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Legal Troubles at Double Line Funds?

PSA
edited April 2011 in Fund Discussions
I'm thinking of buying I shares of DBLTX. Comments would be appreciated.

Comments

  • As far as i know, most of the legal trouble has past. I know TCW still has a suit outstanding, but this reeks of a fund company wanting their stud manager back. DBLTX is currently the only core bond fund we use (the others being TGBAX or the total return version, and LSBDX).
  • I read a while back, but have seen nothing lately on it, that the lawsuit is about Gundlach's making off with a bunch of information TCW considered proprietary, and it isn't settled yet. I have no idea whether that's something to be concerned about as a potential DBL investor.
  • PSA, make sure you compare the DBLTX Total Return fund and the DBLFX, "Core" bond fund. You may already have done so and know that the Total Return is what you want, but beware that Total Return is concentrated in Mortgage fixed income securities (~84% of holdings). This may not be a bad thing, just pointing it out. From what I've read, mortgage securities is Gunlach's expertize. The Core fund is more diversified and even holds some foriegn government fixed income. Total Return does not.
  • MikeM is right, they are heavily invested in MBS', but that is Gundlachs sweet spot, just look at the historic holdings of TCW total return.
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