used Strong’s new high yield fund to my advantage in 96 where it beat not only all its peers but the S&P. I also exploited datelining - probably the closest thing to a free lunch you could ever find on Wall Street. I make no bones about luck being on my side in the 90s. Funny thing about luck as I have also been lucky since 2000 too, especially the luckiest trade of my lifetime - junk bonds on 12/16/2008 when the Fed rang the loudest bell I have ever heard on Wall Street. Probably explains why The Luck Factor by Max Gunther is one of top three favorite books.@junkster I was writing about funds back when those studies on new funds came out and a few things come to mind:
1. In the 1990s many new small cap and growth funds were launched that benefitted from extra IPO allocation to hot dot.com stocks like Pets.com and
Webvan. Van Wagoner , Turner Microcap Growth, Strong and Janus funds come to mind. Some of them ultimately got in trouble for juicing their new fund returns with more shares of these IPOs than other funds at the shop and not acknowledging that it was IPOs doing the heavy lifting and that once the funds grew in size the IPO effect wouldn’t last. In fact, many of those IPOs subsequently flamed out. In any case, times have changed and we no longer have a 1990s IPO market for new funds to benefit from.
2. I am fairly certain those Kobren and Charles Schwab studies did not adjust for survivorship bias. I would have to check but I did write about them back then—favorably too I believe—and I recall no mention of survivor bias. Please provide any evidence of the new fund effect that adjusts for survivor bias today if you have it. I doubt there is any evidence for it as I see bad new funds liquidated every day. In fact, their liquidations are tracked here. Nor is this to say I am against new funds. But I think newness must be accompanied with additional quantitative and qualitative research, the kind David does on this site. Fees should be part of that research in my view, and there is far more evidence of fees importance to performance than the new fund effect.
3. Think of the kind of fund this is and what it’s investing in—non-agency debt. That debt has in the past become extraordinarily illiquid during times of market stress. And funds that invested in it have been crushed due to illiquidity. I suggest MFOers look up the Regions Morgan Keegan funds if they doubt the risks of a liquidity crunch. Such a sector is not the best fit for a mutual fund that must provide daily liquidity in my view especially if the fund concentrates in that sector to a high degree over more liquid mortgage bonds. The sector meanwhile is shrinking each year.
4. At $2 billion in assets this fund collects $30 million in fees a year. At $3 billion it collects $45 million. The team required to investigate this one sector of the market must be highly compensated with that fee. Are they earning it with good Individual security selection or by concentrating in the riskiest sectors of the mortgage market more so than their lower cost peers. Regions Morgan Keegan once had a great record too before the housing bust by taking such risks.
5. In a highly illiquid sector money managers often use a pricing system called fair value for estimating securities value in the portfolio. That can make the fund seem a lot more stable than it actually is and hides risk. It also creates an incentive for fraud in how securities prices are marked.
Thanks @Old_Joe ...... :)Extensive research shows that 99.6% of the time this topic is discussed on MFO a major recession starts within 36 hours.
https://www.irs.gov/publications/p590a#en_US_2018_publink100024687Application of one-rollover-per-year limitation. You can make only one rollover from an IRA to another (or the same) IRA in any 1-year period regardless of the number of IRAs you own. The limit will apply by aggregating all of an individual's IRAs, including SEP and SIMPLE IRAs as well as traditional and Roth IRAs, effectively treating them as one IRA for purposes of the limit. However, trustee-to-trustee transfers between IRAs aren’t limited and rollovers from traditional IRAs to Roth IRAs (conversions) aren’t limited.
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