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"Mr. Gundlach will be discussing the markets and his outlook for what he believes may be the best investment strategies and sector allocations for 2012."
The CNBC interview has misleading fact on why the fund does not have stars assigned by M*. The fund did not have enough history for star rating to be assigned.
Yet, CNBC interviewer (Gary Kaminsky) is claiming that it does not have star rating because it does active management and does not fit to a style box. BS! There is already a category for these funds. That is not the problem.
But I expected Gundluch to correctly point to why his funds does not yet have star ratings but was not honest to point that his current fund is new and he could not use prior record which otherwise would most likely get 5-star rating.
Per the category issue, M* has DBLTX/DLTNX as a regular ol' intermediate bond fund, which it decidedly isn't, but it doesn't fit in multi-sector bond either (because it sure isn't multi!). I guess they could call it high-yield, and it would be super-duper gold-platinum-rubies-diamonds low-risk, high-return in that category. But if they had something like a core-plus or specialty bond category, it would make a lot more sense there and not look so odd in a category where it doesn't belong.
If you read the M* analysis, they fall back on a fit-in-the-category criterion to say it's too risky for a high rating, rather than doing a real assessment of the risk per his strategy. Pretty lazy analysis ...
Reply to @AndyJ: It does not matter. The matter of not having a star rating of any sort is nothing got to the with how the fund invests. Sure the category and active management etc. are valid discussions but not for the existence of the star rating. It will have a star rating when it is 3 years old. It could be argued that the star rating is probably incorrect based on invalid comparisons but that will come in a couple of years.
Reply to @Investor: Hi Investor, my post wasn't about star ratings; as you say, there is no star rating on it. The point I was trying to make, maybe not that eloquently, is that they used their miscategorization of the fund (which is partly a product of the limited bond fund categories they recognize) to wave it off with a "too risky for category" rationale rather than actually drilling into the holdings and strategy to assess it qualitatively. I was addressing the existing analyst report, not a star rating.
Comments
http://doublelinecapitallp.com/view.php/825777/53820
"Mr. Gundlach will be discussing the markets and his outlook for what he believes may be the best investment strategies and sector allocations for 2012."
http://www.pionline.com/article/20120104/CHARTOFDAY/120109981/doublelines-flagship-bond-fund-returns-more-than-double-tcws-in-2011
Yet, CNBC interviewer (Gary Kaminsky) is claiming that it does not have star rating because it does active management and does not fit to a style box. BS! There is already a category for these funds. That is not the problem.
But I expected Gundluch to correctly point to why his funds does not yet have star ratings but was not honest to point that his current fund is new and he could not use prior record which otherwise would most likely get 5-star rating.
In addition, he is also avoiding mentioning his prior performance record as part of the lawsuit settlement with his former employer, TCW.
If you read the M* analysis, they fall back on a fit-in-the-category criterion to say it's too risky for a high rating, rather than doing a real assessment of the risk per his strategy. Pretty lazy analysis ...