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Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
  • the December MFO is live
    @RandiVooDoo. Thanks. Several of us suffered on that one.
    I'd say in March 2020, both price and flow happened simultaneously. A perfect storm really.
    And I think Garrison Point, which I like, regrouped and recovered well.
    But in February 2022, as soon as price rolled again, even a very small amount, there was a massive exit and outflows just continued.
    One of the things I've learned is that when a fund does not behave the way investors expect it to, they exit ... FAIRX, AQRIX, WBMIX, IOFIX, ZEOIX, TILDX to name a few.
  • the December MFO is live
    @Charles
    Thanks for posting that frightening chart of IOFIX price and flow data. Are fund flows predictive or a retrospect tool?
  • Best month for bonds in nearly four decades
    A bond trader doesn't care what happened, only how to make money in the future.
    Examples
    PIMIX made 8-10% for several years with low SD.
    IOFIX fell 45% in 03/2020, but after that it exploded 40-50%.
    Cat bonds did not make much in previous years but did well in 2023 with a very low SD.
    HY munis made several times 3+% during 2022-23 and much more in Nov 2023.
    Woohoo.
  • 10-Year Closing in on 1.5% (OP) - Blows Right Past - Near 5% (30 months later) - Whee!
    @ Crash,
    as of September 9th, @junkster said ,
    I trade only bond funds because of their persistency of trend combined with their lack of volatility. There are exceptions, but since 2000 there has always been a bond category that has beaten the S@P annually. Of course those exceptions are pretty glaring ala 2013, 2017, 2019, 2021, and so far this year. So with an extra $100,000 would just add it to the bond category that is far ahead of the bond pack this year. That would be bank loans/floating rate which I have mentioned previously, Some are already ahead double digits YTD. Aside of March they have been as steady a trender as you could want. They are massively overbought, ripe for a correction, and with fears of rising defaults. But, ( and I have to continually remind myself of this) overbought in Bondland can stay overbought for long periods of time. Then again, this wouldn’t be an investment just a trade. Investment is a foreign term to me. I think the only time I was ever in a position since the 1990s for more than four to six months was in IOFIX in 2020/2021.
    https://mutualfundobserver.com/discuss/discussion/61478/how-would-you-invest-100-000-right-now/p2
    ——Also he mentioned few weeks later that he sold 1/3 of bank loan/ floating rate bond.———-
    The quick rise rise of 10 year treasury yield has impact all bonds. I notice the short term junk bonds have peaked and falling too this week. YTD they were the few pockets of bonds that were up high single digit return. High yield corporate bonds such as TUHYX did well YTD and they also started falling last week. Is this déjà vu again of the brutal 2022 among bonds?
    So what are your plan?

    >>>>>September 21 edited September 21 Flag
    Selling 1/3 of my bank loan OEF position on the close. Ugly day for credit including for a change the floating rate ETFs. If I am wrong will buy back. If this is the beginning of a correction will sell more. Unlike in the past cash is no longer trash.
    Edit. Make that 40%.<<<<<<<<
    I try to post my exits before the fact and sold 40% before the close as shown from my post above. That ugly day for credit on the 21st was a harbinger for what was to come and the top for bank loans - at least so far. The leveraged loan index has been down almost every day since and sold more till I was all in cash. It hasn’t been pretty for bank loans. As with anything they go down a heck of a lot quicker than they go up.
  • 10-Year Closing in on 1.5% (OP) - Blows Right Past - Near 5% (30 months later) - Whee!
    @ Crash,
    as of September 9th, @junkster said ,
    I trade only bond funds because of their persistency of trend combined with their lack of volatility. There are exceptions, but since 2000 there has always been a bond category that has beaten the S@P annually. Of course those exceptions are pretty glaring ala 2013, 2017, 2019, 2021, and so far this year. So with an extra $100,000 would just add it to the bond category that is far ahead of the bond pack this year. That would be bank loans/floating rate which I have mentioned previously, Some are already ahead double digits YTD. Aside of March they have been as steady a trender as you could want. They are massively overbought, ripe for a correction, and with fears of rising defaults. But, ( and I have to continually remind myself of this) overbought in Bondland can stay overbought for long periods of time. Then again, this wouldn’t be an investment just a trade. Investment is a foreign term to me. I think the only time I was ever in a position since the 1990s for more than four to six months was in IOFIX in 2020/2021.
    https://mutualfundobserver.com/discuss/discussion/61478/how-would-you-invest-100-000-right-now/p2
    Also he mentioned few weeks later that he sold 1/3 of bank loan/ floating rate bond.
