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“The Fund seeks to provide current income, with a secondary objective of capital preservation in a rising interest rate environment. It will allocate its portfolio in fixed income securities through the purchase of closed end investment companies and exchange-traded funds that invest in income producing securities.” http://www.funds.reuters.wallst.com/US/funds/overview.asp?symbol=HOBEX.O
I like to look at MaxFunds along with Lipper and M* for insights. MaxFunds is sometimes wrong - but “never in doubt” (willing to go out on a limb with their projections). Their rating for HOBEX is +2 out of 100. http://www.maxfunds.com/funds/data.php?ticker=HOBEX&pg=d
Not sure how you came by this fund - possibly thru some employer’s plan. My take is that the problem with the fund probably relates as much to the high-wire act they are trying to execute and the high fees and trading costs as with management. Along a similar vein, Price has a new hedged income offering, TMSRX, also with lackluster results, but having a lower 1.37% ER (and somewhat lower turnover rate).
Anytime I see 138% turnover / 1.84% ER have to wonder what in the world are they trying to do ...
But I can understand to a degree people seeking out alternatives for various reasons. Unfortunately, have yet to see one that’s worth its salt.
Here is a reminder of that incident:
Here is a link for Cramer on the same issue: