Author Archives: David Snowball

About David Snowball

David Snowball, PhD (Massachusetts). Cofounder, lead writer. David is a Professor of Communication Studies at Augustana College, Rock Island, Illinois, a nationally-recognized college of the liberal arts and sciences, founded in 1860. For a quarter century, David competed in academic debate and coached college debate teams to over 1500 individual victories and 50 tournament championships. When he retired from that research-intensive endeavor, his interest turned to researching fund investing and fund communication strategies. He served as the closing moderator of Brill’s Mutual Funds Interactive (a Forbes “Best of the Web” site), was the Senior Fund Analyst at FundAlarm and author of over 120 fund profiles.

Time to take out the trash: 25 huge funds with serious questions

By David Snowball

It is unfair and irrational to judge a fund solely on its total returns, much less on whether it has managed to “beat the market” lately. The former concern ignores a long series of important questions, the most important of which is “how much risk does the strategy expose you to in exchange for those returns?” Many would argue that receiving 20% of the market’s gains is great if you bear only 10% of its risk, and that’s what you signed up for in the first place.

The latter concern is simply lunatic. Rational people do not invest with the goal of beating the market. Rational people invest with the goal of ending up with resources that match or exceed their needs. If you beat the market ten years straight and your resources are less than your needs, you have lost. If you trail the market ten years straight and your resources exceed your needs, you have won. Continue reading →

Launch Alert: CrossingBridge Pre-Merger SPAC ETF

By David Snowball

On September 17, 2021, CrossingBridge Advisors, LLC, launched their actively managed Pre-Merger SPAC ETF (SPC). CrossingBridge, primarily an institutional/high net worth advisor located in Pleasantville, New York, has approximately $970 million in assets under management and is responsible for the CrossingBridge Low Duration High Yield, CrossingBridge Ultra-Short Duration, and the CrossingBridge Responsible Credit funds.

While the buzz surrounding SPACs is that they are a high-risk, get-rich-quick scheme, the CrossingBridge fund is Continue reading →

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 33 new products into the pipeline, most of which will launch by the end of late November.

French historian Jean Francois Marmontel (1723-99) coined, and the American agitator Thomas Paine (in The Age of Reason, 1793) popularized, the phrase “from the ridiculous to the sublime.” This month’s offerings perfectly capture that sentiment, ranging at they do from a bunch of marketing confections destined for Continue reading →

Briefly Noted…

By David Snowball

Updates

And the beat goes on. Five more mutual funds are becoming ETFs. On October 22, 2021, the Adaptive Fundamental Growth Fund, Adaptive Hedged High Income Fund, Adaptive Hedged Multi-Asset Income Fund, Adaptive Tactical Outlook Fund, and Adaptive Tactical Rotation Fund will be converted into the AI Quality Growth ETF, Adaptive High Income ETF, RH Hedged Multi-Asset Income ETF, RH Tactical Outlook ETF, and RH Tactical Rotation ETF, respectively. While the names and structure change, the investment strategies do not.

DFA is dancing to that very beat. Two more active DFA mutual funds have converted to ETFs: Dimensional International value ETF (DIV) and Dimensional DFA World ex US Core Equity 2 ETF (DFAX). That brings the DFA tally to Continue reading →

September 1, 2021

By David Snowball

Dear friends,

It’s fall! We’re back! And we hope you are, too.

Well, it’s “meteorological fall” anyway. “Astronomical fall” (or is it “anatomical fall”? I can’t recall) holds off until September 22. With two classrooms full of students (one studying Propaganda with me, the other Advertising and Consumer Culture), my brain assures Continue reading →

Launch Alert: Virtus KAR Small-Mid Cap Value

By David Snowball

On August 3, 2021, Virtus Partners launched their latest collaboration with Kayne, Anderson, Rudnick (KAR), Virtus KAR Small-Mid Cap Value. The fund is managed by the KAR of the title: Kayne, Anderson Rudnick Investment Management, Virtus’s largest wholly-owned subsidiary. KAR, based in Los Angeles, manages rather more than $17 billion in assets.

Across all of their portfolios, KAR emphasizes Continue reading →

Harbor International Small Cap (HIISX / HNISX), September 2021

By David Snowball

Objective and strategy

Harbor International Small Cap Fund pursues long-term growth by investing in a diversified portfolio of international small-cap stocks. They have three particular preferences:

  1. demonstrate traditional value metrics primarily on a price to book, price to earnings, and/or dividend yield basis;
  2. well-capitalized and transparent balance sheets and funding sources; and
  3. business models that are undervalued by the market.

Up to 15% of Continue reading →

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 50 new products in the pipeline, most of which will launch by the end of October. The recent record, though, is that many authorized products are being Continue reading →

Briefly Noted

By David Snowball

Updates

Effective immediately, Neuberger Berman Commodity Strategy Fund‘s investment strategy will permit the fund to invest up to 5% of its assets in cryptocurrency investments through bitcoin futures and investments in the securities of exchange-traded funds organized and listed for trading in Canada to gain indirect exposure to bitcoin.

WisdomTree Cloud Computing Fund, an active ETF, now solemnly swears not to invest in … you know, weapons systems, coal, or tobacco. In short, it’s declared itself to be Continue reading →

August 1, 2021

By David Snowball

Dear friends,

As we announced in June, the Observer is on hiatus for the month of August.

