O’Shaughnessy was best of Friday's session. An industry stand out. His presentation was about the inherent conflicted nature of delivering alpha and accumulating assets. Basically. the more AUM, the more holdings a portfolio must maintain, the more it then looks like an index, the less likely its performance will deviate from the index. "Scale eats returns." He sees active share as a measure of the potential to be better (or worse) than index. "Dare to be great." He thinks both Wes Gray and Meb Faber are offering ETFs closest to the strategies he recommends. That said, he admits there are only a few money managers he would trust with his money. (He would not say which ones.)
Met with Rich Powers, Vanguard's head of EtF product management. Vanguard offers 70 ETFs with AUM totalling $565B. As a whole, the US EtF industry offers some 1800 ETFs with about $2.4T AUM. So, with just 4% of products, Vanguard has captured one quarter of the AUM. Can you believe that? Our fund family data on the MFO Premium site shows that 60 of their 70 ETFs have beaten their peers since inception. That's simply amazing. Rich had a quick response: "The power of low fees." Vanguard is the only company to offer some ETFs as simply another share class of its open-ended sibling. "Economies of scale," Rich explained.

Here's a set of slides from a recent "Jeffinar" presentation:
businessinsider.com/jeff-gundlach-full-presentation-september-2016-election-economy-gold-2016-9?op=1/#-1

FYI: Don’t blame DoubleLine’s Jeff Gundlach for causing the stock market to tumble the most since the aftermath of the U.K.’s decision to break from the European Union roiled global markets in late June.
Regards,
Ted
http://www.marketwatch.com/story/how-gundlachs-fed-tightening-talk-set-stage-for-a-stock-bond-market-meltdown-2016-09-09/print

I had initially bought into the hype surrounding the total return fund DLTNX, but have since sold it and added to GIBIX. Before 2016 I didn't have any bond funds, as I held individual muni bonds, but half of them were called (had a total of 4) and needed to find bond funds that I could use for income and to funnel profits to on my equity portion of portfolio. With over 80% in mortgage related bonds, DLTNX seemed a bit too aggressive, despite Mr Gundlach's record. I am sticking with GIBIX, PFBPX, PYACX and STRYX plus CPXIX for some preferred stock income. My equity allocation of 65% has some fairly aggressive components along with some more moderate positions, figured my bond portion needed to be more conservative. Honest best wishes for other MFO members who have a bit more faith in Gundlach and his team. Please Lord, let him be wrong about Trump.

Apologies if I didn't catch this in TSP's posts, but JG said pointedly that rate risk is a place to dial back; the rate bottom's in, he says, with the failure to breach the earlier T lows. Also:
- Reiterated that 2% on the 10yT may be a buy, but probably not for the long term.
- The place to take credit risk now is in non-agency mortgages.
- DBLTX is about as defensively positioned as it's ever been against rate risk - duration of ~ 2, distribution yield of 3.7%.