    The quick rise rise of 10 year treasury yield has impact all bonds. I notice the short term junk bonds have peaked and falling too this week. YTD they were the few pockets of bonds that were up high single digit return. High yield corporate bonds such as TUHYX did well YTD and they also started falling last week. Is this déjà vu again of the brutal 2022 among bonds?
    So what are your plan?
  • AlphaCentric Strategic Income Fund reorganization
    Not many real estate hybrid funds around. I know of FRIFX but that may be a tamer RE hybrid fund.
    I am also familiar with TIAA QREARX (VA) that is mostly direct real estate. There are many RE equity funds (FRESX, VNQ, etc) and a few nontraded-RE funds (Blackstone BREIT, Starwood SREIT, etc).
    AlphaCentric Classes are A - SIIAX, C - SIICX, I - SIIIX (Renamed from "Strategic" to "RE")
    It may invest in RE equity (direct RE or REITs), RE fixed-income (all sorts of exotic stuff) and RE funds (a wide variety indicated including inverse- and leveraged- ETFs). I didn't find the split between equity and fixed-income.
    Non-diversified - seems unusual for a hybrid fund.
    Of course, lot of it is what one may expect from "AlphaCentric" funds (IOFIX, etc)
  • How would you invest $100,000 right now?
    I trade only bond funds because of their persistency of trend combined with their lack of volatility. There are exceptions, but since 2000 there has always been a bond category that has beaten the S@P annually. Of course those exceptions are pretty glaring ala 2013, 2017, 2019, 2021, and so far this year. So with an extra $100,000 would just add it to the bond category that is far ahead of the bond pack this year. That would be bank loans/floating rate which I have mentioned previously, Some are already ahead double digits YTD. Aside of March they have been as steady a trender as you could want. They are massively overbought, ripe for a correction, and with fears of rising defaults. But, ( and I have to continually remind myself of this) overbought in Bondland can stay overbought for long periods of time. Then again, this wouldn’t be an investment just a trade. Investment is a foreign term to me. I think the only time I was ever in a position since the 1990s for more than four to six months was in IOFIX in 2020/2021.
    Junkster, you are the most prominent trader on these forums. I find it very interesting to see what you are trading, but I know I don't have the skill set to "successfully" trade and risk my lifetime retirement accumulations, trying to emulate your investing approach.
  • How would you invest $100,000 right now?
    I trade only bond funds because of their persistency of trend combined with their lack of volatility. There are exceptions, but since 2000 there has always been a bond category that has beaten the S@P annually. Of course those exceptions are pretty glaring ala 2013, 2017, 2019, 2021, and so far this year. So with an extra $100,000 would just add it to the bond category that is far ahead of the bond pack this year. That would be bank loans/floating rate which I have mentioned previously, Some are already ahead double digits YTD. Aside of March they have been as steady a trender as you could want. They are massively overbought, ripe for a correction, and with fears of rising defaults. But, ( and I have to continually remind myself of this) overbought in Bondland can stay overbought for long periods of time. Then again, this wouldn’t be an investment just a trade. Investment is a foreign term to me. I think the only time I was ever in a position since the 1990s for more than four to six months was in IOFIX in 2020/2021.
  • Perils of Chasing Star Managers + Other Fund Stories from Barron's
    @FD1000 In other threads haven't you also advocated for owning IOFIX at times, a bond fund with an extraordinarily high for bonds 1.50% expense ratio? You've also suggested PRWCX, which, while an excellent fund, isn't cheap but average expense ratio wise and more expensive than American Funds' competitors. So it might help if you explain why these previous statements don't quite add up when combined with this one.
    Yes, years ago I used to own a lot of IOFIX. I have a system that works for me and is not recommended to anybody. I don't care too much about ER, I'm a trader.
