Category Archives: Mutual Fund Commentary

Investing Without an Ulcer

By David Snowball

The good news is, in the long term, things will work out okay.

The bad news is that there are a lot of miserable short-terms between now and then. The most successful long-term investments are ones that allow you to endure the short term with a minimum of trauma.

Or drama. (Comedian Anita Renfroe offers, “Difficulty is inevitable. Drama is a choice.”)

Or ulcers. (Philosopher Marilyn Monroe: “If you spend your life competing with businessmen, what do you have? A bank account and ulcers!”)

Ulcers are to be avoided. We have a way. Continue reading →

Investor Life Cycle and Lessons Learned from Past Recessions

By Charles Lynn Bolin

I have made many mistakes investing and am an example that if one reflects upon their mistakes, they can recover. As George Santayana said, “Those who cannot remember the past are condemned to repeat it.”

I received assistance from Murray in writing this article.

In an AAII Newsletter, Warren Buffet’s mentor Benjamin Graham described individual investors as either “Defensive” or “Enterprising/Aggressive” based on how much “intelligent effort” they were willing or able to devote to investing. The Defensive Investor included professionals without much time and young investors without much investing experience.

In this article, I review Continue reading →

Briefly Noted

By TheShadow

Updates

In a “less than meets the eye” kind of way, the headline is “ESG funds lose $5.2 billion in assets in 2023.” The story behind the story: the Republican temper tantrum had led to outflows from BlackRock, whose ESG Aware MSCI USA ETF alone dropped $6.4 billion. In a defensive reaction, BlackRock reduced the ESG allocation in its model portfolios, which Continue reading →

April 1, 2023

By David Snowball

Dear friends,

Chip and I celebrated the start of Spring – or at least Augustana’s spring break – with a long sojourn to New Orleans. Our options were either a series of flights totaling about 10 hours or a 14-hour drive. For better and worse, we chose the latter, loaded the car with snacks, books, and music, and headed down the Mississippi from the Quad Cities to the Big Easy. The drive took us through seven states and one swath of utter destruction. The night before our passing, a tornado in Mississippi decapitated a forest adjacent to Interstate 55. Imagine, if you might, hundreds of mature trees either snapped off five feet above the ground or ripped up by their roots. It was spectacular and a sobering reminder of the price we’ll pay for a heating planet.

We ate well – she more Continue reading →

Bond Funds for a Recession and Falling Rates

By Charles Lynn Bolin

Bond investors think they’ve seen it all.

They are wrong about that. For people who first began investing in bonds within the past 4o years – say, since 1982 – the bond market must seem like a source of perpetual, reassuring, and unrelenting gain. Just chuck some cash into the Treasury market or investment-grade corporates, and voila! Instant wealth.

In that same period, global equity investors have been Continue reading →

Short Term Performance of Long-term Recommendations

By Devesh Shah

The eternal flaw of investment gurus, both on the web and elsewhere, is that they’re never held accountable for their bravado and bold recommendations. It is in the nature of the beast that one right guess lives on forever while an infinite number of horrendous recommendations vanish from the public mind. I think of Elaine Garzarelli, who made her fame from one right call – an impending market crash a week before the actual “Black Monday” crash in 1987 which saw the Dow drop 22% (7300 points in today’s terms) in a day – but somehow dodges rebuke for her Continue reading →

Artisan Developing World Fund interview

By Devesh Shah

An interview with Lewis Kaufman, founding portfolio manager of the Artisan Developing World Fund

My primary investment biases are two-fold. First, in general, I invest in public markets through low-cost, low-turnover passive vehicles. Second, in general, I invest in US equities. Both of those biases were arrived at through a combination of (painful) experience and careful research. That said, none of us benefit from being held hostage by our beliefs. In many ways, humility and self-doubt, curiosity, and the determination to keep learning are the hallmarks of our wisest citizens. And I aspire to learn from them. In consequence, I’ve spent a huge amount of time over the past six months talking with a cadre of the industry’s best emerging markets managers.

Home Bias

Investors worldwide have a powerful bias Continue reading →

The Tide Is Going Out

By David Snowball

“It’s like the tide going out; you’re starting to see all the things that have been waiting to happen,” David Sherman of Cohanzick Management, 15 March 2023 web call summary.

David Sherman is one of the industry’s most consistently successful fixed-income investors. He founded Cohanzick Management on the premise “return of capital is more important than return on capital.” His specialty is the pursuit of distinctive, low-risk diversifying strategies for fixed-income investors. “We try to focus on what we know and what we do well. We do not pursue investment ideas or strategies that are Continue reading →

Briefly Noted…

By TheShadow

Updates

Vanguard launched its Short-Term Tax-Exempt Bond ETF on March 9th. The ETF will optimize tax efficiency for investors seeking to allocate to the shorter end of the municipal bond market. It predominantly invests in short-term investment grade municipal bonds and will track the S&P 0-7 Year National AMT-Free Municipal Bond Index. It has an expense ratio of Continue reading →

March 1, 2023

By David Snowball

Dear friends,

Welcome to Spring. Some diehards erroneously insist that they’re “officially” winter-bound until the Spring equinox, March 20th this year. It need not be so.

