Updates
Chicago Equity Partners Balanced (MBEAX) no more. MBEAX has been a splendid performer that mixed high-quality, larger US stocks (93% mid- to mega-cap) with investment-grade bonds (99.5% BBB or above, at last reading). Effective April 17, 202, it became the AMG GW&K Global Allocation Fund (MBEAX) with a new name, new team, and new discipline. The portfolio shifts from domestic to global in both its equity and bond sleeves.
Investors should treat this as an entirely new fund. Morningstar will continue to allow it to claim its current four-star rating but they’ve placed it “under review” so far as their analyst rating goes. Investors ought to do likewise. Chip, who had a position in the fund, has moved it to cash pending a review of her options.
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The Investor share class for EAS Crow Point Alternatives Fund (EASAX), Crow Point Global Tactical Allocation Fund (CGHAX), and Crow Point Alternative Income Fund (AAIFX) will be eliminated on May 29, 2020. At the same time, the word “Timber” will replace the word “Crow” in each fund’s name, presumably on marketing grounds. A “murder of crows” and all that.
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A wide variety of advisors – having forgotten to latch the barn door in the first place – have continued filing helpful amendments to their risk statements. Upon reflection, they’re decided to warn us that a global pandemic might disrupt financial markets and adversely affect their portfolio holdings. I extend thanks on behalf of all of the investors who would not otherwise have been aware of that risk by now.
Briefly Noted . . .
All of the Alpha Architect funds will transform from passive to active on July 1, 2020. The change reflects the extent of the gray area between an active quant fund and a passive fund that follows a self-designed index. The filing notes that “the Adviser will use a quantitative model to identify which securities each Fund might purchase and sell as well as opportune times for purchases and sales. The Adviser’s methodology will be substantially unchanged from the current approach it uses to manage the Funds.”
| Index tracked | New Investment Objective | |
| Alpha Architect U.S. Quantitative Value ETF QVAL | Alpha Architect Quantitative Value Index. | long-term capital appreciation. |
| Alpha Architect U.S. Quantitative Momentum ETF QMOM | Alpha Architect Quantitative Momentum Index. | long-term capital appreciation. |
| Alpha Architect International Quantitative Value ETF IVAL | Alpha Architect International Quantitative Value Index. | long-term capital appreciation. |
| Alpha Architect International Quantitative Momentum ETF IMOM | Alpha Architect International Quantitative Momentum Index. | long-term capital appreciation. |
| Alpha Architect Value Momentum Trend ETF VMOT | Alpha Architect Value Momentum Trend Index. | long term capital appreciation while attempting to minimize market drawdowns. |
No changes in the fees or expenses charged by the Funds will result.
Amidst the madness that afflicts oil ETPs, ProShares K-1 Free Crude Oil Strategy ETF (OILK) has announced a series of portfolio shifts. One shift is moving toward longer-dated futures. The other is to open the option of investing in “other crude oil-related investments, such as futures contracts on other crude oil benchmarks (for example, ICE West Texas Intermediate (WTI) Light Sweet Crude Oil Futures Contract), options on crude oil futures contracts, swap transactions or futures contracts on exchange traded funds that provide exposure to crude oil or crude oil futures.” Year-to-date (4/28/2020), the fund is converted a $10,000 investment into a $2,074 portfolio.
On the bright side, that edges out the returns on the United States Oil ETF (USO): -79% versus -83%.
SMALL WINS FOR INVESTORS
Dana Small Cap Equity Fund (DSCIX) and the Dana Epiphany ESG Equity Fund (ESGIX) will convert their “Investor” shares into “Institutional” shares on June 4, 2020, at which point the Institutional shares will announce a $5,000 minimum investment. That’s down from $1 million and $100,000, respectively, owing, perhaps, to the fact that the funds have barely $20 million between them. (Trailing your peers in 100% and 80%, respectively, of calendar years, tends to have that effect on investor enthusiasm.)
Effective on April 24, 2020, the minimum initial investment amount RiverNorth Core Opportunity Fund’s Institutional Share Class (RNCIX) will reduce from $5,000,000 to $100,000.
Effective as of April 6, 2020, the Towle Deep Value Fund (TDVFX) was reopened to new investors. Towle is distinguished for owning stocks that are far smaller and far more deeply discounted than its peers. Perhaps, in consequence, the fund is a bit streaky in terms of performance. Here are its peer rankings in each of the past nine years.
CLOSINGS (and related inconveniences)
Vanguard Treasury Money Market Fund (VUSXX) is closed to all new investors. At base, this is a move to protect existing investors. The managers simply don’t want to be forced into buying a bunch of new T-bills paying 0.10% for a fund charging 0.09%.
