August 5, 2018

By David Snowball

Dear friends,

Thanks for your patience. The end of July and beginning of August brought a bunch of challenges.

This month’s issue has a lot of interesting content; just not quite so much as we’d planned. With luck, we’ll shift the vast bulk of it to September.

Zoom in to Charles and the MFO Premium walk-through

MFO Premium offers a ridiculous wealth of information for a Continue reading →

Dotcom 2018 – This Time It’s Different?

By Edward A. Studzinski

“If you attack stupidity you attack an entrenched interest with friends in government and every walk of public life, and you will make small progress against it.”

     Samuel Marchbanks

Those of us who were value investors and running money back at the beginning of 2000, remember what a horrible time it was. For some years value had been lagging growth in performance. We were routinely told, either in emails or other communications from our investors, that our style of investing was never coming back, that we were dinosaurs who hadn’t recognized that we were extinct, and that technology stocks were the place to be as they represented the Continue reading →

Introducing Ferguson Metrics

By Charles Boccadoro

Ferguson Metrics help identify funds with equity-like returns but volatility that makes them “easier for investors to own through turbulent times,” describes Brad Ferguson of Halter Ferguson Financial, a fee-only independent financial advisor based in Indianapolis. They serve as a starting point for delving deeper, but also as litmus test when salespeople offer him funds to include in the firm’s portfolios.

There are three main metrics in Brad’s Continue reading →

Launch Alert: Fidelity ZERO Total Market Index Fund (FZROX) and Fidelity ZERO International Index Fund (FZLIX) 

By David Snowball

We’ve got Coke Zero. We’ve got Pepsi Zero. I guess it’s reasonable to wonder, why not Fidelity Zero?

Wait, we don’t have Coke Zero or Pepsi Zero. They both failed in the marketplace and had to be reformulated, renamed and relaunched.

But we do have Fido Zero.

On August 3, 2018, Fidelity launched two zero/zero index funds sporting zero Continue reading →

Advice not to follow: Inverse ETFs as a hedge

By David Snowball

It’s sensible to think, in advance, about the best responses to a market that is expensive, increasingly volatile and beset by external shocks, from tariffs to rising interest rates and policy instability.

An unauthored piece in ETF Trends recently weighed in with this advice: look at buying inverse or levered inverse ETFs.

With the heightened Continue reading →

Advice not to follow, #2: Avoid ESG funds, they’re losers

By David Snowball

The most consistently strong analyses of US and world markets come from a shrinking handful of sources, The Financial Times and The Wall Street Journal prominent among them. MFO maintains a paid subscription to each.

Nonetheless, even they produce the occasional bewildering piece. In “If you want to do good, expect to do badly” (6/29/2018), the Journal’s James Mackintosh revives an old canard. “Investors are increasingly convinced that they can buy companies that behave better than the rest and make just as Continue reading →

Elevator Talk: Jim Callinan, Osterweis Emerging Opportunity (OSTGX)

By David Snowball

Since the number of funds we can cover in-depth is smaller than the number of funds worthy of in-depth coverage, we’ve decided to offer one or two managers each month the opportunity to make a 200 word pitch to you. That’s about the number of words a slightly-manic elevator companion could share in a minute and a half. In each case, I’ve promised to offer a quick capsule of the fund and a link back to the fund’s site. Other than that, they’ve got 200 words and precisely as much of your time and attention as you’re willing to share. These aren’t endorsements; they’re opportunities to learn more. 

People love fireworks, those happy confections of explosive Continue reading →

old license plates on a wall

Funds in Registration

By David Snowball

A surprising number of interesting funds have quietly entered the SEC’s new-fund pipeline. While we don’t cover passive ETFs or funds not available to the general public, even there there were interesting developments. DFA Emerging Markets Targeted Value Portfolio will target small and mid-cap EM value stocks, which is consistent with DFA’s research bent and validates the increasing interest in EM value. Impact Shares YWCA Women’s Empowerment ETF will target firms whose values align with the YWCA’s long-time public goals. Of more direct interest, Rajiv Jain of GQG Partners is launching a fund focusing on US equities, a long-time AllianzGI manager is adding an EM value fund to the mix, The Great Gabelli is seizing the helm of his 15th fund and a team from France is offering a direct challenge to the ideology of market-cap-weighted indexes. Continue reading →