    On the other hand, there are funds that can be great for other investors with a decent ER, such as PRWCX, PIMIX at its best and others.
  • Perils of Chasing Star Managers + Other Fund Stories from Barron's
    @FD1000 In other threads haven't you also advocated for owning IOFIX at times, a bond fund with an extraordinarily high for bonds 1.50% expense ratio? You've also suggested PRWCX, which, while an excellent fund, isn't cheap but average expense ratio wise and more expensive than American Funds' competitors. So it might help if you explain why these previous statements don't quite add up when combined with this one.
  • FD1000...3-Line Break
    i have followed fd, in one way or another, for as long as my ancient brain can remember and, truth to tell, he's made me a lot more money than i know i would have made on my own. i've thanked him publicly (and privately) and will continue to do so. even though his posting style might not always be to my liking, i just ignore the so-called bad and whistle (largely) to the bank with the good.
    he beat the drum early and often for the benefits of PRWCX, which i've steadfastly held ever since, and for IOFIX, during its stellar run (with an equal amount of thanks-for-that going to the ever level-headed and never-inflammatory junkster, long may he run). i've made money with the three-line break ... and lost it, too, largely due to my own dunderheadedness. my point is: like him or not, he brings something to the table (IMHO) and he stirs up discussion and opinion like no other and i like that and so far haven't found a reason to take terminal offense.
  • Anybody Investing in bond funds?
    Some people have T-DS and some have FD-DS.
    Hank, if you think that my system is too funny, I welcome you to dive a bit into it(link). Several did and doing very well. The whole idea is to find great risk/reward funds, small AUM is a plus, an uptrend is a must + owning only 2-3 funds. In the last several years it's mostly bond OEFs. These funds eventually get discovered. I held PIMIX for about 7-8 years, then came IOFIX. HY Munis have always been a part of it.
  • Summary of David Sherman’s 3/15/2023 web call
    >>>>“5. the commercial real estate market, which is reliant on floating rate securities, is a major and generally unrecognized risk. High quality lenders like BlackRock “are handing the keys back to the bank.” Eventually the government will need to pursue a solution like the Resolution Trust (1989-1995) to work to resolve the savings & loan crisis”<<<<
    Interesting comment especially since RiverPark offers a commercial floating rate fund RSRIX/FX
    There the manager feels his fund can generate 10% returns both this year and next year. See commentary here https://www.riverparkfunds.com/assets/pdfs/rpfrcf/commentary/RiverPark_Floating_Rate_CMBS_Fund_4Q22_Investor_Letter.pdf
    Interesting backstory on RCRIX. From early November through mid February this fund steadily rose without one down day (excluding monthly dividend payout days). I thought I had found another IOFIX. I bought at the beginning of January and it quickly became my largest holding. Sold after it had an uncharacteristic 2 cent down day in early March and it is down working on a 8 day losing streak. Have since been banned from all RiverPark funds. Even more interesting a friend who held this fund placed an order to sell late one evening after market close. He received a ban notice the next trading day before market close and his order was even filled. I had never heard of that before,
  • SEC comes through for small investor
    On a previous thread about IOFIX and variable prices vs NAVs,I elaborated on the fact that FARIX changed the price of their fund two months after I sold it and clawed back over $500 from me.
    I filed a complaint with the SEC with the details of the dates shares etc. It took a couple of months but the SEC acknowledged my complaint and asked the fund company what happened.
    Today they responded :
    " U.S. Bank Global Fund Services made an accounting error in the Fulcrum Diversified Absolute Return Fund from June 9, 2022 until August 30, 2022. As a result, the net asset value of each share class of the Fund were redetermined for the period. The maximum error during the period was $0.07 per share, representing approximately 0.77% of net asset value, for each class. As a result, in accordance with Fund policy and in coordination with the Fund, shareholder purchases and sales between those dates were reprocessed.
    Based on industry accepted practices, U.S. Bank Global Fund Services, as transfer agent for the Fund, initiated reprocessing of transactions on September 13, 2022 to make shareholders and the Fund whole. U.S. Bank Global Fund Services followed normal instructions to notify intermediaries, including Schwab and Fidelity, of the NAV correction issue and asked for assistance to get shareholder activity in alignment with the corrected NAVs. The intermediaries, including Schwab and Fidelity, then reprocessed the applicable transactions for their customers.
