I am using USFR (floating-rate Treasury Note ETF). These FRNs pay 3m yield (reset weekly, so little duration) PLUS a spread MINUS the ETF ER (15 bps). The FRNs have been attractive since mid-2022 when the Fed started raising rates. Think of FRNs as 3m on weekly roll.

Yahoo historical prices show TYX yield hitting 5.05 earlier, back down in the 4.90s since. The 20y is solidly > 5%, 5.13 as I type.

https://www.sec.gov/Archives/edgar/data/1593547/000139834423018996/fp0085383-1_497.htm
497 1 fp0085383-1_497.htm
THE ADVISORS’ INNER CIRCLE FUND III
(the “Trust”)
Advocate Rising Rate Hedge ETF
(the “Fund”)
Supplement dated October 5, 2023 to the Fund’s Summary Prospectus, Prospectus and
Statement of Additional Information (“SAI”),
each dated January 28, 2023, as supplemented
This supplement provides new and additional information beyond that contained in the Summary Prospectus, Prospectus and SAI, and should be read in conjunction with the Summary Prospectus, Prospectus and SAI.
The Board of Trustees of the Trust, at the recommendation of Advocate Capital Management, LLC (the “Adviser”), the investment adviser of the Fund, has approved a plan of liquidation providing for the liquidation of the Fund’s assets and the distribution of the net proceeds pro rata to the Fund’s shareholders. The Fund will create and redeem creation units through October 24, 2023 (the “Closing Date”), which will also be the last day that the Fund’s shares trade on NYSE Arca, Inc. (the “Exchange”), the Fund’s principal listing exchange. The Fund is expected to cease operations and liquidate on or about October 31, 2023 (the “Liquidation Date”).
In anticipation of the liquidation of the Fund, the Adviser may manage the Fund in a manner intended to facilitate the Fund’s orderly liquidation, such as by holding cash or making investments in other highly liquid assets. As a result, during this time, all or a portion of the Fund may not be invested in a manner consistent with its stated investment strategies, which may prevent the Fund from achieving its investment objective.
Shareholders of the Fund may sell their Fund shares on the Exchange on or before the Closing Date. Customary brokerage charges may apply to such transactions. After the Closing Date, there can be no guarantee that there will be a market for the Fund’s shares. For those Fund shareholders that do not sell their shares on or before the Closing Date, the Fund will distribute to each such shareholder, on or promptly after the Liquidation Date, a liquidating cash distribution equal in value to the shareholder’s interest in the net assets of the Fund as of the Liquidation Date.
The liquidation distribution amount will include any accrued income and capital gains, will be treated as a payment in exchange for shares and will generally be a taxable event for shareholders investing through taxable accounts. You should consult your personal tax advisor concerning your particular tax situation. Shareholders remaining in the Fund on the Liquidation Date will not be charged any transaction fees by the Fund. However, the net asset value of the Fund on the Liquidation Date will reflect costs of liquidating the Fund. Shareholders will receive liquidation proceeds as soon as practicable after the Liquidation Date.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE.
ADV-SK-001-0100

Excellent interview, and I agree with a lot of what he says -- especially with his investing style and comments about utilities. The last question is precisely why I like being along for the ride in PRWCX (and potentially TCAP) because it suggests he still has his priorities right.
"People who know me, just know I’m not wired to rest on my laurels or take it easy. I’m just not wired that way. I think we talked about last time when I was on the podcast, I had won couple of Morningstar Manager of the Year awards, trophies. I gave one away to my APM, Steven Krichbaum, and one is in a bag somewhere down in the basement that I don’t know where it is, honestly. And then, I’ve won 18 or 19 awards from Lipper. I’ve never asked for a plaque. I’ve never received a plaque. I don’t want a plaque. I don’t want reminders of past performance making me soft. That’s really important for me. I want to look forward, not backward. That’s really, really important."
< - >
"The last thing I would say is—and it puts a little pressure on me, honestly—is there are so many people that are counting on me: clients, friends, family, my mother, my colleagues, my colleagues’ families, people I grew up with, advisors, and they’ve kind of become accustomed, they’ve come used to generating incredible returns over time. You do it for 15 to 16 years in a row, they expect you to do it next 15 to 16 years. And I have this horrible fear of letting them down. And I’m going to do everything in my power every day that I’m doing this job to make sure that I never let them down. I think if I underperform, my mom is going to be pissed. So, I got to make sure I keep delivering for my clients and my family. And we’re going to continue to work as hard as we possibly can as a team to continue to do that."

