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edited August 2013 in Fund Discussions
I don't know how many of you invest with MICHAEL HASENSTAB and his funds at Templeton.
I never did get an opportunity as their funds are loaded. With his CEF funds available on discount now, Isn't it a good time to invest in his funds, either GIM or TEI. I hold MAINX from Mathews and it focusses on just Asia ex-Japan.
Thinking of switching to TEI or GIM (not same category but still a good fund) by selling MAINX.

What do you guys think ?


  • Good observation. Personally, in a more conservative account with only OEF's I own TGBAX & TGEIX. In a more aggressive portfolio I am currently constructing, I have both GIM & TEI (also small position in FAX), as well as MAINX. FWIW, allocations for the funds are:

    GIM: 1.5% with target allocation of 4-5% (waiting for some cash from a 401k rollover, Merrill Lynch is SLOW)
    TEI: 3%
    MAINX: 2%

    If you can stomach the volatility and understand CEFs, TEI & GIM look attractive at ~$14 and ~$8. Personally would, and actually am, keeping MAINX:)
  • Dear mac70: For your information. Both GIM & TEI are selling at a discount, and it might be time to take a position. I also like FAX
  • fyi, not sure if you are aware, the Templeton Global Bond fund comes in classes other than a load fund. I own it as FGBRX.
  • beebee
    edited August 2013
    Also I am not sure how closely TTRZX resembles TGBAX in make up, but TTRZX has an ER of .79 and is NTF at many brokerage houses and has outperformed TGBAX over the last 5 years. Here are the to charted together:

  • Hi mrc,

    Among the MH managed funds, my preference would also be the Templeton Global Total Return fund, and among the various classes, TTRZX would be my top choice. However, this class is only available at Firstrade by test trade, and is not available without an advisory account at Wellstrade, Fidelity, TDA and Scottrade. The next best option would be TGTRX-LW which is available at Schwab. I would advise caution with regards to CEFs, due to fluctuating discounts and premiums to NAV, and would make certain you are comfortable owning them.

    Thanks for your kind words on the Vanguard thread. And the past is long gone, and we are here to help each other.

  • These funds may be harder to find (without a load), than people think.
    I have verified that TTRZX (and TGBAX) are available at Firstrade, as Kevin stated.

    But, while Schwab shows TGTRX as NTF, Schwab only offers these shares to institutional investors. When I try to find a world bond fund from F-T available to retail investors, Schwab just comes back with TPINX (with front end load), TEGBX (with a level load, and limited to redemptions), and Class C of Templeton Total Global Return (also with a level load). That last one is worth highlighting, because sometimes Schwab using its own internal tickers for funds. Here it is using TTR1Z instead of the standard TTRCX. Perhaps Schwab also has its own symbol for the TGTRX shares that it sells to retail customers?

    Just as C shares are level loads, apparently so are the R (retirement) class shares FGBRX. These charge so much in 12b-1 fees, that like C shares, they must be called load funds. Those extra fees likely go to paying the retirement plan provider, so that the employer sponsoring the plan doesn't have to pay for the plan. (They're also offered in 529 plans and HSAs, where the fees would similarly go to the provider of the plan.)

    So as near as I can see, the only way right now to get access (at the retail level) to noload open end versions of Hasenstab funds is to go through Firstrade. (They're in Flushing, Queens for anyone who wants to walk in.)
  • Reply to @msf:

    USAA brokerage offer TTRZX NTF, but at a $50K initial minimum.
  • msf
    edited August 2013
    Reply to @bee: Thanks. I keep forgetting about USAA. Do they require military service (or relationship) for their brokerage as well as other services?

    Since we're bringing up what may be "limited access' methods of buying the fund without a load, legacy Mutual Series investors have a back door available. If you've owned Mutual Series funds continuously since 1996 (now Z shares), you're grandfathered in. You can purchase any Mutual Series fund Z shares (no load), and then exchange at NAV into the A shares of the Templeton bond funds such as TGTRX.

    (I've always been curious whether you could try an exchange without the continuous ownership - e.g. buy MDISX at Scottrade, and then exchange some of the shares A shares at NAV. It shouldn't work, but F-T has rewritten the rules so many times that this may now slip through.)
  • edited August 2013
    Reply to @msf: I think the military service (or relationship) is only for their insurance business.

    Update: Here it is:

    It looks like everything except auto and property insurance services are available to non-military audience.

    Expand "Other Individuals". It says:
    "Our investment products, life insurance, and shopping and discounts are available to other individuals.
    USAA auto and property insurance and USAA banking services are not available due to membership eligibility requirements. New Hampshire and North Carolina residents who are not eligible for membership may be able to obtain USAA auto insurance by calling 1-800-531-USAA (8722) to determine eligibility as defined by these states' mandatory coverage laws.
    All other individuals not eligible for USAA auto insurance may be able to obtain an auto policy through Liberty Mutual Insurance by calling 1-855-349-2149."
  • A cautionary word about discounts on CEFs in the current interest rate environment. These discounts can disappear pretty quickly, since they are reflective of bond prices. These are probably not buy-and-hold investments given what could be a period of rising interest rates.

    The main difference between Templeton Global Bond and Templeton Global Total Return is the latter's ability to own non-government (sovereign) foreign bonds. Because of this, it has a slightly longer duration and average maturity. And it currently has almost 40% in "cash", about double the cash in Global Bond. Given what has happened with most foreign bonds and currencies this year, Hasenstab's numbers are mighty impressive.
  • Reply to @BobC: I have been thinking of moving my TGEIX and FNMIX EM to TGBAX. Why continue to hold EM funds until they turn around when I think TGBAX is manageing it better?
  • Reply to @bee: Don't think it is available through USAA brokerage. Am I missing something? Templeton Global bond is available in several share classes.
  • Reply to @BobC: I have notes from over a year ago on the differences between the two, and they are similar. Also wrote down that the U.S. was the 2nd largest holding in Total Return, but is not in top 3 holdings of Global Bond. Assumption was its due to the small amount of corporate, but that was a long time ago so don't take my word for it and definitely do the necessary DD. At the time more than half of Global Bond was in cash, and less than half for Total Return, FWIW.

    Reply to @ron: Was going back and forth a couple years ago on both of those holdings (already had invested in TGBAX) and whether or not to split the EM bond holdings between the two, before finally settling on on TGEIX due to some underperformance by FNMIX at the time.

    Contemplated the same thing recently and would like to increase exposure to TGBAX in one account and for this most recent one the target allocation for GIM is much higher than EM. However, because I'm using CEF's, some of the EM exposure I do have is invested in TEI which is managed by Michael Hasenstab. My thinking is that emerging markets are undervalued right now relative to the rest of the market.
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