There are two springs. Meteorological spring, which is aligned with temperatures and growing seasons, is March 1st. Astronomical spring, which is aligned with the wobble of the earth on its axis (called “precession”), begins with the Continue reading →

Looking Beyond 2023 Investing – Lies and Statistics

By Charles Lynn Bolin

Mark Twain wrote in 1907, “There are three kinds of lies: lies, damned lies, and statistics.” The differences in opinion about soft or hard landings center on how trends are measured, data accuracy, revisions, seasonal adjustments, and which data to follow. I provide Chart #3 of what I am monitoring over the next six months as the story about soft or hard landings unfolds. Continue reading →

Interview with Amit Wadhwaney: Co-Founder and Portfolio Manager, Moerus Capital Management

By Devesh Shah

Recently, I had a long chat with Amit Wadhwaney, the founder of Moerus Capital Management and the adviser to Moerus Worldwide Value Fund. He is a very thoughtful and seasoned investor. Here are some of his thoughts on his fund and his stock-picking style. I’ve presented a summary of my notes rather than an actual Q&A, but the flavor of their investing style will hopefully come through. Continue reading →

Just short of two cheers for active, international investing

By Devesh Shah

Readers know that I long ago concluded that active management rarely adds value to an investor’s portfolio. There are too many managers fighting over the same stocks. Very few of them have a meaningful Edge over the others. Most of those who add some value rarely add enough to overcome the drag imposed by their expenses and higher tax burden. Some few add serious value, but they are almost impossible to reliably identify in advance.

That said, I am about to commit two heresies in one column: I will suggest that you consider Continue reading →

To Sell or Not to Sell? (REMIX, PQTAX, GPANX, COTZX)

By Charles Lynn Bolin

This is my annual assessment of the funds that I own and whether it makes sense to hold them with my annual outlook, as described in this month’s companion article. My outlook is “Risk Off” because of economic uncertainty, plus bonds are now paying an attractive yield. The funds assessed in this article exclude bond funds, individual stock, and American Century Advantis All Equity Markets (AVGE). As interest rates rose and stocks and bonds fell, I gradually sold my most volatile funds and bought short-term ladders of certificates of deposit and Treasuries to lock in higher yields. With interest rates higher, I now ask myself, would I rather own my remaining funds in my intermediate buckets or make four or five percent in safer investments? That is the question.

I use the “Bucket Approach” and have Fidelity Wealth Management manage my longer-term portfolios, which collectively resemble Continue reading →

Briefly Noted

By TheShadow

Updates

Ariel Funds picks up a new team and two new strategies. Henry Mallari-D’Auria, previously the CIO of emerging markets value at AllianceBernstein, will join the firm in April. Four of his colleagues have moved with him, and they have plans to build the team out more. Ariel’s co-CEOs note that “a dedicated EM strategy became our next natural product extension.”

In addition, Ariel intends a most un-Ariel move in launching a global long/short strategy led by Micky Jagirdar, who is already the firm’s head of global equities.

Driehaus Funds has filed an SEC registration filing for Continue reading →

February 1, 2023

By David Snowball

Dear friends,

Welcome to February. It’s a month we associate with love, St. Valentine’s Day. As holidays go, it’s another triumph for the marketers. The holiday began life as a Roman fertility festival, Lupercalia, and its attendant parties. Eventually, the Christian church made the same move here as they did with the pagan year-end festival; they repurposed the December solstice festival into Christmas and the February fertility festival into St. Valentine’s Day. The moves gave them one more tool for converting party-loving pagans into … well, party-loving Continue reading →

One of a Kind: American Century Avantis All Equity Markets ETF (AVGE)

By Charles Lynn Bolin

My last article on Seeking Alpha suggested that value, international, small caps, and emerging markets would outperform over the coming years. David Snowball wrote “The Investor’s Guide to 2023: Three Opportunities to Move Toward” last month along the same lines and offers his insight into these asset classes along with some excellent funds. I follow the Bucket Approach, where some Buckets have similarities to Dr. Snowball’s “Terrified Investor,” “Exhausted Investor,” or “Enterprising Investor.” A Reader on Seeking Alpha asked my opinion about Continue reading →

Richard Cook, “Where there’s mystery, there’s margin”

By David Snowball

I’m a sucker for an intriguing headline, and CityWire’s John Coumarianos came up with a doozy: “EM managers had (another) year to forget. But one fund defied the gloom” (1/9/2023). The triumphant reveal was:

only one out of the 816 funds in the Morningstar Diversified Emerging Markets category with a 2022 track record posted a positive number. That was the relatively unknown Cook & Bynum fund (COBYX), which returned 9.29%. Continue reading →