Value Versus Culture

By Edward A. Studzinski

“In order to become the master, the politician poses as the servant.”   

– Charles De Gaulle

One of the more interesting additions to portfolios, looking at various reports for the third quarter just ended, is that of Alibaba, the largest e-commerce company in China. Over the last year, the company has been in the news any number of times. There have been huge fines imposed on it by the Chinese government. The founder, Jack Ma, after giving a rather provoking speech in 2020, dropped out of view for a time, although he has now resurfaced. Over the last twelve months, the share price has Continue reading →

Standpoint Multi-Asset Fund: Forcing Me to Reconsider

By David Snowball

I have a deep distrust of managed futures funds. The logic is simple: isolate asset classes that are uncorrelated, invest only in the uptrending assets, ignore (or short) the losing classes, and you get a long, smooth ride to prosperity.

The research behind them is so beautiful and compelling. Various backtests suggest that a managed futures strategy would have returned 13.5% annually for the period 1972-2010.  During that same period, the equity market would have returned Continue reading →

Building a Multi-Strategy Portfolio – Vanguard Traditional IRA

By Charles Lynn Bolin

I divide my investing strategy into the low cost, buy and hold philosophy following that of Vanguard, and its founder, John Bogle, along with Charles Ellis, and the more active business cycle approach of Fidelity, Benjamin Graham, Howard Marks, and Ed Easterling, with a touch of trend following from Gregory L. Morris using a risk-managed approach of Mutual Fund Observer, the bucket approach of Morningstar, and the tax strategy that I learned late in life. Whew! This article Continue reading →

Red flags over China

By David Snowball

There is an ongoing debate about whether Chinese President Xi’s economic reforms fundamentally threaten the investment case for China (and, by extension, for the emerging markets universe which China dominates). The Economist warns that “China’s new reality is rife with danger” (10/2/2021):

His campaign is remarkable for its scope and ambition. It started to rumble in 2020, when officials blocked the initial public offering of Continue reading →

Super Bull Markets and Latest Upgrades To MFO Premium

By Charles Boccadoro

Last month, in “A Leap of Faith – MICUS Chicago 2021,” we noted that Morningstar’s CEO Kunal Kapoor recently described US equities as “one of the greatest bull markets.” The statement looks past March 2020, of course. Similarly, many who discuss the great bull markets of the 1980s and 1990s, don’t acknowledge the sudden decline of October 1987, so-called “Black Monday.”

Basically, both retractions were so short, each just three months, they just Continue reading →

Elevator Talk: Amy Greer and Jennifer Klass, Baker McKenzie

By David Snowball

MFO’s Elevator Talks serve as a way of introducing you to smart people who (a) we’ve only recently met and (b) we’ve become convinced that you should hear from. In the usual course of events, that translates to a fund manager whose approach seems promising and intriguing but whom we’re still learning about (and from). Elevator Talks aren’t recommendations. They’re invitations: to hear from impressive folks, deepen your understanding of important issues and strategies.

In the normal course of things, we interview fund managers. Continue reading →

old license plates on a wall

Funds in Registration

By David Snowball

The Securities and Exchange Commission, by law, gets between 60 and 75 days to review proposed new funds before they can be offered for sale to the public. Each month we survey actively managed funds and ETFs in the pipeline. This month brings 39 new products in the pipeline, most of which will launch by the end of December. Only Smead International Value overtly flags a 2022 launch.

The four most important words to keep in mind when you’re reviewing this month’s filings: Continue reading →

old alarm clock

Manager Changes, October 2021

By Chip

Each month we track changes to the management teams of actively managed, equity-oriented funds and ETFs. That excludes index funds and most fixed income funds. The index fund exclusion is pretty straightforward: in a passive fund, the managers are interchangeable cogs whose presence or absence is almost always inconsequential to the fund’s performance.

Similarly, most bond fund managers have a very limited ability to add value. For instance, over the past ten years, the top-performing Core Bond fund in the Lipper universe outperformed its peers by just 1% per year with a virtually identical Sharpe ratio (0.98 for the top returning fund, 0.97 for the top returning the average fund). The best global income and flexible income managers outperformed by 3.5 and 2.4%, respectively, which is comparable to the margin between the best large-core equity fund managers and the pack.

This month, we noted 55 funds with changes in their management teams. The 700-pound Continue reading →

fountain pen writing a note

Briefly Noted

By David Snowball


The Ivy Fund liquidations announced in September 2021 and October 2021 have been temporarily suspended. No word on why or when the executions will proceed.

Briefly Noted . . .

The Cook & Bynum Fund modified their prospectus to flag a new risk factor, one that’s likely unprecedented in the industry: Risk of Current Focus on Breweries and Soft Drink Bottling and Distribution. The adviser allows that they hold “from time to time, a Continue reading →