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Happy Anniversary to us! April commentary and updates have been posted

Dear friends,

We're celebrating our first anniversary - our 65,000th visitor and quarter-millionth visit - this month.

Arguable highlights to the April commentary includes

- A skeptical look at whether you really want anything "Permanent" in your Portfolio, with a comparison of the actual portfolios of three "permanent" products

- A launch alert for two new RiverPark Funds, Gargoyle Hedged Value Fund and Long/Short Opportunity. The former will actually launch May 1, the latter is available on Monday. Both have interesting strategies and solid records as hedge funds. Given RiverPark’s success bringing other institutional and hedge fund managers to “the mass affluent,” these two funds warrant attention.

- Speaking of attention, Gary Black – the president of Janus famous for going to war with their elite portfolio managers (15 left) and losing a multi-million dollar lawsuit – has filed to launch his own long/short fund, which we note in “Funds in Registration.”

- A profile of Litman Gregory Masters Alternative Strategies (MASNX) – which brings four teams with exceptional track records together in what’s likely to be one of the “multi-alternative” universe’s strongest offerings.

- A profile of Tribuntary Balanced, Institutional (FOBAX), a former bank fund with a misleading name (Institutional belies its $1000 investment minimum), flexible strategy and unmatched risk/reward profile. This profile was actually suggested by one of the folks on the board.

- And a follow-up on FundReveal, in which the founders address a couple of your most pressing questions and we unveil a bit of a partnership with them.

And our "The Best of the Web" feature highlights cool and informative podcasts, including four serious "weekday" and three lighter "weekend" ones (Junior has me pegged as a three-day weekend guy and had me do those three) plus first word of Chuck Jaffe’s return to the airwaves

Thought you'd like to know,

David

Comments

  • Thank you, David.

    I'm not in charge of breakfast at this house, this Sunday morning. The wife and daughter will likely know why I have slept in a bit after the sun has risen.

    Regards,
    Catch
  • Happy anniversary MFO, so glad you are going strong!
  • edited April 2012
    Happy birthday MFO! Most interesting Commentary! I am definitely going to follow MASNX.

    I have a question/comment about FOBAX. When I compared it to OAKBX since inception (1996), I found that $10 invested in FOBAX in 1996 since that time became $27.48, which is not bad, but the same amount invested in OAKBX became $50.41, and this result was achieved by OAKBX with low risk and with much greater consistency compared to FOBAX, which did not grow at all from 1997 to 2002. During the last 5 years FOBAX achieved slightly better results, but OAKBX did it with smaller risk (plunged much less in 2008).
  • may MFO lives another 200 yrs:)
  • Hi, andrei!

    Because of the fund's transitions in management (the manager joined in 10/06) and function (from a sort of in-house bank fund to a somewhat less conservative one), I I tried to focus a little less on the 10-year and longer record than on the five year one. Over five years, FOBAX and OAKBX are in a dead heat in terms of returns. OAKBX is the less volatile of the two but has a far weaker three-year (i.e., upmarket) record.

    I would imagine, going forward, that OAKBX will be the steadier fund. The mere fact that it's hauling $20 billion limits the opportunity to get frisky. Mr. Studzinski retired last year, leaving Mr. McGregor alone at the helm. I'm not entirely sure that that's ideal. Mr. McGregor himself is about 60, so I wouldn't expect him to be leaving soon and he might get a formal co-manager at some point.

    Bottom line: It's hard to imagine better mainstream choices that Vanguard STAR, Vanguard Balanced Index, or Oakmark Equity & Income. What Tributary offers is a slightly different, slightly more flexible take on portfolio construction, coupled with pretty good evidence that the guys can pull it off.

    Hope that helps,

    David
  • David and andrei - I checked on that as well after reading David's discussion and see no compelling reason to change. However, I was looking for one because of the 3-yr OAKBX downdraft that David mentioned. I have been putting new mutual fund money into TIBIX during this time period partly because of that reason.
  • Reply to @David_Snowball: I think it may be useful to compare FOBAX to GLRBX. GLRBX is much more tame and may lag in strong bull markets but it provides better downside protection.
  • Happy Anniversary David and Mutual Fund Observer. Thanks for finding us, mutual fund investors a new home to gather.
  • Reply to @Investor: I was sitting today at the James Advantage funds website, studying their long/short fund (it's interesting and I've probably had six requests to look at various long/short strategies in the past month), and trying to come up with an excuse to profile James Balanced Golden Rainbow (GLRBX). At $1.5 billion, it's about $1.4 billion above our usual coverage universe.

    That said, it remains on the due diligence list for Chip's second mutual fund. Last month, she settled on RiverPark Short-Term High Yield (RPHYX) as her first. It will play the sort of cash-equivalent anchor role in her newborn portfolio.

    David
  • edited April 2012
    Reply to @David_Snowball: Thanks David. I think GLRBX can play core holding role in a portfolio (core and explore type of construction) where you need a pretty steady fund.

    BTW, a while back I mentioned to you about FMIJX. I hope that you take a look at FMIJX sometime. That could be a good conservative companion to GLRBX for international coverage.
  • I'm rather curious about the global listed hedge fund ETF from Global X. There's barely any listed hedge funds in the world (although I suppose I'll have to read the prospectus to see what qualifies as a "listed hedge fund.")
  • Reply to @scott: Details are few. It will attempt to track the Solactive Listed Hedge Funds Index, but I can't find any information on the composition (much less performance) of the index. The tracking error is likely to be substantial, first, because the ETF can only invest in the publicly-traded securities in a hedge fund's portfolio (they're not investing in the funds themselves). Second, because there's a six-week lag in the portfolio filings. The prospectus notes: "The 13F filings used to select the securities in the Underlying Index are filed by each hedge fund approximately 45 days after the end of each calendar quarter. Therefore a given hedge fund may have already sold its position by the time of the 13F filing. As a result, a given hedge fund may not hold the position at the time when the position is added to the Underlying Index."

    David
  • "That that is, is; that that is not, is not; that that is is not that that is not; that that is not is not that that is." Or something...
  • edited April 2012
    Reply to @David_Snowball: Thank you for your comments, David - they are always appreciated. There is the Global Hedge fund holdings ETF, which you mentioned, but there is also an ETF coming called Global X Listed Hedge Funds ETF (The fund holds securities and GDRs of publicly listed hedge funds globally.) This would appear to be a fund of listed hedge funds/hedge fund feeder funds, such as the ones in Europe.

    If I'm reading that right, my curiosity is how they're going to fill a fund with maybe a handful of positions at most, unless what qualifies as a "listed hedge fund" (such as Greenlight Reinsurance and its roundabout connection to David Einhorn's Greenlight Capital) covers a wide variety of things.

    GTAA manager Meb Faber (who wrote a chapter in his book on these funds) also apparently addressed this fund from Global X the other day:
    http://www.mebanefaber.com/2012/03/27/13f-listed-hedge-funds-etfs-on-the-way - and apparently he had tried (and scrapped) his attempt to offer a fund-of-funds ETN for these publicly listed hedge funds in 2008 before the market tumble. His comments on the fund of hedge fund positions is also interesting.

  • Reply to @scott: Hi, Scott.

    Yep - the prospectus text is from the upcoming Global X offering.

    David
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