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MFO September Ratings and Flows Thru 18 Oct Updated
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.
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