Personally, equities have been good to me for the past 50 years, with a few scary times in between. So, I’m not about to “jump ship”, although at nearly 74, I’m widely diversified with perhaps 30-40% in equities. Some bonds. Some commodities. Some cash. Some hedge-type funds. People don’t think there’s inflation. Look at what you paid for a house or a new addition to your home or a new car 10, 20, 30 years ago and tell me that. Sure, TVs and computers have fallen in price. You can’t eat them, drive them or sleep inside of on

You are doing fine going forward with your balanced allocation. Lots of uncertainty and volatility now. Being rational is not easy. got luck out when I rebalanced several week ago. Now I can sit back and watch the slow train wreck.

Good article from Barrons. Hopefully available to all.
https://apple.news/A3FA7CJprT0q52OyX8c5nQQ
“Japan is a value play,” says John Vail, chief global strategist at Nikko Asset Management. “But that’s also coupled with long-term structural improvements in corporate governance, operational gearing to a global economic upswing, and extreme political stability.”
“Japan is more like Germany than the U.S.,” says Masakazu Takeda, a portfolio manager at Sparx Asset Management in Japan and co-manager of the Hennessy Japan fund (HJPNX). “There aren’t too many internet companies, but Japan has highly competitive manufacturing businesses. Manufacturing excellence is one of Japan’s advantages.”

Nice to read stuff not connected to politics. :) Ritholtz is good - but the link didn’t provide much in the way of his opinions.
Lot of smart people been warning us for years about the excesses. Alas! What to do? Possibly cash at 0% is the “better” option at this time. What do I know? Stan Druckenmiller is another smart one who’s worried about valuations. And a reading of Mutual Fund Observer‘s back issues for several years brings up cautionary flags from David and others. I’m weird. I like Fleckenstein and subscribe to his daily rants. He’s about as bearish on equities as it gets. I don’t recommend him to most because I think he’d scare the **** out of you and have you run to cash - or gold which he likes.
Personally, equities have been good to me for the past 50 years, with a few scary times in between. So, I’m not about to “jump ship”, although at nearly 74, I’m widely diversified with perhaps 30-40% in equities. Some bonds. Some commodities. Some cash. Some hedge-type funds. People don’t think there’s inflation. Look at what you paid for a house or a new addition to your home or a new car 10, 20, 30 years ago and tell me that. Sure, TVs and computers have fallen in price. You can’t eat them, drive them or sleep inside of one.

https://www.sec.gov/Archives/edgar/data/924727/000110465920102657/tm2030240-1_497.htm
497 1 tm2030240-1_497.htm 497
(may wish to click link to see all information)
FPA Funds Trust
FPA Crescent Fund
Institutional Class (FPACX)
Supplement dated September 4, 2020 to the
Prospectus dated April 30, 2020
This Supplement amends information in the Prospectus for the FPA Crescent Fund (the “Fund”), a series of FPA Funds Trust, dated April 30, 2020. You should retain this Supplement and the Prospectus for future reference. Additional copies of the Prospectus may be obtained free of charge by visiting our web site at www.fpa.com or calling us at (800) 638-3060.
Effective immediately, the current single class of shares of the Fund is hereby renamed Institutional Class shares, and all references to the current single class of shares of the Fund in the Prospectus are hereby superseded and replaced with references to Institutional Class shares. In addition, the following changes are made:
The section titled “Fees and Expenses” on page 2 of the Prospectus is hereby deleted in its entirety and replaced with the following:
Fees and Expenses of the Institutional Class
This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund’s Institutional Class. The table and example below do not reflect commissions that a shareholder may be required to pay directly to a broker or other financial intermediary when buying or selling shares of this class.
Shareholder Fees (fees paid directly from your investment)
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) None
Maximum Deferred Sales Charge (Load) (as a percentage of original sales price or redemption proceeds, as applicable) None
Redemption Fee (as a percentage of amount redeemed on shares held 90 days or less) 2.00 %
Exchange Fee None
Annual Operating Expenses of the Institutional Class of Shares (expenses that you pay each year as a percentage of the value of your investment in this class)
Management Fees1 1.00 %
Distribution (12b-1) Fees None
Other Expenses (Before Short Sale Dividend and Interest Expenses) 0.07 %
Total Expenses (Before Short Sale Dividend and Interest Expenses) 1.07 %
Expense Reimbursement2 0.02 %
Total Operating Expenses Before Short Sale Dividend and Interest Expenses 1.05 %
Short sale dividend and interest expenses 0.16 %
Total Annual Operating Expenses 1.21 %
1 The Management fees include both the advisory fee of 0.93% and class-specific administrative service fee of 0.07%. For additional information about the administrative service fee please see the section titled “Management of the Fund.”
2 First Pacific Advisors, LP (the “Adviser” or “FPA”), the Fund’s investment adviser, has contractually agreed to reimburse the Fund for operating expenses in excess of 0.05% of the average net assets of the Fund, excluding management fees, administrative service fees, short sale dividend expenses and interest expenses on cash deposits relating to short sales, brokerage fees and commissions, interest, taxes, fees and expenses of other funds in which the Fund invests, and extraordinary expenses, including litigation expenses not incurred in the Fund’s ordinary course of business, through September 4, 2021. This agreement may only be terminated earlier by the Fund’s Board of Trustees (the “Board”) or upon termination of the Advisory Agreement...