Walthausen Select Value Fund (WSVRX) is eliminating its retail share class on May 15, 2020. It’s a really solid fund that ought to have drawn more than $9 million in assets.
OLD WINE, NEW BOTTLES
The actively-managed Invesco Global Responsibility Equity Fund (VSQRX), which is really pretty bad at what it does but at least does it with very little money, will become the passively managed Invesco MSCI World SRI Index Fund, effective on or about June 29, 2020.
Effective as of May 1, 2020, the name of the Parnassus Fund (PARNX) will change to the Parnassus Mid Cap Growth Fund. The fund has sagged a good deal since Jerry Dodson stepped away in 2018. There’s already a Parnassus Mid-Cap (PARMX) with a splendid record and manageable asset base. Investors would do well not to mix up the two.
OFF TO THE DUSTBIN OF HISTORY
On July 20, 2020, you’ll lose access to 1290 Convertible Securities Fund, 1290 Global Talents Fund (TNYAX), and 1290 Low Volatility Global Equity Fund.
Effective on June 26, 2020, AllianzGI Micro Cap Fund (GMCAX) and AllianzGI Ultra Micro Cap Fund (AAUPX) will be liquidated and dissolved.
American Century Zero Coupon 2020 Fund (BTTTX) will be liquidated on September 18, 2020.
The Arrow Dogs of the World ETF (DOGS) … hmm, shouldn’t joke about the “dogs” part, eh? Okay, after having trailed 100% of its peers in 2019 and, so far, in 2020, the fund will be liquidated on May 15, 2020. Morningstar’s computer assigned it a “Bronze” rating, which might suggest that it’s time to tweak an algorithm.
On final descent: Ascendant Deep Value Bond Fund (AEQAX) will make a final hard landing on May 22, 2020.
Do you remember the good ol’ days when you were Foster Friess and you wanted to call your fund the Brandywine Fund and so you could call it … oh, the Brandywine Fund? Not so much now. The tiny and sad AMG Managers Brandywine Advisors Mid Cap Growth Fund (BWAFX) will be liquidated on May 15, 2020. The original Brandywine Fund is still around, with a long name and one manager from Friess Associates. Mr. Friess himself has transitioned to a life of conservative activism.
Catalyst Growth of Income Fund (CGGAX) was liquidated on April 30, 2020.
Effective April 24, 2020, the CLS Strategic Global Equity Fund “has ceased operations and is no longer available for purchase.” Frankly, I didn’t even know that it had been in operation.
Core Market Neutral Fund (STTKX/STAKX) will be cored on May 15, 2020.
Cutler Fixed Income Fund (CALFX) and Cutler Emerging Markets Fund (CUTDX) will be liquidated on May 28, 2020.
The Defiance Next Gen Food & Agriculture ETF (DIET) will be liquidated on May 22, 2020. As is painfully common, the fund’s sponsors pulled the plug after less than one year of operations.
The four-star Frost Mid Cap Equity Fund (FAKSX) will be liquidated on June 30, 2020.
Gator Financial Fund (GFFIX) – a $2 million fund with a 34% YTD drop – will sink into the swamp on June 16, 2020.
The Hartford Quality Bond Fund is merging into The Hartford Total Return Bond Fund on July 24, 2020. The merger was originally slated for June 5, 2020. No word on why.
Following shareholder approval (baaaaa!), the $15 million Mainstay Cushing Energy Income Fund (CURAX) will be merged into MainStay CBRE Global Infrastructure Fund (VCRAX).
Miller/Howard Income-Equity Fund (MHIEX) will be liquidated on June 15, 2020.
Effective April 17, 2020, the North Capital Emerging Technology Fund (NCTEX) ceased operations and is no longer available for purchase.
Parametric 1-to-10 Year Laddered Corporate Bond Fund (EACBX) will be liquidated on my birthday, May 29, 2020.
RiskPro PFG Aggressive 30+ Fund, RiskPro Aggressive 30+ Fund, RiskPro Alternative 0-15 Fund, and the RiskPro Dynamic 15-25 Fund will be liquidated on June 30, 2020.
The Second Nature Thematic Growth Fund (CEGSX) was liquidated on short notice (uhh … eight days) on April 30, 2020.
Source Dividend Opportunity ETF (DVOP) was liquidated on April 30, 2020.
Strategy Shares EcoLogical Strategy ETF (HECO) was liquidated two days after the 50th anniversary of Earth Day.
Thomas White Emerging Markets (TWIIX) will be liquidated on March 8, 2020.
The Validea Market Legends ETF (VALX), whose marketing slogan was “Invest Using the Strategies of Market Legends,” will close after five years of trailing its peers and liquidate immediately after the close of business on May 15, 2020.
Ummmm … to be fair, Charles Steadman was a market legend, of sorts.
