M*, Day 1: Kunal Kapoor on Morningstar's devotion to investors The conference began with a welcome from former fund analyst Kunal Kapoor, who is now director of information products and client solutions. This year, as last, I found the intro somewhere between disingenous and creepy because it starts with the declaration that Morningstar is driven by it's desire to serve investors. Uhh, no. As a publicly traded entity, it has a fiduciary obligation to maximize return to its shareholders; if maximizing the firm's returns also benefits investors, so much the better. Regardless of where Morningstar started, that's where they are now: a multinational conglomerate behold to its shareholders and bolstered by a taste for acquisitions.
Three focuses for Morningstar's efforts currently: they're working to (1) provide advisors with deeper and broader research (they've rechristened their "mutual fund research team" as their "manager research team" because advisors care less about the package than what's in it), (2) to help advisors improve their operational efficiency and (3) to "help manage changing client dynamics." That latter point reflects a massive data aggregation effort, so that advisors will not only be able to analyze the assets that a client has given them but also all of the other assets the client has anywhere. Last year's promise of devoting additional resources of small and emerging managers is scarcely evident; this year's "emerging managers" panel focuses on the likes of Bernard Horn of Polaris Global Value (PGVFX) who has $300 million in assets and who has been running the fund since 1998. The implied judgment - "if you do stellar work for 15 or 16 years, you'll begin to reach the threshold of 'vaguely interesting' for us" - is not affirming. (To be fair, M* initiated analyst coverage when the fund was just seven years old but it's hard to reconcile the "emerging" label with the manager's tenure."
I'm sure that and Google Glass are both good things, but I'm comfortable with neither.
For what it's worth,
David
Unconstrained Bond Funds Are Constraining Investors
Very nice to know. Thanks
Unconstrained Bond Funds Are Constraining Investors
Unconstrained Bond Funds Are Constraining Investors The fund that I bought several months ago and consider an "unconstrained" bond fund is EVBAX - Kathleen Gaffney's fund. It's done gangbusters since it opened.
I wanted to get into Kathleen Gaffney's fund.
But it's got the "Dreaded Load". A load of 4.7
5%
That kept me away. Also I prefer an expense ratio lower than .9
5% for a bond fund.
questions for the Morningstar interviews Ask all these guys the same question. How much of THEIR fund would they have in a an asset allocation................ How much do THEY have in their fund relative to their net worth? Thanks.
I think that's a VERY important question that all fund managers should have to report. Currently they report within a range. For example, they report that they have between $
500K and $1 million in their fund, or less than $100K, or whatever ranges they have to report.
They need to change the reporting requirements so they are more meaningful. If a stock mutual fund manager has 1 Million in his fund, but has $
50 million in investment assets, that's not what I call "skin in the game." It's only 2% of his investments.......
I like what Longleaf Partners Funds does. They do not allow employees to have outside investments. So the fund managers have ALL their investment dollars in the funds.
It's what Warren Buffett does with Berkshire Hathaway. It's what Bruce Berkowitz does with the Fairholme Funds. It should be the standard. If the fund manager doesn't have a large percentage of his net worth in his fund.........well, then he shouldn't be running the fund.
Just my opinion
questions for the Morningstar interviews Ask all these guys the same question. How much of THEIR fund would they have in a an asset allocation for at 40-50yo or 70yo with a 60/40 stock bond AA. Ask how much is to much? How much do THEY have in their fund relative to their net worth? Thanks.
questions for the Morningstar interviews
Love the Never Never Index, but Open Table got bought by Priceline, which I totally don't understand. To me, Open Table just feels like someone else could come along and invade that space. Even the website is kind of....blah. It's not slick or interesting.
Thanks David.
For the Arbitrage Fund crew.....don't know how you would ask this....but the fund seems to be 'dead in the water' with respect to performance. Not a happy shareholder. Their 2013 total return: 0.85%. 2012 return: 0.27%. No complaints about 2011. 2010: 1.44%. Not focusing on the category, but on an absolute return basis, can't they do better?
I wouldn't expect anything more than low-to-mid single digit returns from Merger Arb funds. May be worse lately from the standpoint of you have traditionally the idea of shorting the company buying and buying the company being bought. In this market, everything is going up. So, while you may get some minor gains from the company being bought, you're losing if the company doing the buying that you're short goes up anyways.
Again though, not going to be something that does more than a single or - in a really good year - a double.
questions for the Morningstar interviews Agree with Dave. I didn't realize RP does commentary; haven't found any on the site.
One amusing bit from the semi-annual report, which is basically the 3-31-14 listing of holdings: RSIIX-RSIVX lists 5.2% in energy, among which is Checkers Drive-In Restaurants. What of the "burgers, fries, cola, wings, fish, hot dogs, the Big Chicken and more," I wonder, packs the most energy?
The Closing Bell: S&P 500 Closes At 20th Record This Year
MDY and IJH etf activity yesterday Does anyone know why the volume on these 2 mid-cap ETFs spiked yesterday so substantially? MDY was 5X average volume and I believe IJH was in the similar volume activity? I could not find any reason for it as MDY has had very low trading volumes recently.
Thank you.
A single-silo credit allocator? In crisis, the Fed may swing the exit gate shut on you Many (most?) people who use MFs for fixed-income investing do so in diversified vehicles that to a greater or lesser extent are also multi-sector. There are also some who are more contrarian, who rotate successfully/opportunistically from one fixed-income asset class to another, as good value arises from dislocations. Some do both.
This blog briefly notes the positives of both, in the context of how each approach could be impacted by measures the Fed Reserve is "considering" as part of a financial crisis action plan:
http://blog.alliancebernstein.com/index.php/2014/06/17/multisector-plan-can-help-avoid-the-crowd-in-credit/You see, according to the Fed
trial balloon leakthinking, under dire circumstances, retail investors in some transparent, open-end mutual funds might stampede for the exits in large sector-specific funds (the horror!); the degree to which this
spasmic disorder would threaten the banking system of the country is
so unpredictable, yet similar in impact to what one might expect to come from the
"shadow banking system," that one should create contigency plans for a run on these funds
as if they are part of the
"shadow banking system." At least that's the way I'm interpreting what I've read here and elsewhere about this
contrivance discussion:
http://www.ft.com/intl/cms/s/0/290ed010-f567-11e3-91a8-00144feabdc0.html?siteedition=intl#axzz34uHmImp0See what you think, esp. you
dangerous single-silo credit allocators.
M* CEF Weekly Update
What do you think about these funds? Thanks, Crash!
I took a look….two (2) things at $20 billion too big and it’s going to close. YAFFX just closed hard! It has $8.5 billion….I do like MAPOX on my short buy list on pullback.
Yes, Ron, sometimes I do this too much. My wife says this too…..and about other things, too. So I say, “Sweetie, want to have sex (lol!)?” That ends that discussion. I’ve learned a lot over the years being married.
The Puddn
Top Midcap Funds Of 15 Years Spotty Year-To-Date OJ, thanks; missed that. If you pay a whopping load you can get in for the usual small amount. And then your results will be much worse than FLPSX. Oh, wait, it's also closed. It also has lagged its Russell MCV index for 1/5/10y, huh? Guess I be stickin' with Tillinghast.
