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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.

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Oceanstone caveat emptor and mxxvx

romroc
edited August 2012 in Fund Discussions
I'm attempting to get out of osdfx. It has redeeming qualities, so I'm selling. Not so fast. Telephone redemptions are not allowed and I was told to produce a 'letter of intent,' take it to my bank for a signature guarantee. When I did just that, the bank manager, someone I've known for some time, wouldn't take it, claiming that she needed a form instead. She found one, online. The people at MSS, the administrator, apparently did not know about the available download and claim that they receive handwritten notes all the time for redemptions, which I seriously doubt. Can't get that guarantee at the bank that easily, Fed regs and all. Just be aware that Oceanstone is not an easy exit or other sale fund. Easy to purchase shares though.

However, I did print out a list of funds that are administered by MSS and one caught my eye: the Matthews 25 Fund. It's YTD is at 28.23%. Anyone out there have or care to venture an opinion? $10,000 minimum, interesting statement from 2011. It's chart looks compelling as well. And Oceanstone? At the bottom of the sea right now, IMO. $10000 is a lot to part with, but the gains look great. It's a small fund, so it might be a good fit in MFO. Please, I could use an opinion here on a seldom followed fund.

Comments

  • andrei
    Just make sure that you will not sell Matthew 25 (not Matthews 25) when it falls: From 2007 to 2009 its fall was %63, which may be terrifying while it happens.
  • romroc
    That's interesting. I saw the graph plot, but didn't realize it was so severe. When will we see such a catastrophic fall again? I hope never. I see that this fund has a very low turnover. That probably adds some volatility as they hold on for dear life a stock they believe in as the market sells off. It looks like long term they have been proven correct, but it takes a lot of guts to weather that kind of storm. You think that the sky is falling and you have failed when it is just the sameol' sameol.'
  • kevindowkevindow
    MXXVX holds only 22 positions in the very volatile LCG space, and has a whopping 17% invested in Apple according to M* data. Even though I am having to redo my vegetable garden due to Apple's ownership of the rectangular shape, I think it is a great company, but 17% seems like over the top love of a position. I have no interest in this fund.

    Kevin
  • scott
    edited August 2012
    Reply to @kevindow: OT, but as for Apple, an amusing take regarding Apple - http://www.rollingstone.com/politics/blogs/taibblog/more-evidence-wall-street-is-overpaid-20120821

    I think MXXVX has done very well, but I think the concerning thing is that you see funds like this, CGM Focus, and the Cambiar funds that can have very hot and cold years, with significant volatility on top of it. Difficult holds and really only for those that have that degree of risk tolerance.
  • Old_JoeOld_Joe
    Reply to @kevindow: Only rounded rectangles. Just square up the corners and you'll be fine.
  • Old_JoeOld_Joe
    Reply to @romroc: Not sure, but I think that "MXXVX" = 63 in roman numerals.
  • kevindowkevindow
    Reply to @scott:

    Thanks for that article -- very funny, especially this:

    "Because it seems like our best minds kind of suck at investing."

    Kevin
  • [Deleted User]
    The user and all related content has been deleted.
  • hank
    edited August 2012
    Reply to @Maurice: You explained that better than I've understood it before. Hate having to get signature guarantees, but assume the company is looking out for my best interests. If you don't mind the bank photo-copying all your documents, they're relatively quick & painless. Many fund houses (or others) now allow you to set up a link to your bank checking or savings account. Makes moving $$ in and out super easy. Of course, there are other potential perils.
  • romroc
    Thank you one and all. The 'certain' amount being under $4000 is just a factoid. More importantly, the administrators at MSS were, in one case rude and ill informed, later the fund go to person was cagey when I tried to inform her about the specifics--eg that a proper form was available from OSFDX. What if you wanted to withdraw say $800--you still have to go through the process, as far as I know. This combined with the lack of knowledge of the administrators, the lack of information from the fund principals, make for an uncomfortable experience for me. All I'm saying is that this fund has some unusual practices which you may or may not find to your liking. What if you want to do a telephone switcheroo to avoid a presumed panic--you can't get out fast enough.

