Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Just posted all ratings and flows to MFO Premium site, using Refinitiv data drop from Friday, 4 October, reflecting risk and return metrics thru 3Q24 and fund flows thru 4 October, as applicable.
Just posted all ratings and flows to MFO Premium site, using Refinitiv data drop from Friday, 11 October, reflecting risk and return metrics thru 3Q24, as applicable.
Just posted all ratings and flows to MFO Premium site, using Refinitiv data drop from Friday, 18 October, reflecting risk and return metrics thru 3Q24 and fund flows thru 18 October, as applicable.
Expanded Family Score Card to include number of active and passive funds, number of Three Alarm and Great Owl funds. The tool also now includes family revenue, based on AUM times ER, in millions per year. Some of the numbers are pretty stunning. Normalized, the average revenue metric (revenue per fund) provides a measure of revenue efficiency.
There are some 900 fund families. The Score Card only rates families with 5 funds or more (about 300). But we now provide metrics on all 900 families, even families of one, in the Score Card tool. Enjoy.
I checked with Lipper and their folks say it's correct, referencing this 10K filing.
To my knowledge, the fund appears to have lost nearly all its AUM since launching in 2011.
Still can't quite get my head around this.
Here's an excerpt: NOTE 4. INVESTMENT MANAGEMENT FEE
The Company has entered into an investment management agreement (the “Investment Management Agreement”) with FCM pursuant to which the Company will pay FCM a fee for providing investment management services consisting of two components—a base management fee and an incentive fee.
The base management fee will be calculated at an annual rate of 2.00% of our gross assets. For services rendered under the Investment Management Agreement, the base management fee will be payable quarterly in arrears. The base management fee will be calculated based on the average of (1) the value of our gross assets at the end of the current calendar quarter and (2) the value of the Company’s gross assets at the end of the preceding calendar quarter; and will be appropriately adjusted for any share issuances or repurchases during the current calendar quarter. Base management fees for any partial month or quarter will be pro-rated.
The incentive fee is determined and payable in arrears as of the end of each calendar year (or upon termination of the Investment Management Agreement, as of the termination date), commencing on April 15, 2011, and equals 20% of the Company’s realized capital gains, if any, on a cumulative basis from inception through the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid incentive fees, provided that the incentive fee determined as of December 31, 2023, will be calculated for a period of shorter than twelve calendar months to take into account any realized gains computed net of all realized capital losses and unrealized capital depreciation from inception. For the year ended December 31, 2023, there were no Incentive fee adjustments. For the year ended December 31, 2022, there were no incentive fee adjustments. For the year ended December 31, 2021, there were no incentive fee adjustments.
Effective September 30, 2023, the Company has entered into a fee waiver agreement with FCM (the “Fee Waiver Agreement”). Pursuant to the terms of the Fee Waiver Agreement, FCM agrees to (1) waive future accruals of the base management fee starting October 1, 2023, through December 31, 2024, with future recoupment to the extent permitted by the Investment Management Agreement, and (2) waive $2.5 million of base management fee that has been accrued but unpaid prior to but unpaid as of September 30, 2023. Any accrued base management fee waived under section (2) may be recouped by FCM within ten years.
FirstHand SVVC is a closed-end business development company (BDC) on pink sheets (OTC). It doesn't show up in the CEFConnect database, but has quotes at M*, Yahoo Finance. AUM $551K, Price 6c https://finance.yahoo.com/quote/SVVC/key-statistics/
It seems that is has slipped in 2-20 hedge-fund type fees under BDC/CEF structure that isn't allowed for listed funds. Typically, incentives for listed funds are tiny %. Next, I will check its prospectus history. Not sure about rules for pink sheet/OTC funds.
Thank you starCalm. I've updated our master names file to Cliffwater Cascade Private Equity (CPEFX), adding the Cliffwater preface. Today's update should show all three in the family ... hope to post this afternoon. And yes, all three CEF Interval Funds.
Just posted all ratings and flows to MFO Premium site, using Refinitiv data drop from Friday, 25 October, reflecting risk and return metrics thru 3Q24, as applicable.
After updating the masternames file to reflect CPEFX as part of Cliffwater family, Ciffwater remains atop the MFO Family Scorecard for annual revenue per fund generated, out of about 900 hundred families.
Average revenue: $433M per year per fund.
Just three funds (thank you @stayCalm): Cliffwater Corporate Lending I (CCLFX), Cliffwater Enhanced Lending I (CELFX), Cliffwater Cascade Private Capital I (CPEFX).
CCLFX and CELFX are GOs. CPEFX likely will be when reaches 3-year mark.
Very high expense ratio: average ER 2.81%.
Family AUM of $28.2B.
Revenue per fund per year: $289M.