Added a bit this morning to a beaten down precious metals / natural resources CEF. Funds came from an international bond fund and a consumers staples stock that have held up relatively well adimst the recent carnage.
Re: metals / Gold is flirting with $1800 level. I doubt it will stay below $1800 for long. But could be wrong.

GMO released a research note today, arguing in favor of (a) Japan equities and (b) value investing therein. Here's their bottom line:

• Investors have been chronically underweight Japan for the past three decades, and rightly so given Japan’s weaker relative fundamentals and underwhelming commitment to corporate reform through much of the 1990s and 2000s.
• But conditions on the ground have changed meaningfully. Improving fundamentals and governance reforms are increasingly evident to investors speaking directly with companies and policymakers in Japan, as our Usonian Japan Equity team does. EPS growth has been relatively strong in Japan for years, distributions of excess capital have increased, and policymakers continue to push for more competitive and capital-efficient companies.
• Nonetheless, most international equity strategies remain materially underweight Japanese equities. Of 225 actively managed strategies in the eVestment database that list the MSCI EAFE index as their preferred benchmark, 84% are underweight Japan by an average of 7.5%. (GMO, "Japan Equities Are Compelling…" 10/4/2023)

GMO runs a couple Japan-value strategies.
Japan is rockin' this year. The New York Times agrees that changes in corporate governance are driving the strong returns ("

Investors Are Putting Big Money Into Japan Again. Here’s Why," 6/14/2023). The counterargument, at least according to my newsfeed, to GMO is that the gains are all driven by currency fluctuations. (Not my argument, and I haven't looked at the evidence behind it. I'm just reporting a headline I read yesterday). That said, the top three Japan-oriented funds over the past 10 are all ETFs, all hedged and all doing fine this year. Per MFO Premium:

1. WisdomTree Japan Hedged SmallCap: 14.4% APR for 10 years, 26% YTD, five star, Bronze analyst rating, highest Sharpe ratio, smallest drawdown,
2. WisdomTree Japan Hedged: 11.1% APR, 33% YTD, Great Owl, five star, Bronze analyst rating, tied for #2 in Sharpe
3. Xtrackers MSCI Japan Hedged Equity ETF: 10.3% APR, Great Owl, four star, Silver analyst rating, tied for #2 in Sharpe

Hennessy Japan Small Cap is the first actively managed fund on the 10-year list, at #4.
For what interest it holds, David

https://www.sec.gov/Archives/edgar/data/1032423/000103242323000063/prospectusstickersmall-mid.htm
497 1 prospectusstickersmall-mid.htm 497
DIAMOND HILL FUNDS
Diamond Hill Small-Mid Cap Fund
(All Share Classes)
Supplement Dated October 5, 2023
to the Prospectus dated February 28, 2023
Effective October 5, 2023, the Diamond Hill Small-Mid Cap Fund will re-open to new investors.
Accordingly, effective October 5, 2023, references to the closure of the Diamond Hill Small-Mid Cap Fund on pages 4, 6 and 44 of the Prospectus are removed.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE

@junkster, as imperfect as it may be, I use BKLN ETF as proxy for BL/FR funds. It peaked on Sept 15th and has been trending downward ever since. Are there better alternatives? I hold majority of BL/FR in PRWCX. The fund holds about 10-15 % BL and the rest of bonds are in treasury.

@Sven, not a bad proxy as I use it intraday along with two other bank loan ETFs. But I also use it with the previous day’s NAV to get an idea on how the open end will be priced end of day. I also use the end of the day Morningstar LSTA US Leveraged Loan 100 Index. That index peaked on September 20. It is only down around 0.65% from the top but a far cry from the trend of up, up, and up since the end of May. I could reload on bank loans if they approach the highs but in no hurry. There are some problems out there like banks and the junk corporate bond market. If the latter finally gets hit that could usher in all sorts of credit issues.

