LINK 2FUNDS. Mid-cap growth JAENX follows the GARP strategy. Its portfolio includes 26% techs, 24% industrials (reshoring themes), healthcare, growth utilities (renewables, grid improvements). (By
@lewisbraham at MFO) (Also, a strange placement near the end of the issue)
EXTRA, FUNDS. With the NAMES-RULE, the SEC has cracked down on misleading fund names. Funds must invest 80% of the assets according to what is in their names, e.g. growth, value, big-data, green, AI, etc. When terms are vague, funds must define them along with applicable criteria in their prospectuses and those will become part of funds’ official investment policy. Fund firms with $1+ billion AUM will have 12 months to comply, smaller firms 18 months. Future flexibility will only be during fund launches when it takes some time to build portfolios, but beyond that, any deviations must be fixed within 90 days.
INCOME. As bond-proxies, UTILITIES (XLU, the worst among 11 S&P sectors) have suffered as rates have risen. But rates are peaking, and utilities should have better prospects ahead, especially growth electric utilities, those involved in renewables and improving grid infrastructure. Mentioned are AEP, CNP, NI. (This previously regular column is now ON/OFF)
ECONOMY. A new plan by the LA Senator CASSIDY and the ME Senator KING to fix SOCIAL SECURITY may work. It will leave the SSA Trust Fund (really, an IOU) alone, but would BORROW $1.5 trillion over 5 years to invest in STOCK index funds. The total US stock market-cap is $43.4 trillion, so this inflow shouldn’t cause much disruption (but don’t underestimate the impact of the inflow of $300 billion/yr. That would be almost double of the US IPOs in a best/hot year like 2021) (Also not mentioned is the increase in the US debt, but what is another $1.5 trillion added to $33 trillion?). This stock investment may cover 75% of the SSA shortfall with the rest coming from COST-CUTTING via increasing the FRA (well, this is the US, not France), raising salary caps, adding means test for higher income earners (so, they pay max into the SSA but may be limited in their SSA benefits). (No mention of how/if this $1.5 trillion would be repaid, but keep in mind that Social Security is a mandatory obligation of the government) (By guest author Allan Sloan)
Dave GOODSELL, Natixis Center for Investor Insights. Most Americans aren’t prepared for RETIREMENT and may be overly optimistic. For many, 2022 was a year when reality hit (with bad stock and bond markets). Financial advisors have been suggesting that fixed-income now has generational opportunities, yet the pain isn’t over for many sectors of fixed-income. Allocation 60-40 makes good sense now. SOCIAL SECURITY may cover only 35-40% of retirement needs, and many Americans would have difficult time covering the rest from their portfolios. LONGEVITY is an underestimated risk, higher than what investors perceive in surveys (#1-volatility, #2-risk of loss).
RETIREMENT. A government SHUTDOWN (federal FY24 starts October 1) won’t disrupt the monthly SSA payments (as that is mandatory spending), but other SSA services would be affected. The announcement of COLA (est +3.2%) would be delayed (without the BLS CPI data). We went through the debt-ceiling fiasco earlier this year, and now this.
Comments
Did you feel, as I did, that Forsyth’s “Up & Down Wall Street” column on interest rates was not as good as most of his writings? Seemed brief and simplistic to me. Often he weaves together many different investment currents and does so in a more satirical methapore rich fashion. Just switched from the actual print version to online Barron’s. So wonder if maybe what I read this morning wasn’t the fully developed piece.
Barron's Digital https://barrons-nj.newsmemory.com/
When I start my Barron's work on Fridays, I do have to rely only on Barron's Online and make guesses of what may be in the paper copy.
Barron's Online https://www.barrons.com/?mod=BOL_LOGO
Forsyth now seems to rotate between Up & Down Wall Street, Economy, etc. So, may be you see a lack of consistency that comes from weekly writings of the same column. I find him a bit frustrating because he keeps revising his pieces all the way until the final print.
Barron's now seems like a Merry-Go-Round with different authors for its regular columns.
Yep. I do have a digital version. There’s a link inside that called “read e magazine.” That seems to reformat it to look more like a page of print. No difference in content. Forsyth’s article is: “Treasury Rates Are Headed Higher. Stocks Won’t Like It.” (Oddly, when I accessed the story a second time the title changed. Now Forsyth’s piece is titled ”Hooray! Treasury Yields Are Up, but There Are Better Income Opportunities.”)
Not a bad piece. Quotes a couple recognized pros on where to invest along the curve. Just not Forsyth’s usual writing style / tenor. (You don’t suppose he’s gone to using AI?)
Lewis Braham has a good piece on a lower risk approach for investing in growth. Features insights into JAENX. Overall, looks like a lot of intriguing content this week. I’d rather read the old Kindle print based version. But the digital ain’t bad. (Amazon stopped selling periodical content a few weeks ago.)
Similar for Trader but subheadings are retained.
“With a nod to our Deadhead central bank chief, what a long, strange trip it’s been—and a bad trip for those who own the 1.25% Treasury bonds due on May 15, 2050, which closed on Thursday at a price of 48.186, more than half off their original price just over three years ago.”
Not even Fidelity website has the word "Growth" in FSUTX name.
M* style classification puts this fund in the midcap value style box.
The SEC filing does list the Fidelity Utilities Growth Fund, minus the "Select."
https://www.sec.gov/Archives/edgar/data/320351/000088019506000036/main.htm
There was a name change back in April 2009 based on the filing below:
https://www.sec.gov/Archives/edgar/data/320351/000071889109000008/main.htm
Here is a copy of that section:
On January 16, 2009, Utilities Portfolio changed its name from Utilities Growth Portfolio to Utilities Portfolio
Incidentally, Zacks still states the fund name is Fidelity Select Utilities Growth Portfolio:
https://www.zacks.com/funds/mutual-fund/quote/FSUTX