Interesting:https://ft.com/content/75587aa6-1f1f-4e9d-b334-3ff866753fa2
I wonder what this means in the selloff if anything.

Well, it's been a helluva 2 days! I suppose we're just falling back to earth. But this is yet another example of the way the System is shot through with loopholes and exploitable omissions. Good thing I'm not in charge. Heads would roll. And the whole mechanism would be tighter. The frequency of this sort of news story is becoming less and less an exceptional sort of thing. So... I can't actually read the article, but I can understand LB's header. So, a handful of people "took the money and ran," eh? Suck-holes.

https://www.sec.gov/Archives/edgar/data/99188/000110465920102469/tm2030154-1_497.htm
497 1 tm2030154-1_497.htm 497
FPA Capital Fund, Inc. (FPPTX)
Supplement dated September 4, 2020 to the
Prospectus dated July 29, 2020
This Supplement updates certain information contained in the Prospectus for FPA Capital Fund, Inc. (the “Fund”), dated July 29, 2020. You should retain this Supplement and the Prospectus for future reference. Additional copies of the Prospectus may be obtained free of charge by visiting our web site at www.fpafunds.com or calling us at (800) 638-3060.
At a meeting held on August 28, 2020, the Board of Directors (the “Board”) of the Fund approved the reorganization (the “Reorganization”) of the Fund into the Queens Road Small Cap Value Fund, a series of the Bragg Capital Trust (the “Acquiring Fund”).
The Reorganization is subject to a number of conditions, including approval of the Fund’s shareholders and the terms of the agreement and plan of reorganization approved by the Board.
If the Reorganization is completed as proposed, each shareholder of the Fund would become a shareholder of the Acquiring Fund. The Acquiring Fund is an existing series of Bragg Trust with a substantially similar investment objective and similar principal investment strategies as the Fund, with certain differences, as described in the combined proxy statement and prospectus on Form N-14 (the “Proxy Statement/Prospectus”). It is currently expected that prior to the Reorganization, shareholders of the Acquiring Fund will be asked to approve the transition of the Acquiring Fund to the FPA Funds platform. In connection with this proposed transition, subject to approval by shareholders of the Acquiring Fund, FPA will serve as the investment adviser to the Acquiring Fund and Bragg Financial Advisors, Inc., the current investment adviser to the Acquiring Fund, will serve as the Acquiring Fund’s sub-adviser. Also subject to approval by shareholders of the Acquiring Fund in connection with this proposed transition, the persons currently serving on the Fund’s Board will serve as Trustees of the Acquiring Fund in replacement of the Acquiring Fund’s current Trustees.
It is expected that the Reorganization will qualify as a tax-free reorganization for federal income tax purposes, and no commission, redemption fee or transaction fee will be charged as a result of the Reorganization.
The Board’s decision to reorganize the Fund is subject to shareholder approval, though no shareholder action is necessary at this time. Shareholders of the Fund will receive a Proxy Statement/Prospectus that contains important information about the Reorganization and the Acquiring Fund in which they would own shares upon closing of the Reorganization, including information about investment strategies and risks; fees and expenses; and potential tax consequences of the Reorganization. Prior to the Reorganization, Fund shareholders may continue to purchase, redeem and exchange their shares subject to the limitations described in the Fund’s prospectus. If shareholders approve the Reorganization and other closing conditions are met, the Reorganization is anticipated to close in the fourth quarter of 2020.
The foregoing is not an offer to sell, nor a solicitation of an offer to buy, shares of the Fund or the Acquiring Fund, nor is it a solicitation of any proxy. When it is available, please read the Proxy Statement/Prospectus carefully before making any decision to invest or when considering the Reorganization. The Proxy Statement/Prospectus will also be available for free on the SEC’s website (www.sec.gov).
Please retain this supplement for future reference.