Have a heart, Your Honor!
Perhaps the judge did and may have offered parole in say just under 10,000 years :-)
Several countries have introduced CBDCs. The Fed is still evaluating digital-dollar.
Cryptocurrencies and central bank digital currencies may share much of the same technology, but they are substantially different entities with different characteristics and objectives.
From the IMF:

Central bank digital currencies (CBDCs) are digital versions of cash that are issued and regulated by central banks. As such, they are more secure and inherently not volatile, unlike crypto assets. ...
In 1993, the Bank of Finland launched the Avant smart card, an electronic form of cash. ... it can be considered the world’s first CBDC.

https://www.imf.org/en/Publications/fandd/issues/2022/09/Picture-this-The-ascent-of-CBDCs
The main objectives I've seen put forth for CBDCs are: (1) to serve the unbanked and under-banked, and (2) to facilitate secure, speedy transactions.
(Here's the full White House list of objectives.)
Those are fine objectives. Though I don't see what CBDC could offer that banks could not if they offered a form of "universal service" (with outreach programs) and perhaps made some technological upgrades. For example some transit systems now accept bank cards in addition to their own payment cards. Does it really matter whether the form of payment is a digital bank card or a government issued digital currency card?
Most of the benefits arise from "digital" not from "central bank". Much as securities transactions have become easier and faster with (digital) book entry instead of physical paper stock certificates.
Cryptocurrency is different and was promulgated on the objective of decentralization (no controlling authority). While the cryptocurrencies are not controlled by governments (clearly differentiating them from CBDCs), they have still tended toward centralized control.

[Decentralization] was the premise of the initial Bitcoin white paper, which offered a cryptographic solution intended to allow payments to be sent without involving any financial institution or other trusted intermediary. However, Bitcoin became centralized very quickly and now depends on a small group of software developers and mining pools to function. As internet pioneer and publisher Tim O’Reilly observed, “Blockchain turned out to be the most rapid recentralization of a decentralized technology that I’ve seen in my lifetime.”

https://www.imf.org/en/Publications/fandd/issues/2022/09/Point-of-View-the-superficial-allure-of-crypto-Hilary-Allen
So, there is something there that may not be obvious to all.
Sizzle?
Or as Clara Peller put it, where's the beef?

Not exactly.
The bank then has two options:
1. Sell the property at a significant discount (let's say $200M)
2. Add value to the property themselves then sell it
Assuming the lender perfected its security interest (i.e. did a UCC 9 filing to put the world on notice that it had a type of lien on the property), then in #1, the buyer would get the property subject to a $300M lien.
how many buyers do you think are out there for distressed $200M office buildings
None, and even fewer (if that were possible) who would buy a $200M office building with a $300M lien against it. Even for $1. That $200M sale ain't a-gonna happen.
As far as walking away from the loan (neither option 1 nor option 2) goes, it is premised on at best a somewhat incomplete understanding of non-recourse loans. Most loans aren't.

WHERE ARE NON-RECOURSE LOANS USED?
These loans are often used to finance commercial real estate projects and other projects that include an extended completion period. In the case of real estate, the land acts as collateral for the loan. A non-recourse loan is also used in financial industries, with securities placed as collateral.
HOW DO I QUALIFY FOR NON-RECOURSE LOANS?
Clearly, the majority of the risk and exposure with non-recourse loans rests with the lender. Therefore, a non-recourse loan may be more difficult to qualify for than a recourse loan. Commercial lenders will often only extend non-recourse loans to finance certain types of properties and only to worthy borrowers. Stable finances and an excellent credit score are two of the most important factors that a lender will look at. Generally, the loan requires the property to be a larger city, be in good condition, and have good historical financials, too.

https://fidelityca.com/non-recourse-loan-financing/
If a large player walks away from a debt, especially one that it could pay, its reputation will be mud for a long time. Most players won't risk their reputation. Though there are exceptions, and they might get lucky - they might find "a reckless institution willing to do business with clients nobody else would touch."
Historically, non-recourse mortgages arose out of the Great Depression. They made the news in the 1990s when several regional real estate markets collapsed and so many homeowners who were underwater simply walked away.