Chock full day.
More than 650 total attendees at the conference, including more than 500 registered attendees (mostly advisors), more than 80 sponsor attendees, nearly 40 speakers, and more than 30 members of the press. Up somewhat from last year.
Morningstar will soon start giving forward looking "aptitude" medal ratings to exchange traded funds. Will use same 5 Ps methodology as open ended funds. About 300 will be rated along with open ended funds in same category. EtF AUM now at $2.4T. While no plans yet to merge conferences, I believe it is inevitable for June and September Morningstar Chicago conferences to merge.
Lots of discussion of value and momentum strategies today. Fama calls the latter the premier anomaly in investing. AQR's Ronen Israel discussed facts and fiction. Despite that everybody knows benefits of each strategy, AQR believes it is fact that premia in each exist will continue.
One of Morningstar's brigthest, Alex Bryan, moderated a session on largely same topic by Gary Antonacci, Meb Faber, and Wes Gray. All disciples. Wes, probably the hardest core "believer" in pure value. But, data backs-up momentum as well. Why do these strategies persist? Because they are so utterly painful to stick with. Gary, however, uses an "absolute momentum" overlay (based on 12 month SP500 total return vs risk free) to mitigate drawdown, which he argues is more steady than simple moving average methods.
Met with John Ameriks, head of Vanguard's Quantitative Equity Group. He believes that a big reason "quants are winning" is that they provide a rules-based methodologies so investors better know what to expect. Unlike, say, the sometimes surprising behavior of active investors, like Fairholme's Bruce Berkowitz. John's group has 25 analysts and has been in existence for 25 years. At $30B in AUM, lots of responsibility here.
In a panel on "best ideas," Rich Bernstein, John West of Research Affiliates and Mark Yusko of Morgan Creek Capital Management seemed mostly conflicted. Bernstein believes cyclical equities and perhaps equities as a whole, will continue their bullish run. Expects excess returns the next two years for industrial's. But, the catastrophe will be bonds. Yusko, the most vocal, believes US stocks will crash in next year or so. Doomed based on valuations and demographics. He thinks that the only thing investors do well is invest in the last thing that worked. So, investing in index funds going forward will be catastrophic. While he dropped names like Seth Klarman of Baupost, Yusko's positions seemed to me ... hmm, what's a good word ... malarkey. West was most tempered of the trio, touting Research Affiliates benefits of all asset diversification, which always takes the 10 year view.
Took several other interviews, including a couple EtF managers that focus on EM consumers and Millennial consumers. Can you believe that? The PM at Iowa's Prinicpal, named Paul Kim, formally at PIMCO, seemed pretty impressive to me. More to come.
Looking forward to morning talk by Patrick O’Shaughnessy, entitled Alpha or Assets. As well as interview with Vanguard's Head of Equity EtFs and walking the exhibitor booths.
c

@MikeM said
I put a good portion of my self managed portfolio into DSENX (15%) after reading about the funds objectives and style,
@gmarceau said
Shiller's indexes almost seem like a free lunch at this point
@davidrmoran said
.." I have so much money in a fund"..
Mr Gundlach referred to investors like you guys as "sophisticated" in recognizing a smarter beta product that has delivered the return it was designed to do.He again encouraged equity investors to consider the fund. DSENX
After a mostly entertaining hour and 15 minutes he finished with "enjoy the N F L season and Go Bills ! "
@hank said
Glad I didn't follow my own advice, as I'm sitting on a double-digit return year to date. Cash wouldn't have done it. Still…
Mr Gundlach said "don't get cute and try to get every last bit of juice from the orange ".
Get more defensive with less risky assets and cash
@davidrmoran said
jeeeeeeezus, how can I have so much money in a fund where the co-manager thinks DT is going to win the election? Politics aside, what does that say about his intellect and thought processes and observational and analytical skills ?
Mr Gundlach very briefly reiterated his belief that Donald Trump is going to win.
Mr Gundlach said he has no plans to open a Long /Short bond fund and doesn't believe a fund of that nature has a place in one's portfolio because of the interest costs involved in holding the short positions.And here I bought a fund ,CRUPX, of that nature to help mitigate my perceived risks .
Mr Gundlach said that the untimely death of his colleague, Bonnie Baha, had saddened the entire firm but her spirit and legacy would be reflected in the 21 person team she had personally built from an original 4 .He sees the firm as intact in Ms Baha's vision and mission.
A note from one of Bonnie Baha's obits
.Bonnie Baha, a U.S. bond portfolio manager who helped Jeffrey Gundlach turn DoubleLine Capital into a $100 billion asset management firm, has died. She was 56.
“People don’t pay me to hope; they pay me to make an assessment,” Baha said of the trading call. “If you are managing risk by hoping that somebody is going to buy Lehman Brothers or whatever other bank is in trouble, you’re not really doing your job.”
http://www.bloomberg.com/news/articles/2016-08-22/bonnie-baha-doubleline-s-head-of-developed-credit-dies-at-56