It was foolish to bid up the stocks. S&P500 lost 3% yesterday. Today it lost another 2.6% so far.

Interesting:https://ft.com/content/75587aa6-1f1f-4e9d-b334-3ff866753fa2
I wonder what this means in the selloff if anything.

Linked below is Morningstar's Fair Value Chart. To see how the market has moved in respect to fair value during the past year click on the 1 year tab. Very interesting? Yes! So, if I buy now ... I'm thinking ... that I would be over paying based upon the metrics of this chart and it's mythodology.
With this, I await a better buying opportunity.
Interestingly, Old_Skeet's market barometer indicates that the S&P 500 Index is overbought at this time as well.
https://www.morningstar.com/market-fair-value

Dows, sp500 may go up next few weeks... Maybe related long overdue correction or covid19 data improving and Techs got knocked down no support
Couple private bonds went up slightly +0.15 to + 0.25%
In two wks many people maybe crying double dip or W recovery. WE will see

The vaccine 'promise' won't matter because at this point, not enough people are going to take it. feh. Wifey and I got our flu shots day before yesterday, but I won't get a Covid-19 shot at least until fall of 2021 and maybe not then. I no longer trust anything coming out of Washington and the FDA. Any vaccine they approve will be on a scale with injecting rat poison or drinking bleach. I did hear someone suggest paying Americans $1000 each to get the shot and this is actually a very good idea. You get immunization AND stimulate Aggregate Demand.

The COVID-19 vaccine will first made available to the frontline workers including the ER's doctors and nurses, firemen and police, teachers, and military personnel. Hopefully there is sufficient dosage for the general population. There are a number of vaccine candidates which passed Phase II trial on human safety and efficacy. Moderna and Pfizer are in Phase III testing now involving 30-50K patients. It will take time to sort out the data before they launch to make billions of dosages and distribute them to the general population. It is also likely several different vaccines will be available to ensure robustness of the immunization program. Question is can the manufacturers deliver the vaccines on a timely basis?
As I stated before i will take the COVID vaccine when It is available. We took the flu vaccines several ago. The coming fall and winter will drive people indoor which could make the COVID situation worse.

Initiated a 500s likely starter position in VIRT this morning to 'play' the likely looming equity volatility surrounding the elections, covid, and general world condition. Solid company, can make $$ in any market condition, and pays a good div. IMO it's usually nice to be the 'house' in such situations.

Why the big downturn today? Poor selling data, uncertainties in market, large unemployment numbers...?
Much needed overdue corrections? Will it go 10-15% lower?

I see the US market really "priced for perfection" and to stay up a lot of things have to go right.
I think only about a third of the SP stocks are up for the year and most of the gains are FAANMG. Consequently if anything happens to get people to stop paying 50 to 300 times earnings for these things, it will be all downhill.
The market is up because 1) Federal reserve says it keep rates at zero for years, therefore increasing the market multiple ( currently at dot.com levels) 2) Stimulus bill kept consumer buying up 3) Belief that an effective vaccine is soon to come
For this to continue we have to see
1) Earnings meet the baked in assumptions of $165 S&P 500 2021 earnings
and $185 2022
2) No delayed, double-dip recession ie no resurgence of Covid this fall with the flu. I think this requires a vaccine that is at least 70% effective and most people get it. This is unlikely by December. Still it will be years before Hotels and airplanes are back at 2019 levels.
3) Low inflation and continued Fed easy easy money. What if they finally wise up to the fact that zero interest rates do not increase employment, just inflate stock prices, leaving millions in the dust ? Look at "taper tantrum"
4) No major second Black Swan. Candidates shooting war in China, massive defaults in Chinese banking system ( all very possible) or something totally unexpected ie 9.0 earthquake Major hack taking down electrical grid etc etc
5) Major fight over close election with Trump getting support form the military to stay in office and blood in the streets, or military having to remove him in shooting war with right wing nuts

Agree with @davidmoran. The recovery is uneven so far. Airline industry is in trouble with continuing weak demand in August. United and American airlines asked for more $T$ bailout to slow down the layoff as the previous $ ran out.