Non-recourse loans are a unique characteristic of the US mortgage market and first emerged in state legislation in the 1930s. A decrease in demand for real estate and the ensuing precipitous drop in prices during the Great Depression led to the realization of mortgages at minimal prices, significantly below their outstanding balances. As a result, not only did borrowers lose the roofs over their heads to lenders but also faced lawsuits by the same lenders for the significant remainder of their debt. This harsh reality caused many states to adopt borrower-friendly legislation. ... In effect it gave the borrower a put option

https://scholarship.law.nd.edu/jleg/vol42/iss2/2/
There are roughly a dozen non-recourse states, the largest of course being California. But it's not so simple there. A bank may execute a non-judicial foreclosure, bypassing the courts and getting a relatively quick sale. If it follows this path, it has no recourse for any deficiency (shortfall). This is the norm for small potato mortgages (I suppose that means $3M homes in California).
However, a bank is not likely to let a creditor with deep pockets like Brookfield simply walk away with a $100M deficiency. It will go through the courts. In California, judicial foreclosures are not non-recourse (pardon the double negative).
Commercial Mortgage Foreclosure (CA), Practice Note, Alston and Bird LLP (14 pages)
Yes, companies like Brookfield will default on a loan (with no recourse), hand back the keys, then buy the same asset back for a huge discount.
Pretty crazy if you ask me
Yes, the idea that they will, or even can, do this is pretty crazy.

Games people play with defaults/bankruptcy, Twitter LINK
"When a large player like Brookfield defaults on a $300M office loan they just hand the keys to the bank...
The bank then has two options:
1. Sell the property at a significant discount (let's say $200M)
2. Add value to the property themselves then sell it
Most banks choose option 1
But how many buyers do you think are out there for distressed $200M office buildings?
Not many. Enter Brookfield again...
Yes, companies like Brookfield will default on a loan (with no recourse), hand back the keys, then buy the same asset back for a huge discount.
Pretty crazy if you ask me."

AAII Sentiment Survey, 10/4/23
BEARISH remained the top sentiment (41.6%; high) & neutral became the bottom sentiment (28.3%; below average); bullish became the middle sentiment (30.1%; below average); Bull-Bear Spread was -11.5% (low). Investor concerns: Budget; inflation; economy; the Fed; dollar; crypto regulations; market volatility (VIX, VXN, MOVE); Russia-Ukraine war (84+ weeks, 2/24/22-now); geopolitical. For the Survey week (Th-Wed), stocks were mixed (cyclicals down, growth up), bonds down, oil down sharply, gold down, dollar up. Long-term rates rose dramatically with 10-yr & 30-yr yields approaching 5%. More DC drama. #AAII #Sentiment #Markets
https://ybbpersonalfinance.proboards.com/post/1202/thread

@junkster, as imperfect as it may be, I use BKLN ETF as proxy for BL/FR funds. It peaked on Sept 15th and has been trending downward ever since. Are there better alternatives? I hold majority of BL/FR in PRWCX. The fund holds about 10-15 % BL and the rest of bonds are in treasury.

+1 hank New TRP slogan : Invest With Confidence Men !

A debtor files for bankruptcy voluntarily. The idea behind voluntary bankruptcy is to protect the debtor, to provide breathing space for the debtor to restructure or start over.
https://www.law.cornell.edu/wex/voluntary_bankruptcy
OTOH, creditors can under some circumstances force a debtor into involuntary bankruptcy.
https://www.justia.com/bankruptcy/involuntary-bankruptcy/
Hypothetically, a debtor might be solvent but simply choose to stiff his lawyers, his contractors, his employees, etc. Regardless of solvency, his creditors might try to force him into bankruptcy. But the debtor is likely to argue that the amounts owed are in dispute, which is a defense against involuntary bankruptcy.
So more often, the creditors just sue. Or they might try to work some arrangement out with the debtor. From what you wrote, it sounds like ZEOIX is working those angles.
Covenants are basically conditions that a lender imposes on a borrower before lending money. A simple example: before a bank will issue you a mortgage, it will require you to have homeowners insurance. In this way it protects its security interest (the real estate) but that does little to ensure timely mortgage payments.
Conversely, breaching covenants doesn't necessarily mean that payments are missed.

