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Discussion with a Portfolio Manager

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Comments

  • LOL Ted! I see you are still doing yeoman's work by posting all the links fit to read! Good job!
  • TedTed
    edited November 2018
    @PBKCM: I see you've been doing very well over the last year with KCMTX !
    Regards,
    Ted
    Fund Return: Category Return: S&P 500: %Rank: Quntile:
    YTD 4.68% -4.63% 0.84% 5% 1
    1yr 8.85% -3.55% 3.95% 2% 1
    3yr2 10.11% 2.46% 10.48% 1% 1
    5yr2 7.67% 1.38% 10.34% 1% 1
    10yr2 8.32% 6.29% 15.15% 14% 1
  • edited November 2018
    Howdy @PBKCM
    I've asked here and have looked about on the wonderful net over the years; as to where does the very large amounts of monies from equity sells travel during the very large sell downs. Hedge funds and some related futures funds, etc. likely park the money internally.
    During the large sell at the end of January and the current sell down, one does not find much evidence of hot money buying investment grade bonds with equity sell monies.
    Might you be aware of some of the current paths for the very large money flows for those organizations who have bailed on the equity sectors?
    Thank you.
    Catch
  • It's good to have @PBKCM (Mr. Binion, I presume) back. BTW, has your firm posted any anticipated year-end distributions. They were substantial last year. Thanks.
  • Thanks @BenWP. Our distribution typically occurs mid-December. I am not sure the amount this year.
  • catch22 said:

    Howdy @PBKCM
    I've asked here and have looked about on the wonderful net over the years; as to where does the very large amounts of monies from equity sells travel during the very large sell downs. Hedge funds and some related futures funds, etc. likely park the money internally.
    During the large sell at the end of January and the current sell down, one does not find much evidence of hot money buying investment grade bonds with equity sell monies.
    Might you be aware of some of the current paths for the very large money flows for those organizations who have bailed on the equity sectors?
    Thank you.
    Catch

    Hi @catch22

    There is a baseline range of trading activity regardless of market direction, as people sell stocks they think will go down and buy stocks they think will go up. At panic sell offs, volume can spike above normal range. I assume that's what you are asking about.

    During these times, some institutions and funds are raising money to meet investor redemptions. The money from these sales leaves the market and goes back to the investor, who may re-invest or sit on his cash awhile. You may have heard the phrase "cash on the sidelines."

    Some institutions and funds shift the money from equities to other asset classes. This will usually be evidenced by rising prices in those asset classes during the stock sell off.

    Some institutions and funds simply hold the cash raised from equity sales until the panic subsides.

    And some institutions and funds need to meet margin calls in their leveraged investments, so they sell their good investments to raise money for the margin calls. We saw this in late January as many VIX products blew up.
  • edited April 2020
    Greetings all. Quite the market. Hope you are safe and sound.

    We've published some market commentary recently, not on our fund per se but the markets generally.

    1. March 13 (after the S&P gained 9% for the day)

    2. March 23 (after the S&P bottomed at 2,192)

    3. April 1 (the day after the S&P topped at 2,641 -- a 20% gain off the March 23 low)
  • thank you PBKCM for sharing.
  • Thanks for stopping in again @PBKCM. I would like to read the commentaries. It's been so long I've forgotten and maybe I will get my answer from the commentaries, but what keeps the risk level of your fund so low?
  • Hi @ET91 and @MikeM

    Despite the fact that Morningstar (wrongly) moved us from Multi-Alternative to Large Blend last August, the prospectus (link located here) makes clear that the fund is "alternative" and designed to be flexible. We are not a "style-box" fund that must invest in certain types of equities at all times.
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