All CEFs.
All interval funds.
So far, it's delivered.
Cliffwater Returns
Anybody on the board know anything about the Advisor or strategies?
Cliffwater LLC is an alternative asset manager with $115 billion AUM. Stephen Nesbitt is the CEO and he has written books, articles, done media interviews. It offers 3 interval-funds: CCLFX, AUM $22.8 billion, 2019- , firm's fund CELFX, AUM $4 bilion, 2021- , firm's fund CPEFX, AUM $1.4 billion, 2024- ; advises for Cascade Capital
Interval-funds don't really trade. Barron's lists them (names, prices) with Exchange Z (i.e. none). Many don't have tickers - Barron's doesn't show tickers for any (even if they exist). This list has grown over the years. Barron's gets data from Lipper.
My guess is that Lipper has added more interval-funds to its database, so, MFO Premium suddenly finds Cliffwater Funds with $28.2 billion AUM that weren't noticed before.
Interval-funds are a subclass of CEFs, so borrowing costs are included in the ERs. The CEF ERs are high because of this, but Cliffwater funds are on the high end. Here is the fee breakdown for CCLFX fees from its prospectus:
Management Fees 1.00 % Fees and Interest Payments on Borrowed Funds 1.51 % Acquired Fund Fees and Expenses 0.35 % Other Expenses 0.23 % Total Annual Expenses 3.09 %
Nice. Thank you, ybb. Any comment/insight into its strategies? I will also rethink the Revenue metric. Perhaps as is the metric should be regarded as Gross Revenue, before fees, interest, acquisition, and other expenses, depending. At least Cliffwater does not charge load, 12b-1, or delve in other share classes. Will plan to get through background info you sent ... still, curious about your thoughts on its strategy ... or anyone else on the board.
Cliffwater used to be an institutional investment advisor before they got into the retail game. They manage the widely used Cliffwater Direct Lending Index.
Strategy is pretty straightforward -- direct lending/private credit for CCLFX and CELFX. CPEFX is a 2024 acquisition which even though Cliffwater has no track record in PE, they've been growing AUM at a pretty rapid clip due to their brand name and track record in private debt.
Thanks @stayCalm. We don't get CEF fund flows in our Lipper feed, unfortunately. But we do have AUM going back 10 years or so ... perhaps time to compile that into our own flows database for CEFs and Insurance Funds. Would be monthly. Here's performance summary:
Just posted all ratings and flows to MFO Premium site, using Refinitiv data drop from Friday, 8 November, reflecting risk and return metrics thru October and month-to-date (MTD) thru yesterday. Flows are through Friday, 1 November.
Just posted all ratings and flows to MFO Premium site, using Refinitiv data drop from Friday, 15 November, reflecting risk and return metrics thru October and month-to-date (MTD) thru yesterday. Flows are also posted through Friday, 15 November.
Comments
There are some 900 fund families. The Score Card only rates families with 5 funds or more (about 300). But we now provide metrics on all 900 families, even families of one, in the Score Card tool. Enjoy.
The culprit is a CEF Firsthand Technology Value Fund SVVC with an ER of -7.21.
I checked with Lipper and their folks say it's correct, referencing this 10K filing.
To my knowledge, the fund appears to have lost nearly all its AUM since launching in 2011.
Still can't quite get my head around this.
Here's an excerpt:
NOTE 4. INVESTMENT MANAGEMENT FEE
The Company has entered into an investment management agreement (the “Investment Management Agreement”) with FCM pursuant to which the Company will pay FCM a fee for providing investment management services consisting of two components—a base management fee and an incentive fee.
The base management fee will be calculated at an annual rate of 2.00% of our gross assets. For services rendered under the Investment Management Agreement, the base management fee will be payable quarterly in arrears. The base management fee will be calculated based on the average of (1) the value of our gross assets at the end of the current calendar quarter and (2) the value of the Company’s gross assets at the end of the preceding calendar quarter; and will be appropriately adjusted for any share issuances or repurchases during the current calendar quarter. Base management fees for any partial month or quarter will be pro-rated.
The incentive fee is determined and payable in arrears as of the end of each calendar year (or upon termination of the Investment Management Agreement, as of the termination date), commencing on April 15, 2011, and equals 20% of the Company’s realized capital gains, if any, on a cumulative basis from inception through the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid incentive fees, provided that the incentive fee determined as of December 31, 2023, will be calculated for a period of shorter than twelve calendar months to take into account any realized gains computed net of all realized capital losses and unrealized capital depreciation from inception. For the year ended December 31, 2023, there were no Incentive fee adjustments. For the year ended December 31, 2022, there were no incentive fee adjustments. For the year ended December 31, 2021, there were no incentive fee adjustments.
