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The September issue has been posted

chipchip
edited September 9 in Fund Discussions
Welcome to the September oh-so-totally back-to-school issue of the Mutual Fund Observer at https://www.mutualfundobserver.com/issue/september-2025/!

Highlights of this issue include:
  • Lynn Bolin examines low-correlation alternatives in "BlackRock Systematic Multi-Strategy (BAMBX) versus BlackRock Tactical Opportunities (PCBAX)," seeking funds that can provide steady 5% returns with minimal correlation to traditional stocks and bonds.

  • His companion piece, "Preparing for an Inflection Point on Interest Rates," responds to recent economic signals, including revised employment data, rising producer prices, and Fed Chair Powell's Jackson Hole remarks about potential rate cuts. Lynn anticipates sustained financial volatility with higher real interest rates and more frequent debt crises, and walks through portfolio protection.

  • I share a Launch Alert for Franklin Multisector Income Fund, which debuted in the last week of August. The fund resonates with Lynn’s concern about finding investments that are insulated from the probable instability ahead, while at the same time offering the prospect of decent returns while we wait. The literature surrounding it got me thinking about the prudence of looking at income funds that were (a) successful and (b) determinedly isolated from the wobbles of the US market, which led us to …

  • “Thinking more broadly: Bonds beyond vanilla,” in which we launch a systematic search for income-oriented funds that are insulated from the local lunacy. A screen for funds that could invest flexibly, have made 4% or more over the past five years, are uncorrelated with the US bond market, and qualify as MFO Great Owls (a sign of top 20% risk-adjusted returns across a range of examination periods). Sixteen such funds are available to regular investors, a combination of funds that we’ve written a lot about and ones that we’d never heard of.

  • And The Shadow, as ever, tracks down a horde (perhaps a hoard) of industry developments, including a huge number of OEF-to-ETF conversions, two interesting reopenings, and the ongoing flight from funds grappling with climate change. (Pity.)

Comments

  • hank
    edited September 9
    Thanks to all for another outstanding edition. Enjoyed Charles’ deep dive into income producing funds. Quoting from that section: “… we are in the midst of a fiscal mess, which is likely to get messier and messier. It would be prudent, before any panic sets in, to examine the question: are there ways to reduce my exposure to emerging risks and still earn a decent return?”

    ”Up the creek without a paddle” comes to mind. We are in need of one. Perhaps some of the funds mentioned may offer relief.

    Interesting comparison of BAMBX vs PCBAX. True, BAMBX hasn’t done well recently. I own it and believe part of the problem may be the renewed meme stock craze. A portion of the fund shorts lower quality stocks and goes long higher quality ones - part of an intricate hedging process. I’d say it’s the market that’s currently out of whack - not the fund.
  • yogibearbullyogibearbull
    I have had CEFS for a while. It's a conservative=-allocation ETF of CEFs. Its ER is high even considering that underlying CEFs have high ERs due to leverage. I went into it thinking that it will get some boost from Saba's activist campaigns. But it has been so-so.
    It's a multi-asset fund, not a flexible/multisector/strategic bond fund.
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