Here is a link to the presentation...
http://www.businessinsider.com/jeff-gundlach-full-presentation-september-2016-election-economy-gold-2016-9/#-39

Short Press Release from Wasatch
Wasatch International Opportunities Fund to Close to New Investors on September 29, 2016
(September 08, 2016)
Salt Lake City, Utah, September 8, 2016—Effective at the end of market trading (4:00 p.m. EST) on September 29, 2016, the Wasatch International Opportunities Fund (WAIOX/WIIOX) will be closed to new purchases, except purchases by new shareholders purchasing directly from Wasatch Funds, existing shareholders, and current and future clients purchasing through financial advisors and retirement plans with an established position in the Fund.
“Wasatch takes fund capacity seriously and, given the international micro-cap focus of the International Opportunities Fund, we believe that this step will protect the integrity of our investment process,” said Gene Podsiadlo, Director of Mutual Funds.
Contact Information:
Jody Lowe: 414.322.9311 / [email protected]
Steve Rung: 801.415.5523 / [email protected]
https://secure.wasatchfunds.com/News/Article.aspx?a=WAIOX Close 2016
Total Assets:
(All Classes) $654.0 (million) as of 09/08/16
https://secure.wasatchfunds.com/Our-Funds/Overview.aspx?fund=WAIOX

https://www.sec.gov/Archives/edgar/data/806633/000119312516704743/d254531d497.htm
497 1 d254531d497.htm WASATCH FUNDS TRUST
WASATCH FUNDS TRUST
Supplement dated September 8, 2016 to the
Prospectus dated January 31, 2016 and
Statement of Additional Information dated January 31, 2016, as amended and restated on July 8, 2016
Investor Class
Wasatch Core Growth Fund® - Investor Class (WGROX)
Wasatch Emerging India Fund® - Investor Class (WAINX)
Wasatch Emerging Markets Select Fund® - Investor Class (WAESX)
Wasatch Emerging Markets Small Cap Fund® - Investor Class (WAEMX)
Wasatch Frontier Emerging Small Countries Fund® - Investor Class (WAFMX)
Wasatch Global Opportunities Fund® - Investor Class (WAGOX)
Wasatch International Growth Fund® - Investor Class (WAIGX)
Wasatch International Opportunities Fund® - Investor Class (WAIOX)
Wasatch Large Cap Value Fund® - Investor Class (FMIEX)
Wasatch Long/Short Fund® - Investor Class (FMLSX)
Wasatch Micro Cap Fund® - Investor Class (WMICX)
Wasatch Micro Cap Value Fund® - Investor Class (WAMVX)
Wasatch Small Cap Growth Fund® - Investor Class (WAAEX)
Wasatch Small Cap Value Fund® - Investor Class (WMCVX)
Wasatch Strategic Income Fund® - Investor Class (WASIX)
Wasatch Ultra Growth Fund® - Investor Class (WAMCX)
Wasatch World Innovators Fund® - Investor Class (WAGTX)
Wasatch–1st Source Income Fund® - Investor Class (FMEQX)
Wasatch-Hoisington U.S. Treasury Fund® - Investor Class (WHOSX)
This Supplement updates certain information contained in the Wasatch Funds Prospectus dated January 31, 2016 and Statement of Additional Information dated January 31, 2016, as amended and restated on July 8, 2016 for Investor Class shares. You should retain this Supplement, the Prospectus and Statement of Additional Information for future reference. Additional copies of the Prospectus and Statement of Additional Information may be obtained free of charge by visiting our web site at www.WasatchFunds.com or calling us at 800.551.1700.
Effective at the close of market on September 29, 2016, the Wasatch International Opportunities Fund (WAIOX) will be closed to new purchases, except purchases by new shareholders purchasing directly from Wasatch Funds, existing shareholders, and current and future clients purchasing through financial advisors and retirement plans with an established position in the Fund.
As described in more detail in the Statement of Additional Information, the Advisor retains the right to make exceptions to any action taken to close a Fund or limit inflows into a Fund.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE
_________________________________________________________________________________________________________________________
WASATCH FUNDS TRUST
Supplement dated September 8, 2016 to the
Prospectus dated January 31, 2016 and
Statement of Additional Information dated January 31, 2016, as amended and restated on July 8, 2016
Institutional Class
Wasatch Core Growth Fund® - Institutional Class (WIGRX)
Wasatch Emerging India Fund ® - Institutional Class (WIINX)
Wasatch Emerging Markets Select Fund® - Institutional Class (WIESX)
Wasatch Emerging Markets Small Cap Fund® - Institutional Class (WIEMX)
Wasatch Frontier Emerging Small Countries Fund® - Institutional Class (WIFMX)
Wasatch Global Opportunities Fund® - Institutional Class (WIGOX)
Wasatch International Growth Fund® - Institutional Class (WIIGX)
Wasatch International Opportunities Fund® - Institutional Class (WIIOX)
Wasatch Large Cap Value Fund® - Institutional Class (WILCX)
Wasatch Long/Short Fund® - Institutional Class (WILSX)
Wasatch Small Cap Growth Fund® - Institutional Class (WIAEX)
Wasatch Small Cap Value Fund® - Institutional Class (WICVX)
Wasatch World Innovators Fund® - Institutional Class (WIGTX)
This Supplement updates certain information contained in the Wasatch Funds Prospectus dated January 31, 2016 and Statement of Additional Information dated January 31, 2016, as amended and restated on July 8, 2016 for Institutional Class shares. You should retain this Supplement, the Prospectus and Statement of Additional Information for future reference. Additional copies of the Prospectus and Statement of Additional Information may be obtained free of charge by visiting our web site at www.WasatchFunds.com or calling us at 800.551.1700.
Effective at the close of market on September 29, 2016, the Wasatch International Opportunities Fund (WIIOX) will be closed to new purchases, except purchases by new shareholders purchasing directly from Wasatch Funds, existing shareholders, and current and future clients purchasing through financial advisors and retirement plans with an established position in the Fund.
As described in more detail in the Statement of Additional Information, the Advisor retains the right to make exceptions to any action taken to close a Fund or limit inflows into a Fund.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE

