Virtus And Newfound Hit The Market With Alternative Income Funds

Ted

FYI: With interest rates at historic lows for a number of years, and the specter of a rate hike on the imminent horizon, fixed-income investors may face a difficult road ahead. Traditional strategies are unlikely to work, which is why it’s fortunate that investors now have access to a wide range of products that generate income from non-traditional sources. On September 9, a total of three alternative fixed-income mutual funds were launched: one by Virtus Investment Partners, and a pair by Boston-based Newfound Research.
Regards,
Ted
http://dailyalts.com/virtus-newfound-hit-market-alternative-income-funds/

Old_Skeet

Ted thanks for posting this. I have put this fund on my watch list and plan to study it in more detail. I have found through the years that Virtus has some fine funds. This new product does look interesting.

I have linked its fact sheet below.

https://www.virtus.com/vsitemanager/Upload/Docs/FS_Strategic_Income_1100.pdf

heezsafe

re. VASBX
FEL= a mere 3.75%
Contingent deferred sales charge= 0.50%, 18 frigin' months?(uh, I don't think so)
e.r.= 1.41% ["gross" expenses of 2.12%... indeed]

It's The Aston Way, writ large.
No thank you very much.... I'll pass.

@Old_Skeet What has happened to your standards? Deplorable!

JohnChisum

These funds will primarily invest in ETFs and ETNs. For that kind of expense why not invest directly into the ETF?

C&P. No thanks.

rjb112

https://www.virtus.com/individual-investors/mutual-fund-details?id=8564#tab_performance

The dreaded LOAD word.....



2.12% annual expense ratio for an income fund? Is that acceptable, when the yield on the 10-year Treasury is only 2.6%?
OK, it got lowered to 1.41%, but for how long? Is that just a temporary expense waiver that brought it from 2.12% to 1.41%, or something else?

Old_Skeet

Folks, its on my watch list ... and, at this point in time I am just looking as I have it under review. This might be like Marketfield ... a good performer while it was a relative small fund but when it got sold to New York Life well it seemed to lose its mojo due to asset bloat.

I will be tracking it against the three strategic income funds that I already own TSIAX, NEFZX, EVBAX and then their own multi sector income fund NAMFX. My son holds NARAX in his Roth IRA and it has been a good performer in his short term bond fund slot. VIRTUS does have some good funds ... Let's see if its performance will warrant owning it. Not sure at this point. Just looking.

Old_Skeet

rjb112

Whatever you do, don't buy the Class C shares. Those poor folks obviously don't know what they are getting into. See below:



Hmmm......I think I'll buy a fixed income fund with an annual expense ratio of 2.87%.
Sounds like a great idea.

Oops, forgot, they temporarily lowered the expense for the Class C shares from 2.87% to 2.16%. Much better deal.

These people should be arrested. For crimes committed against Class C shareholders. And they are not very nice to their Class A shareholders either.

heezsafe

Some people are math-challenged and there is jis no fixin' (yet, dang it, some end up doing o.k., regardless).

Old_Skeet

Let's say its manager provides stellar performance and the fund's performance results put it at the top of its class then certainly the fees and sales load are better warranted. After all, hedge funds usually charge 2&20 plus impose a lock up period. This fund has a lock up, of sorts, by imposing a deferred sales charge for those that want to cut and run and to also prevent it from becoming a trading vehicle within their family of funds through nav exchanges. It may well be its fees outstrip any out sized performance. We shall see. I plan to watch it for a good year like I did with Kathleen Gaffney's fund (EVBAX) when she left Loomis Sayles for Eaton Vance. Thus far, her fund has produced stellar returns and I recently purchased it.

And, I look for those fund companies that bring forward hedge fund type mutual fund products to be those with the higher fees associated with them because of the added cost to carry out certain investment strategies used by many hedge funds.

I have it on my watch list as I think it is an interesting fund. Now whether I tuck it into one of my portfolio's investment sleeves is another matter as I wait to see its performance. It is probably to aggressive to become a member of my income sleeve so that leaves my hybrid income sleeve and my specialty sleeve for a possible fit.

Like I said, show me stellar performance and it might very well become a member of one of my investment sleeves. Again, and for right now, I am just looking at not only this fund but some other interesting funds as well. I remember some knocking Ms. Gaffney's fund because of its sales load. They'd probally gladly pay the sales load now after seeing its performance. And, if you are first knocking this fund because of its sales load and the fees associated with it then it is probally not right for you.

mzckf

Virtus has lanuched 3 alternative funds early this year, here is the link list: http://dailyalts.com/company/virtus/

Here is the Virtus alternative funds website: http://virtusalts.com/