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Charles
Thank you sma3! We are spending this summer in northwest again. I have no quiet place I can be before noon eastern (9 am here). Library opens at 9am! I've set up a session for Friday, 2 pm eastern ... posted on board. But, if that does not work, just call me at 805 468 9599 ... if I can pick up I will. Hopefully, can pick a day where you can attended from noon on. Very happy to do! c
Good link catch22. I see to the fund has most of its assets in BBB, which I believe is the lowest level of Investment Grade (IG) bonds. The Fed backstop has helped stabilize the IG market, but I fear companies (and their debt) may get downgraded in …
Ha! I used the quote recently.
Just checked AUM ... $1.7B, down from $4.5B. The irony is that today's level is where they were when they told me they were "day to day" on inflows.
I loved these guys, their firm, and their strategy. The AUM growth …
@catch22. I know. Unprecedented really. How could there not be a robust market for TLT? But there wasn't ... until yesterday. Here's illustration ...
https://twitter.com/MstarETFUS/status/1242452746466402305?s=20
I suspect they need to survive redemptions first, then see what’s left. Until the Fed stepped-in yesterday, even highly traded ETFs like TLT and LQD had big discounts between price and NAV, signaling liquidity concerns with IG bonds. There are smart…
OMG. There will be a focus on fixing pricing mechanisms and/or imposing holdings regulations in future with fixed income, but we need to get through this crisis first.
@OJ. I don't know either, but when we get through this crisis, bond oef/etf pricing mechanisms and/or holding regulations will have to be improved. A dream I have.
Thanks for sharing sma3.
The “recent dislocation is one of the most rapid and severe we’ve seen—and this is all with the backdrop that there are no solvency concerns around the mortgage agencies, Fannie Mae and Freddie Mac, in contrast to the exper…
Another 14% down today, which is slightly better than I feared.
@Old_Joe. I agree with you that the topic of liquidity has been written about in our commentary (by Ed) and on the board by many, but I've never seen a fixed-income fund fall so much s…
Beautiful! Yes, I noticed too that RPHIX has not suffered losses like ZEOIX, DODIX, PIMIX. Yes, closer to MINT. A rare bright spot in the fixed income market. (Although RSIIX has not fared particularly well.) Be very curious about his views on liqui…
As corporate debt gets downgraded in days/weeks ahead, fixed income funds/pensions/endowments with mandate to hold only investment quality bonds will be forced to sell, even if the current redemption pressure eases.
Yes, thanks Mark. I share Mr. Barnes view that we will get through this, but after last week, I believe things will get worse first. Not looking forward to the market moves on Monday. And, yes too, I think MBS is on-sale like many assets right now. …
Got it. So in this environment we must all be watching prices daily? I know that is a strategy and certainly works well for Junkster. I understand one reason ETFs started was in response to Black Monday 1987. Maybe some assets (and some types of fun…
@MikeM and @newgirl.
Thinking more about the letter MikeW shared ...
If the sudden drops are caused by forced redemptions, which I fear they are, the situation seems tough.
Forced redemptions mean discounted prices on thinly traded assets, which …
I wholeheartedly agree with Mark. It's amazing how forthcoming fund houses can be when things are going well. The better test is whether they keep communicating when things go wrong. I remember D&C's folks in 2009 were constantly engaged with wo…
How does it end well? We start to see other countries come back online. We start to see leveling off of CV-19 cases. We see less death than feared. We give subsidies, extend loans and restructure debt ... slip payment due dates. Maybe outright forgi…
I see financials at levels I've not seen in years ... BAC under $20, WFC under $30.
I think these are sales for long-term investors.
I suspect the folks at D&C are well prepared and are working overtime to capitalize. But after this past week,…
The bond market probably does need better pricing mechanisms for lightly traded assets.
On no further information, I think this turned into a classic run on the bank. I suppose they could attempt to stop redemptions, like Third Avenue did if I reca…
Of course, next week markets could close if the nation does indeed lock-down. They should probably have closed this week, like they did after 9/11.
I just don't know how far down it will go.
20-Mar 17.2
19-Mar 10.7
18-Mar 2.7
17-Mar 1.9
16-Mar 2.…
@Rono. Yes. When my home state of CA ordered everybody to stay home yesterday, that got my attention. Factories like Tesla closed. At first I thought this would be like 1987 or 9/11. Quick because it is event driven. But the nation's fragmented resp…
@linter. Good job. The signs were there last week based on their past performance ... the fund never goes down! So, when down 7, it signaled something was wrong since less liquid assets are hard to price. But, I figured in comparison to core bonds a…
Down another 17% today.
So, clearly, everybody running for door (including me) and no willing buyers.
Extraordinary 5 years, until it wasn't, like Mark and Mona posted.
Really, really hard couple days.
Until today, it had actually been tracking to core bond funds, like DODIX, down about 9% from peak. And, it continued to do a bit better than PIMIX, down 13% ... it dropped 2.5% today as did ZEOIX (double ouch). I saw a dislocation in REITs earlier …
@Mark.
"I also could never figure out how to use the MFO premium site but that's a whole different lesson plan for another day. "
Let's hook-up. I'd like to walk you through it via screenshare.
Please email me ([email protected]) a g…