Shiller's strategies seem to be working well and I'm actually surprised because most of these new funds by the quant/trend followers/13F filings/s&p under it's 200 day moving average guys seem to be under performing more than I expected. Shiller's indexes almost seem like a free lunch at this point.
QVAL, QMOM, GVAL, etc have just been tanking over the last two years, but then I'm reading articles from these guys that momentum and value strategies can under perform for up to 10 years, sometimes longer!?!?! And ALFA just got slaughtered when it went market neutral. If it's always best to buy when a fund's outlook seems darkest, then I'm loading up on MUHLX.

FYI: A survey finds that the youngest—and biggest—generation of investors is the most enamored of exchange-traded funds.
Regards,
Ted
http://www.wsj.com/articles/millennials-show-more-love-for-etfs-and-vice-versa-than-their-parents-do-1473127503

Please join us for a live webcast titled "Turning Points" hosted by:
Jeffrey Gundlach
Mr. Gundlach will be discussing the economy, the markets and his outlook for what he believes may be the best investment strategies and sector allocations for the DoubleLine Total Return Bond Fund (DBLTX/DLTNX).
Jeffrey Gundlach Total Return Webcast
Scheduled for: Thu, Sep 8, 2016 1:15 PM PDT 4:15 PM EDT 3:15 PM CDT
https://event.webcasts.com/starthere.jsp?ei=1085768
@hank said
Glad I didn't follow my own advice, as I'm sitting on a double-digit return year to date. Cash wouldn't have done it. Still…
The "lower for longer" narrative is coming back into favor after the ISM services index unexpectedly tumbled to a five-year low in August. We can add that disappointment to last week's move into contraction zone for ISM manufacturing, as well as Friday's nonfarm payrolls miss.
http://seekingalpha.com/news/3207108-string-sluggish-data-boosts-gold
T.I.N.A
When weighing whether to stay in the market after the long run-up in stocks or bail for an alternative investment, people are following Tina's lead at the dance.
In investing shorthand, Tina stands for "there is no alternative."
Are you dancing in the market with Tina?
By Stephen Pounds · Bankrate.com
Read more: http://www.bankrate.com/financing/investing/are-you-dancing-in-the-market-with-tina/#ixzz4Jc9LziJ0
Follow us: @Bankrate on Twitter | Bankrate on Facebook