United Airlines said Wednesday it expects to cut 16,370 jobs on Oct. 1, far fewer than the 36,000 it warned of two months ago, as suspense builds over whether Congress will extend relief for the struggling airline industry.

https://axios.com/united-airlines-layoffs-voluntary-leave-e4ae7003-9644-44cc-adca-4fea75993a65.html
American airline also posted similar level of layoff. These are the largest US airlines. It is likely there will be consolidation of that industry to perhaps 2-3 airlines. All the smaller ones will be bankrupt or merged with a stronger company by year-end.

Yield’s getting harder this year. Unless you can stand volatility via leverage perhaps in a CEF or something like XOM or XLE.

PIMIX is significantly leveraged as well. Over half the ER, 0.59% out of 1.09%, goes toward paying interest (per summary prospectus).
Borrowing securities rather than cash is another way to achieve leverage. In round figures, the fund is 2x long and 1x short in bonds (see M* portfolio page). (Contrast that with PDIIX, which doesn't short bonds, but gets its 133% net bond holdings by only borrowing cash.)
PIMCO funds in general make extensive use of derivatives. While derivatives can be used defensively, my sense is that PIMCO uses them aggressively, further increasing effective leverage. Though with PIMCO, it is always difficult to tell what they're doing.
Regarding what PIMCO is doing, I recently ran across this analysis of PIMIX. It takes an approach similar to what S&P does in analyzing mutual funds for its individual fund reports (or did, the last time I could find them years ago). It looks at how the fund behaves, regardless of what it actually holds. It tries to disentangle the different factors by accounting for the correlations among them ("multicollinearity").
https://www.markovprocesses.com/blog/solving-2019-pimco-income-fund-puzzle/
However, it says little about derivatives, other than they're hard to deal with directly:

Pretty much all of the top holdings are either futures or swaps. Fund data and research providers, like Morningstar, as well as most institutional investors, are not capable of netting those swap positions against thousands of bonds, some of which are not easily priced. It is worth noting that the sum of top 10 derivatives positions is negative 32% and, on top of that, the fund turns over its entire portfolio every other month (472% turnover), rendering intermittently disclosed holdings snapshots useless.

Howdy expatsp/all,
You pretty much list the biggies. However, I see some of these as givens.
1. The vaccine 'promise' won't matter because at this point, not enough people are going to take it. feh. Wifey and I got our flu shots day before yesterday, but I won't get a Covid-19 shot at least until fall of 2021 and maybe not then. I no longer trust anything coming out of Washington and the FDA. Any vaccine they approve will be on a scale with injecting rat poison or drinking bleach. I did hear someone suggest paying Americans $1000 each to get the shot and this is actually a very good idea. You get immunization AND stimulate Aggregate Demand.
2. 2nd Wave is a given because we're so damn dumb and with gridlock in DC, I see nothing in the way of additional stimulus.
3. Nancy becomes President on January 21. Seriously, you know damn good and well, that Trump is going to have to be cuffed and physically removed from the White House. Sorry, but I see blood in the streets. Let me be perfectly clear, it's been 52 years since Vietnam and I finally had to go buy a GD gun. I had to arm TF up and I'm not happy about it. And not because of ANTIFA, but because of the militias and nazi groups running around playing GI Joe. These scum are too stupid to become Police Officers and too chicken shit to enlist. It's time to disarm them and the rest of the country. Ban all assault weapons, high capacity magazines and silencers. Do it state by state by referendum and city by city. Oh, and start with the schools. If government buildings can be gun free, why not the children in school?
4. Eventually the dollars' reserve status goes away but maybe not in the immediate future.
5. feh. Liz Warren is our best hope at the Treasury.
6. Nope. They'll keep pumping air in the the balloon that's full of holes and until #4 comes to pass.
and 7. Something bad happening. The Black Swan event that we're not aware of yet. How about war with China? Trump is desperate and when an animal is cornered they can be very dangerous.
That all said, congratulations to all of you that have figured a way to ride this bull and make some money. A lot of money has been made. NOW PROTECT IT.
and so it goes,
peace and wear the damn mask,
rono

APHFX seems to be hanging in at about 6%. JNK 5.4%. HYLD 4.9%.
All have experienced greater drawdown than PIMIX.

Anyone else notice that the monthly distribution has dropped from $0.0555 to $0.04? To my mind that makes this a much less appealing fund.