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According to M* IAFMX is a LC growth fund with small AUM=59 million and expensive ER=1.15%. It invests mostly in the tech category at 54%. Concentrated portfolio of about 30 stocks, top holdings MSFT,Apple,AMAZON,ADOBE Why not just use QQQ which beats it for 1-3-5 years. If you want to gamble on tech go for MPEGX/MACGX
As FD1K noted, a cursory look suggests that there is nothing particularly special here, just a small, concentrated, expensive fund with several of the usual suspects.
So what's unusual? High turnover. M* reports 139%. The prospectus Shadow provided says nearly twice as high, 230%! More remarkable is that only 15% of its holdings are companies it acquired in the past year. This suggests that all it is doing is rebalancing its portfolio every day of the week and twice on Sundays. It also suggests that the fund will not be tax efficient, and the numbers confirm that (2.26% tax cost ratio).
Aside from funds with frenetic managers like Dick Strong, high turnover funds are often quant funds. Sure enough, the prospectus reads: "The Adviser uses quantitative screens ... The Adviser then uses a quantitative process ... The periodic reconstitution and rebalancing of the portfolio according to the Fund’s quantitative investment strategy may result in significant portfolio turnover."
Why not just use QQQ which beats it for 1-3-5 years.
I didn't realize that IAFMX had been around that long. Shadow's prospectus gives the inception date as 10/03/16. What's its five year annualized performance? Do you have some incubator numbers that we could tack on?
IAFMX was formerly the Cognios Large Cap Growth Fund.
Thanks. This confirms that the fund started 10/3/16, though it subsequently went through at least a name change.
Note that there is enough predecessor history as reported in an early N1/A filing to get about eight years of combined history. Though the filing doesn't seem to provide the predecessor's performance data for 2016, i.e. from 1/1/2016 to 10/3/2016 when the new fund started. One could reasonably extrapolate to fill in this gap.
The Predecessor Account was managed by the same portfolio managers at the Adviser of the Growth Fund since the inception of the Predecessor Account on June 1, 2012. ...
The bar chart and table reflect the past performance of the Growth Fund and the Predecessor Account and provide some indication of the risks of investing in the Growth Fund by showing changes in the Predecessor Account’s performance from year to year over the periods indicated and by showing how the Predecessor Account’s average annual total returns for the periods indicated compared to a broad-based performance benchmark.
FWIW, the predecessor account, over the period provided (6/1/12 to 12/31/15) had an annualized return of 21.92% (per filing). In comparison, QQQ returned 18.30%.
I computed the latter figure by: - having M* give me QQQ's cumulative return from 6/1/12 to 12/31/15: 82.53%; - computing the number of years spanned with Excel: YEARFRAC(DATE(2012,6,1),DATE(2015,12,31),1): 3.5811 years. - annualizing: POWER(1 + 0.8253, 1/3.5811) = 1.182976. So QQQ's rate of return was 18.30%.
Comments
https://www.sec.gov/Archives/edgar/data/1643838/000138713120004056/fm-485bpos_042220.htm
Why not just use QQQ which beats it for 1-3-5 years.
If you want to gamble on tech go for MPEGX/MACGX
So what's unusual? High turnover. M* reports 139%. The prospectus Shadow provided says nearly twice as high, 230%! More remarkable is that only 15% of its holdings are companies it acquired in the past year. This suggests that all it is doing is rebalancing its portfolio every day of the week and twice on Sundays. It also suggests that the fund will not be tax efficient, and the numbers confirm that (2.26% tax cost ratio).
Aside from funds with frenetic managers like Dick Strong, high turnover funds are often quant funds. Sure enough, the prospectus reads: "The Adviser uses quantitative screens ... The Adviser then uses a quantitative process ... The periodic reconstitution and rebalancing of the portfolio according to the Fund’s quantitative investment strategy may result in significant portfolio turnover."
Here's a M* column on quant funds:
https://www.morningstar.com/articles/947272/what-is-a-quantitative-fund
https://www.sec.gov/Archives/edgar/data/1643838/000138713120004152/fm-497_042220.htm
Here is the Cognios Large Cap Growth Fund prospectus from 10/3/16:
https://www.sec.gov/Archives/edgar/data/1643838/000139834416020683/fp0022458_497.htm
Here is the initial registration filing for Cognios Large Cap Growth Fund:
https://www.sec.gov/Archives/edgar/data/1643838/000139834416019245/fp0021866_n1aa.htm
IAFMX inception was on 10/03/16.
Note that there is enough predecessor history as reported in an early N1/A filing to get about eight years of combined history. Though the filing doesn't seem to provide the predecessor's performance data for 2016, i.e. from 1/1/2016 to 10/3/2016 when the new fund started. One could reasonably extrapolate to fill in this gap. https://www.sec.gov/Archives/edgar/data/1643838/000139834416018829/fp0021688_n1aa.htm
FWIW, the predecessor account, over the period provided (6/1/12 to 12/31/15) had an annualized return of 21.92% (per filing). In comparison, QQQ returned 18.30%.
I computed the latter figure by:
- having M* give me QQQ's cumulative return from 6/1/12 to 12/31/15: 82.53%;
- computing the number of years spanned with Excel:
YEARFRAC(DATE(2012,6,1),DATE(2015,12,31),1): 3.5811 years.
- annualizing: POWER(1 + 0.8253, 1/3.5811) = 1.182976. So QQQ's rate of return was 18.30%.