    As a good faith gesture to Fulcrum and its shareholder, U.S. Bank Global Fund Services will reimburse the shareholder "
    While my original question of "So What it was your mistake, why do I have to pay for it" was sorta ignored, they are making up the difference.
    So it does make sense not to "just lie down and take it".
  • RPHIX vs US Treasuries vs CDs
    Funds with rates that can float upward like RPHIX will continue to do better until rates start to drop. Unless you are sure you can tell when that is, you make be behind your CD or Treasury rate over almost any time period.
    While I assume most of us have a great deal of confidence in RPHIX and it seems transparent, I am always a bit leary of funds that invest in high yield securities and things that can go bust. Don't forget IOFIX
    Reaching for an extra half point of yield will probably be Ok, but you never know.
  • IOXIX Blowup From IOs
    @derf
    You read what I meant correctly the first time.
    Twice I have had a mutual fund company several months later change the price at which I sold their fund, to their advantage I might add.
    In 2016 I sold MBXIX in two of our accounts at one price, only to have Schwab and Fidelity later change the price, resulting in less money to us.
    Most recently I sold FARIX in both my and my wife's retirement accounts for $9.20 a share on July 15 2022, only to have both Schwab and Fidelity change the price to $9.14 on September 22,2022. They canceled the first trade and put in another at the lower price, resulting in $300 fewer dollars to us.
    Schwab was nice enough to send a letter. Fidelity never notified us. I called Schwab and they said that if a mutual fund company tells them a previous price was inaccurate, they accept that number and follow thru, changing the trade.
    I posted about the MBXIX when it happened, and have never wanted to do business with Catalyst again. I emailed them but never got a reply. I think I even emailed the SEC.
    I assume the change was for the reasons stated above, ie thinly traded securities, but it is amazing that the SEC lets companies do this, rather than making them eat the difference.
    Given these examples, and the IOXIX example and IOFIX disaster a year or so ago, I am very leery of investing large sums in funds using "thinly traded" securities.
    Of course, with the very broad mandates most funds have now, you hardly know what many mangers are buying.
    If anybody else has had this problem, I would like to hear about it. Maybe if enough people complain something will be done
  • AlphaCentric Income Opportunities - A Cautionary Tale
    There were several views but no comments on a previous post on this,
    https://www.mutualfundobserver.com/discuss/discussion/60008/m-on-iofix
    That was one of several threads I had comments on, but little time now. Quick post ...
    Whatever happens, AlphaCentric Income Opportunities’ rise and fall is yet another example of a bond fund that flew too close to the sun and got burned.
    That's a fair description of many funds, equity as well as fixed income. Funds can take on risk that don't show up in statistics like volatility or risk adjusted returns because the risks don't play out frequently. But the risks are there; not exactly in plain sight, but often clear if one looks and expands one's definition of risk beyond the usual metrics.
    It's somewhat like living on a fault line. You may not experience anything for decades. Still the risk is there and sooner or later something bad is going to happen. The fault line is below ground, so you have to look for it. But it's not exactly hidden in the sense of being unknown and/or undiscoverable.
    "Latent" (M*'s word)? Maybe. Discoverable? Often, and if not, that alone can serve as a yellow flag.
  • AlphaCentric Income Opportunities - A Cautionary Tale
    Thanks for bringing this to my attention.
    I missed the prior IOFIX post.
  • Multi-Asset Income Funds: Is the Extra Income Worth the Extra Risk?
    msf said:
    "A bet on higher yield may pay off nine years or out of ten, or even better, but that just means that when 00 comes up, the impact is likely to be more severe. IOFIX, SEMMX and their brethren were never "cash subs", regardless of how sedate they looked before 2020."
    IOFIX and SEMMX were touted as "cash subs" by some participants on another investing board.
    This was before IOFIX returned -36.18% and SEMMX returned -20.85% in 2020 Q1 ¹.
    ¹ returns reported by Morningstar