And Goldilocks continues to dream sweetly !
DEFINITION of 'Goldilocks Economy'
An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. There are no exact markers of a Goldilocks economy, but it is characterized by a low unemployment rate, increasing asset prices (stocks, real estate, etc.), low interest rates, brisk but steady GDP growth and low inflation.
http://www.investopedia.com/terms/g/goldilockseconomy.asp

GLOBAL MARKETS-Stocks edge up, yields dip on muted Fed hike expectations
By Chuck Mikolajczak Reuters September 7, 2016
NEW YORK, Sept 7 (Reuters) - A gauge of global equity markets reached its highest level in over a year on Wednesday and U.S. Treasury yields declined for a second straight session as expectations for a interest rate hike by the Federal Reserve remained muted.The probability for a September rate hike inched up to 18 percent after the comments, from 15 percent in the prior session, according to CME's FedWatch tool, while expectations for a December increase nudged back above 50 percent.
http://finance.yahoo.com/news/global-markets-stocks-edge-yields-203007331.html
@hank said Just read the Stephanie Pompoy
Is she a perpetual bear or what? The sky is falling.
What if Ms Yellen does raise rates @ Sept meeting ?

Over the 3 years through Jul 2016, JNVSX could have been substituted by a fixed portfolio of ETFs (~22% FXR, 19% TDIV, 17% SPHQ, 11% XRT, 9% IHF, 8% VIG, and a couple of smaller positions) that had a ~4.4% higher cumulative return at a comparable volatility. See goo.gl/2Z3V5Q

See a detailed analysis of CCASX at goo.gl/ekul1w

Another way to substitute DFSVX, published a year earlier than this article -- see goo.gl/7RzdsC
For the 5 years through Aug 2016, DFSVX could also have been substituted by a fixed portfolio of ETFs (~41% IWN, 14% RZV, 10% PSCT, 9% XRT, 8% PRN, 8% KBE, 6% PXI, and a couple smaller positions) with a similar cumulative return and lower standard deviation.

Since Aug 2015, FISMX could have been substituted by a fixed portfolio of ETFs (~20% DFE, 19% SCHC, 17% PGF, 10% WPS, 6% FM, 6% DFJ, 5% BRF, and several smaller positions) that had a ~1% higher cumulative return at a comparable volatility. See goo.gl/2Z3V5Q

@MFO Members: INDEX Fund Fact Sheet:
Regards,
Ted
http://index.world/wp-content/uploads/2015/04/Index-Funds-SP500-Equal-Weight-No-Load-Fact-Sheet-063016.pdf
M* Snapshot INDEX:
http://www.morningstar.com/funds/xnas/index/quote.html

This month's commentary identifies INDEX as the entry into S&P 500 Equal Weight mutual fund. I have been interested in this area for some time but looking for an option less expensive than the INVESCO mutual fund or Guggenheim EFT. INDEX OER is .30 which is less than its competitors, however, it charges a $25.00 annual maintenance fee for small accounts (defined as less than $25,000) and the board of director (trustees) have zero dollars invested in the fund. INDEX website shows approx. $3 [million] total assets [Morningstar reports $4 million in the fund, David.]; the founder of the fund has 10k-50k invested. Just sharing information.

Interestingly, Vanguard Total Bond Market Index, BND, was not included in the article. This ETF has $162B in asset.