Many Marketfield Investors Say Enough

Ted

FYI: When do you give up on a poorly performing fund?
This is a thorny question facing investors of the $9 billion MainStay Marketfield fund, a hedge-fund-like mutual fund that fell behind its peers and the broad stock market for the past five quarters. The fund slid 12% last year, whereas its typical peer gained around 3% and the S&P 500 index rose 11.4%, according to Morningstar Inc.
“The performance has just been horrendous,” says Owen Murray, an investment adviser in Houston who sold the fund last year.
Regards,
Ted
http://www.wsj.com/articles/many-mainstay-marketfield-investors-say-enough-1423454473?tesla=y

Old_Skeet

This was a great fund before MainStay bought it and one that I owned. A fund such as this needs to be nimble where it can reposition to the current ever changing investment macro themes in short order. MainStay grew the fund to such a large size that it lost flexability to effectively position ... and, with this, I sold it last summer.

If a dog can hunt its a keeper for a hunting dog. This dog lost its ability to hunt; and, I did not need another pet ... so, I sold it.

Old_Skeet

hank

Don't know who's driving the car there but think I could do it better (which ain't saying much:).

Off .44% today. Why?

Stocks were down. I suspect, they're short the S&P.
Oil and gold were both up. I suspect, they're long these.
Looks like the Dollar and domestic bonds moved little.

If above is accurate, than this fund should have been up today.
Guess I just don't get it.
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Other funds I watch - HSGFX and HSTRX were both up slightly. BEARX closed unchanged.

Shostakovich

Never, I mean never, would have seen this coming. Wonderful fund, star managers often in the press, white-hot money piling in, fund taken over by a financial institution. You mean, there was the possibility of bloat and underperformance?

Never, I mean never saw that coming.

BobC

We owned this fund from almost its beginning, given Aronstein's track record and his innate sense of global macro themes. It did what we expected of it through third quarter of 2013, then it just went off the tracks. Aronstein admits they did not control their risk parameters. The fund was often early on its calls, but they were almost always proven right. Hard to put a finger on exactly what happened, but it is hard to overlook the takeover by Mainstay and the nearly quadrupling of assets from 2012-2013, driven by brokerage houses quick to jump on a hot fund. Given the kinds of macro themes the fund targeted, it seems that it would be difficult to employ cash in a fund that went from $882 million in 2011, to $4 billion in 2012, to almost $16 billion in 2013. Of course that is no longer a problem with the funds assets at $6 billion and dropping. Fortunately, most of our accounts in MFLDX were long-time and had some very nice gains. Notice I say HAD. After extensive reviews, including listening to management, we decided our original thesis for owning the fund was no longer valid. The fund is certainly capable of turning things around, but it no longer fit our risk parameters. Seldom have I seen a great fund implode quite like this one, but I have to wonder if performance would have been different had the fund remained independent.

scott

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