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But how is it able to do that? Very little info on what its invested in on M*.
Incidently their "hedged market opportunity" fund is down 12% ytd. So there. And their tactical allocation "asset rotation" fund is also sucking wind against category.
I also worry because they have fund exclusively devoted to "Robotics & Automation". I immediately think of "Pictet Global Water" fund when I see that, a fund before its time.
I guess IOFAX is unique...maybe time to dabble at little
We will soon have CEFs in the rating system. So, can't yet quickly pull-up numbers, but I seem to remember both PDI and PRY have substantially higher vol than IOFIX. c
The problem is when something looks so good I start worrying about manager being Bernie Madoff's long lost cousin that's all.
If they have hit the perfect formula, people should be piling in so it hits capacity and closes. Maybe that's why Charles alerted us in the first place.
Fact is I have SIRIX at TDA now, and as I'm looking to exit TDA, wanted to look at alternatives. I can purchase IOFAX load waived at Schwab. Think no harm getting toe in since minimum investment in minimal so I don't risk it closing.
But how is it able to do that? Very little info on what its invested in on M*.
Incidently their "hedged market opportunity" fund is down 12% ytd. So there. And their tactical allocation "asset rotation" fund is also sucking wind against category.
I also worry because they have fund exclusively devoted to "Robotics & Automation". I immediately think of "Pictet Global Water" fund when I see that, a fund before its time.
I guess IOFAX is unique...maybe time to dabble at little
Please don’t. We have been talking about this fund for a year now here and there and now you suddenly want to dabble???
Imagine a stock with only one share and you own it and get to determine how it’s valued. While an exaggeration, that is sort of how I imagine some of these unusual debt funds. Much of the risk is idiosyncratic. Everything appears fine so long as A there are no defaults and/or B there are no major shareholder redemptions forcing managers to sell their idiosyncratic and suddenly illiquid securities into a hostile public market. Such funds however because they are idiosyncratic are useful diversifiers when markets are functioning normally. I think structurally they are better suited as closed end funds or interval funds so there are no or less forced redemptions. Closed ends have the other risk though of their premiums to NAV suddenly becoming large discounts. That too could also happen in a period of market stress even if these funds aren’t forced to sell their idiosyncratic debt because of redemptions. For anyone interested to find out what can happen to such idiosyncratic debt in a period of extreme market stress I suggest Googling “Regions Morgan Keegan closed end funds”
Hi VF, here's the fund site. I'd suggest looking through the fact sheet and detailed "presentation" to get the gist of what they're doing - of course keeping in mind they're talking their book to a degree, like any fund guys would do.
If you're looking for a less adventurous, mostly non-agency mortgage fund, have a look at SEMPX.
@VintgeFreak I am saying look at page 24 and understand that this is the same kind of subprime mortgage debt that caused the crash and Region Morgan's meltdown: alphacentricfunds.com/funds/IncomeOpp/presentation.pdf However, much has changed in the subprime market since 2008 and funds like this one, Semper and the Pimco closed-end fund have basically made a fortune off picking through the rubble, profiting off the immense suffering subprime lending caused to the body politic. Capitalism at its best. What has happened are two things--subprime loans are gradually disappearing as what remaining debt issued pre-crisis matures and new issues don't take its place and a lot of the worst mortgage borrowers have already defaulted in many managers who invest in this stuff's view. So they say its safer than it was in 2007. But much of the juice in the sector has already been wrung out of it. The time to buy was in 2009 and 2010. Now there is still illiquidity in the sector, significant credit risk and modest yields for that risk. But people are willing to take that risk because they're desperate for yield. Valuation and pricing are still far from perfect because of liquidity issues. Most of these securities are rated "level 2" during good times like now and some even "level 3." Google the meaning of "level 2 securities," but basically while there is a market for these securities it is nowhere as near as robust as Treasuries or investment grade corporate debt. And in a severe selloff--and in particular a credit driven selloff--pricing again will likely become an issue again.
@AndyJ - I'm really no 007 and which is why I've largely stayed away from pure bond funds. I can read, but I don't think I'm smart enough to understand beyond a certain level.
@LewisBraham - Thanks! The article made more sense after hearing your explanation. I'm not "desperate for yield" really. Vanguard Prime Money Market is looking good (enough) for me.
.....And Tuesday (today, 24th April) was another poopy day. My PREMX was flat. PRSNX down a penny. PTIAX down .04%. And IOFIX? UP by .16%. What's inside that damn burrito, anyway????
Comments
Incidently their "hedged market opportunity" fund is down 12% ytd. So there.
And their tactical allocation "asset rotation" fund is also sucking wind against category.
I also worry because they have fund exclusively devoted to "Robotics & Automation". I immediately think of "Pictet Global Water" fund when I see that, a fund before its time.
I guess IOFAX is unique...maybe time to dabble at little
I guess I don't have more to say than ...
Lightning In A Bottle
d'oh - edited to make it PTY, sorry!
some say as long as under 10% not to overworry (how's that for equivocation?)
If they have hit the perfect formula, people should be piling in so it hits capacity and closes. Maybe that's why Charles alerted us in the first place.
Fact is I have SIRIX at TDA now, and as I'm looking to exit TDA, wanted to look at alternatives. I can purchase IOFAX load waived at Schwab. Think no harm getting toe in since minimum investment in minimal so I don't risk it closing.
Regards,
Ted
http://www.rmkclosedendfundsettlement.com/
Bought IOFIX directly through the transfer agent. A, C and I classes have same initial minimums ($2,500), but different expenses.
If you're looking for a less adventurous, mostly non-agency mortgage fund, have a look at SEMPX.
alphacentricfunds.com/funds/IncomeOpp/presentation.pdf
However, much has changed in the subprime market since 2008 and funds like this one, Semper and the Pimco closed-end fund have basically made a fortune off picking through the rubble, profiting off the immense suffering subprime lending caused to the body politic. Capitalism at its best. What has happened are two things--subprime loans are gradually disappearing as what remaining debt issued pre-crisis matures and new issues don't take its place and a lot of the worst mortgage borrowers have already defaulted in many managers who invest in this stuff's view. So they say its safer than it was in 2007. But much of the juice in the sector has already been wrung out of it. The time to buy was in 2009 and 2010. Now there is still illiquidity in the sector, significant credit risk and modest yields for that risk. But people are willing to take that risk because they're desperate for yield. Valuation and pricing are still far from perfect because of liquidity issues. Most of these securities are rated "level 2" during good times like now and some even "level 3." Google the meaning of "level 2 securities," but basically while there is a market for these securities it is nowhere as near as robust as Treasuries or investment grade corporate debt. And in a severe selloff--and in particular a credit driven selloff--pricing again will likely become an issue again.
@LewisBraham - Thanks! The article made more sense after hearing your explanation. I'm not "desperate for yield" really. Vanguard Prime Money Market is looking good (enough) for me.