Hmmm … you know, it’s gone fishin’.

Disconnected.

Chillaxin’.

This is my first scheduled break from publishing in 25 years, and Chip’s first in nearly a decade. We took the opportunity for our first out-of-town trip – back to Chip’s native state of New York – in 18 months. We celebrated the marriage of Chip’s son David (in the company of her father, David) on the 17th and spent a bit of time with her Continue reading →

Launch Alert: T. Rowe Price Retirement Blend Funds

By David Snowball

On July 28, 2021, T. Rowe Price launched its fourth set of target-date funds, the Retirement Blend Series. The Retirement Blend strategy has been in operation since 2018 but has been available only through collective investment trusts. The new fund series complements the existing Retirement and Target Series (as well as the Retirement Hybrid series that’s available only through a collective investment trust). All four series invest, primarily, in other T. Rowe Price funds. Retirement and Target invest, primarily but not Continue reading →

July 1, 2021

By David Snowball

Welcome to July, dear friends.

It’s summertime, an especially blessed and cursed interval for those of us who teach. On the one hand, we’re mostly freed from the day-to-day obligation to be in the classroom. Some of us write, some travel, some joke about “going topless at the beach” which translates to leaving their masks at home, some undertake “such other duties as may from time to time be assigned” by our colleges. On the other hand, we hear the clock ticking. All year long, as we try to face down a stack of 32 variably literate essays at 11 p.m. Sunday night, we think “if I can just make it to summer, I’ll recharge and it’ll be great!” About the first thing we notice when summer does arrive, is that summer is almost Continue reading →

Launch Alert: First Eagle Small Cap Opportunity Fund

By David Snowball

On July 1, 2021, First Eagle Investment Management launched the First Eagle Small Cap Opportunity Fund (FESAX / FESCX / FESRX). The investable universe is primarily domestic small- and micro-cap value stocks. In general, they’ll own 180 – 300 of them.

The fund pursues an opportunistic small-cap value strategy, investing in companies that the portfolio management team believes to be attractively valued and have the potential to benefit from a catalyst—such as new management, a more favorable business cycle, product innovation and/or margin improvement—for a recovery in earnings growth. Small caps are very sensitive to asset flows and even small changes in underlying economic conditions, as a result, Continue reading →

Launch Alert: AMG Yacktman Global

By David Snowball

On July 1, 2021, AMG Funds and Yacktman Asset Management launched the AMG Yacktman Global Fund (YFSNX).

Sort of.

In reality, Yacktman chose to dump the least attractive name in their stable – AMG Yacktman Focused Fund – Security Selection Only – in favor of the simple “Global” moniker. Yacktman manages two of the most outstanding funds in excellent: Yacktman (five stars, Silver-rated, Great Owl, multi-million dollar investment by the lead managers, top 2% returns over 15 years) and Yacktman Focused (five stars, Silver-rated, Great Owl, multi-million dollar investment by the lead managers, top 1% returns over 15 years). Yacktman Global uses the exact same security selection process Continue reading →

Launch Alert: Semper Brentview Dividend Growth Equity

By David Snowball

On June 1, 2021, Semper Capital Management (semper as in “semper fidelis”) launched Semper Brentview Dividend Growth Equity Fund (SEMBX) in partnership with Brentview Investment Management. Both are minority-owned advisers, with Semper being veteran-owned as well. Brentview has an AUM of $175 million, so they’re a capable firm. They intend to provide both a high level of risk-adjusted current income and the prospect of capital growth.

The fund is currently available only to Continue reading →

Channel Short Duration Income Fund (CPSIX), July 2021

By David Snowball

Objective and strategy

Channel Short Duration Income Fund pursues total return, comprised of both income and capital appreciation. In general, at least 65% of the portfolio will be investment-grade securities and up to 35% might be high-yield bonds. The bulk of the portfolio is short-term investment-grade debt, but the manager can opportunistically add other securities – longer-term debt, for instance – so long as the portfolio as a whole maintains a weighted average duration of 1 to 3.5 years.

The adviser expects the portfolio to be Continue reading →

Appleseed Fund (APPLX), July 2021

By David Snowball

Objective and strategy

The Appleseed Fund seeks long-term capital appreciation. They do that through a portfolio that combines a global, all-cap portfolio of undervalued equities with other diversifying, and sometimes defensive, assets. Its investable universe centers on companies that have “sustainable competitive positions, solid financials, and capable, shareholder-friendly management teams.” The “other assets” in the fund might include bonds (though it currently does not), convertible securities, ETFs, commodities, REITs, and other real estate entities, currencies, and cryptocurrencies. Finally, they use Continue reading →

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 36 new products in the pipeline, most of which will launch by Continue reading →

Briefly Noted

By David Snowball

Updates

AMG River Road Long-Short is no more. At an as-yet-unspecified date following the inevitable shareholder approval, the $20 million / four-star AMG River Road Long-Short Fund will be wiped away, with its regulatory paperwork giving rise to AMG River Road International Value Equity Fund. Its portfolio (which has only 5% international equity exposure) will be liquidated and replaced with a new all-cap, absolute value portfolio. The new managers will be Continue reading →