Effective September 30, 2023, the Company has entered into a fee waiver agreement with FCM (the “Fee Waiver Agreement”). Pursuant to the terms of the Fee Waiver Agreement, FCM agrees to (1) waive future accruals of the base management fee starting October 1, 2023, through December 31, 2024, with future recoupment to the extent permitted by the Investment Management Agreement, and (2) waive $2.5 million of base management fee that has been accrued but unpaid prior to but unpaid as of September 30, 2023. Any accrued base management fee waived under section (2) may be recouped by FCM within ten years.
AUM $551K, Price 6c
https://finance.yahoo.com/quote/SVVC/key-statistics/
It seems that is has slipped in 2-20 hedge-fund type fees under BDC/CEF structure that isn't allowed for listed funds. Typically, incentives for listed funds are tiny %. Next, I will check its prospectus history. Not sure about rules for pink sheet/OTC funds.
Edgar/SEC 10-Q https://www.sec.gov/ix?doc=/Archives/edgar/data/1495584/000143774924026819/sccv20240630d_10q.htm
Edit/Add. 10/2023 notice of withdrawal as a BDC & liquidation. So, whatever is going on in OTC trading of SVVC isn't significant for typical fund investors.
https://www.sec.gov/Archives/edgar/data/1495584/000139834423019276/fp0085668-1_ex991.htm
https://www.sec.gov/ix?doc=/Archives/edgar/data/1495584/000139834423019276/fp0085668-1_8kixbrl.htm
Yes, despite the bluster, suspect end is near for FirstHand SVVC.
Another stunning find in the updated Family Scorecard: CliffWater.
It tops the revenue per fund metric with $433M per year per fund.
Just two funds: Cliffwater Corporate Lending I (CCLFX) and Cliffwater Enhanced Lending I (CELFX).
Super hi expense ratio.
About $27B AUM.
Near perfect performance. Annuity-like. Little drawdown. As was IOFIX, once. Steady eddy.
Both CEFs.
After updating the masternames file to reflect CPEFX as part of Cliffwater family, Ciffwater remains atop the MFO Family Scorecard for annual revenue per fund generated, out of about 900 hundred families.
Average revenue: $433M per year per fund.
Just three funds (thank you @stayCalm): Cliffwater Corporate Lending I (CCLFX), Cliffwater Enhanced Lending I (CELFX), Cliffwater Cascade Private Capital I (CPEFX).
CCLFX and CELFX are GOs. CPEFX likely will be when reaches 3-year mark.
Very high expense ratio: average ER 2.81%.
Family AUM of $28.2B.
Revenue per fund per year: $289M.
All CEFs.
All interval funds.
So far, it's delivered.
Anybody on the board know anything about the Advisor or strategies?
c
CCLFX, AUM $22.8 billion, 2019- , firm's fund
CELFX, AUM $4 bilion, 2021- , firm's fund
CPEFX, AUM $1.4 billion, 2024- ; advises for Cascade Capital
Interval-funds don't really trade. Barron's lists them (names, prices) with Exchange Z (i.e. none). Many don't have tickers - Barron's doesn't show tickers for any (even if they exist). This list has grown over the years. Barron's gets data from Lipper.
My guess is that Lipper has added more interval-funds to its database, so, MFO Premium suddenly finds Cliffwater Funds with $28.2 billion AUM that weren't noticed before.
Interval-funds are a subclass of CEFs, so borrowing costs are included in the ERs. The CEF ERs are high because of this, but Cliffwater funds are on the high end. Here is the fee breakdown for CCLFX fees from its prospectus:
Management Fees 1.00 %
Fees and Interest Payments on Borrowed Funds 1.51 %
Acquired Fund Fees and Expenses 0.35 %
Other Expenses 0.23 %
Total Annual Expenses 3.09 %
Morningstar also has data https://www.morningstar.com/cefs/xnas/cclfx/quote
Morningstar Podcast https://www.morningstar.com/business/insights/blog/podcast/big-picture-in-practice/future-of-investing-alternative-assets
https://www.cliffwater.com/OurFirm
https://www.cliffwater.com/Biography?name=Stephen-Nesbitt
https://www.cliffwaterfunds.com/
https://www.barrons.com/market-data/closed-end-funds?mod=md_subnav
https://www.cliffwaterfunds.com/data/pdfs/literature/CCLF_Prospectus.pdf?v=1730115265804
Strategy is pretty straightforward -- direct lending/private credit for CCLFX and CELFX. CPEFX is a 2024 acquisition which even though Cliffwater has no track record in PE, they've been growing AUM at a pretty rapid clip due to their brand name and track record in private debt.
Edwards Jones clocks investors $219M per year on $31B AUM ... or, 0.71% on its JNSXX money market fund.