DEFAULT – A failure to pay principal of or interest on a bond when due or a failure to comply with other covenant, promise or duty imposed by the bond contract. The most serious event of default, sometimes referred to as a “monetary” default, occurs when the issuer fails to pay principal, interest or other funds when due. Other defaults, sometimes referred to as technical or non-payment defaults, result when specifically defined events occur, such as failure to comply with bond contract covenants, failing to charge rates sufficient to meet rate covenants, failing to maintain insurance on the project or failing to fund various reserves. Generally, if a monetary default occurs or if a technical default is not cured within a specified period (usually after notice) such default becomes an event of default and the bondholders or trustee may exercise legally available rights and remedies for enforcement of the bond contract.

MSRB Glossary of Municipal Securities Terms

@hank- Maybe change the title head from 1.5% to ~ 5% ?

Maybe not ... :)

@ Crash,

as of September 9th, @junkster said ,
I trade only bond funds because of their persistency of trend combined with their lack of volatility. There are exceptions, but since 2000 there has always been a bond category that has beaten the S@P annually. Of course those exceptions are pretty glaring ala 2013, 2017, 2019, 2021, and so far this year. So with an extra $100,000 would just add it to the bond category that is far ahead of the bond pack this year. That would be bank loans/floating rate which I have mentioned previously, Some are already ahead double digits YTD. Aside of March they have been as steady a trender as you could want. They are massively overbought, ripe for a correction, and with fears of rising defaults. But, ( and I have to continually remind myself of this) overbought in Bondland can stay overbought for long periods of time. Then again, this wouldn’t be an investment just a trade. Investment is a foreign term to me. I think the only time I was ever in a position since the 1990s for more than four to six months was in IOFIX in 2020/2021.

https://mutualfundobserver.com/discuss/discussion/61478/how-would-you-invest-100-000-right-now/p2
——Also he mentioned few weeks later that he sold 1/3 of bank loan/ floating rate bond.———-
The quick rise rise of 10 year treasury yield has impact all bonds. I notice the short term junk bonds have peaked and falling too this week. YTD they were the few pockets of bonds that were up high single digit return. High yield corporate bonds such as TUHYX did well YTD and they also started falling last week. Is this déjà vu again of the brutal 2022 among bonds?
So what are your plan?

>>>>>September 21 edited September 21 Flag
Selling 1/3 of my bank loan OEF position on the close. Ugly day for credit including for a change the floating rate ETFs. If I am wrong will buy back. If this is the beginning of a correction will sell more. Unlike in the past cash is no longer trash.
Edit. Make that 40%.<<<<<<<<
I try to post my exits before the fact and sold 40% before the close as shown from my post above. That ugly day for credit on the 21st was a harbinger for what was to come and the top for bank loans - at least so far. The leveraged loan index has been down almost every day since and sold more till I was all in cash. It hasn’t been pretty for bank loans. As with anything they go down a heck of a lot quicker than they go up.

@MikeM : Main point , after many years in the wrong category it went from 1* to 3* !
I'm not complaining as I do own a small slice of RPHYX.
I see Buffalo kicked the snot out of Miami ! Maybe , just maybe it's their year to take the Lombardi trophy home ?!
A star is just a star, Derf

Forgot to mention, now THREE STAR !!!

@Derf, 3 stars is a comparison to the rest of the high yield category, which has had a great year but is as risky a bond category as there is. The low volatility RPHYX is definitely mis-categorized, but M* has to put it somewhere.
RPHYX has a total return of 5.3% in the past year. My memory isn't great, but I don't think anyone was buying 1 year CD's at 5.3% last October.

@BenWP, prosecutors had asked for 40,562 years. That is about 20 years per victim, and there were 2,027+ known.
Judge showed leniency and REDUCED that to 11,196 years.
Turkish judges have become wild with sentences after the death penalty was eliminated.