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ORNAX - load at Fidelity but waived at Merrill Edge
Hi, I'm looking at HY Muni Bond Funds. I saw some postings here about ORNAX and looked at my two brokerage accounts Fido/BAML. What causes one broker to waive the fee vs the other to pass it on? Any other insights on HY Muni Funds ... HYD looks interesting as well as XMPT. Thanks, Craig
The mutual fund marketplaces negotiate fees with the MF companies in return for marketing. Some of the fund companies don't want to play ball with the big enchiladas. BTW, I think ORNAX is a great holding; I happen to have it at Schwab.
Thanks BenWP ... I figured as much but would have thought Fidelity would also be on board with Merrill Edge. Glad to hear you are a ORNAX fan, I also own HYD and XMPT
The Rochester family of bond funds are extremely high octane. When things work out, the funds can be fantastic; when they don't, the funds will go down in flames. Even by HY standards, they're quite aggressive.
If you want to know who was deep into Puerto Rican bonds, look no further. They're all managed "the Rochester way".
In 2006, this fund, then known as Oppenheimer Rochester National Municipals was flying high as the top selling muni fund. By 2009 it had crashed and burned. In 2014 it settled a suit alleging that the fund had misrepresented its risks. It wasn't until last October that settlement payments were made: http://securities.stanford.edu/filings-case.html?id=104270
Apparently this action (or perhaps others) were enough to convince Oppenheimer to change the fund's risk disclosures on July 29, 2013 and to change the name of the fund itself from National Muni to High Yield Muni on Nov 27, 2013 (per prospectus of the same date).
While much of this is somewhat old history, I don't know how much has changed. Certainly Oppenheimer made many changes on June 29th of last year, dropping "Rochester" from the name of several muni funds. More importantly, it dropped five of the six managers from ORNAX.
Of course since then, Mass Mutual has sold Oppenheimer Funds to Invesco. Maybe these earlier moves were just preparation, or maybe they're more. Certainly the ORNAX manager overhaul goes beyond window dressing.
All that said, one can't deny its high (albeit erratic) performance. I hope it works for you.
Load is waived at Fido now. No transaction fee either. May have a dabble with some spare cash, but have bonds run their course? (Just thinking out loud.)
A bit lower octane option within the family is OPTAX. A few less percentage in Puerto Rican bonds, a few years lower duration, lower Beta, lower Alpha, and lower Standard Deviation. Accordingly, the 3-month, YTD, 1-year, and 3-year total return for OPTAX trails ORNAX.
Comments
Glad to hear you are a ORNAX fan, I also own HYD and XMPT
If you want to know who was deep into Puerto Rican bonds, look no further. They're all managed "the Rochester way".
In 2006, this fund, then known as Oppenheimer Rochester National Municipals was flying high as the top selling muni fund. By 2009 it had crashed and burned. In 2014 it settled a suit alleging that the fund had misrepresented its risks. It wasn't until last October that settlement payments were made:
http://securities.stanford.edu/filings-case.html?id=104270
Apparently this action (or perhaps others) were enough to convince Oppenheimer to change the fund's risk disclosures on July 29, 2013 and to change the name of the fund itself from National Muni to High Yield Muni on Nov 27, 2013 (per prospectus of the same date).
While much of this is somewhat old history, I don't know how much has changed. Certainly Oppenheimer made many changes on June 29th of last year, dropping "Rochester" from the name of several muni funds. More importantly, it dropped five of the six managers from ORNAX.
Of course since then, Mass Mutual has sold Oppenheimer Funds to Invesco. Maybe these earlier moves were just preparation, or maybe they're more. Certainly the ORNAX manager overhaul goes beyond window dressing.
All that said, one can't deny its high (albeit erratic) performance. I hope it works for you.
https://fundresearch.fidelity.com/mutual-funds/summary/00141W505
Pick your medicine.
Mona