    Thanks again for all the input on MXXVX [equals 63]. Sounds like Roman times are fast approaching at 63 miles per hour.

    Thank you Maurice for the info on the medallion signature. Doesn't sound to me that any bank would assign one of these in a cavilier fashion to a handwritten note. I wish that I had more information on fund administrator MSS, however, I do not. Not happy with their overall attitude. Lastly, isn't Apple a rather good one to own and Kansas City Southern may be all that you need to know in the world of investing, if you had to pick just one.
  • Old_JoeOld_Joe
    Reply to @romroc: Seriously, yes, Kansas City Southern may well be all that you need to know in the world of investing, if you had to pick just one. Warren Buffett certainly feels that there are bright days ahead for the US railway industry. And also yes, Apple is currently "a rather good one to own", but "currently" is the gotcha word there.

    Mr. Buffett has said that he always prefers companies that have a financial "moat" which will help to protect them from outside attacks. In the case of railroads, the moat is the difficulty that a would-be competitor would have in throwing up a new set of tracks right next to yours, and then undercutting you by using the latest in atomic-powered locomotives.

    Apple too is attempting to build a moat, as shown by the lawsuit against Samsung which they have just won. Actually, Samsung was merely a stalking-horse for Google, and the Android operating system. The problem with any tech stock, though, is that moats are notoriously difficult to maintain. It's going to be a lot easier to make iPhones and iPads obsolete than to do the same to those huge locomotives and freight cars.

    In a final note, MXXVX used to be a really big number- a lot more than 63- but with inflation, oil prices, going off the gold standard, and all those stupid housing loans...

    Regards- OJ
  • romroc
    I used to work for a railroad as a loco engineer. Not too many freights, mostly commuter trains. Still, it's good to see that railroads have a bright future. Some think that they might be hauling a lot of coal soon. I think that the Canadian pipeline should have been a rail line, but they didn't ask me for my opinion. Now it's a scandal and political football.
  • hank
    edited August 2012
    Reply to @Old_Joe:

    " ... the moat is the difficulty that a would-be competitor would have in throwing up a new set of tracks right next to yours, and then undercutting you by using the latest in atomic-powered locomotives.". ---

    Not so fast there. They're digging a bigger canal down there that will have some impact on coast-to-coast rail traffic beginning 2014. Major east coast ports are spending big $$ preparing for the new monster container ships.

    http://www.economist.com/node/21543551
  • Old_JoeOld_Joe
    You're probably right, to some extent. But I'd think that bulk cargoes that originate in the lower 48 and are destined for another point in the lower 48 would be safe. Also bulk cargo destined for Asia, if originating in the middle or western US.
  • hank
    edited August 2012
    Reply to @Old_Joe: Yep - Wouldn't bet against the rails or Buffett. Lotta coal, corn & domestic autos still need transport. Happened to stumble across that story yesterday & thought I'd toss it out for consideration. (Having lived around the great lakes all my life, can't even imagine how big those container ships must be!)
  • InvestorInvestor
    I checked the prospectus of Oceanstone Fund (OSFDX). Here is the section on redemptions. Typically a fund typically allows redemptions below certain amount without requiring signature guarantees. This one requires for all redemptions which is interesting.

    Shareholder Redemption: You may redeem your shares of the Fund, at any time, by writing directly to Mutual Shareholder Services LLC, or by returning a redemption form, by regular mail or by express mail, at:

    Oceanstone Fund
    c/o Mutual Shareholder Services
    8000 Town Centre Drive, Suite 400
    Broadview Heights, Ohio 44147

    The written request should include the shareholder’s name, account number, the dollar amount (or the number of shares) the shareholder wants to sell. A shareholder may obtain a redemption form by calling the transfer agent at 1-800-988-6290 or at the Fund website – www.oceanstonefund.com.

    The redemption request must be signed exactly as the shareholder’s name appears on the account application form, with the signature guaranteed. If the Fund shares are owned by more than one person, the redemption request must be signed by all owners exactly as the names appear on the account application form, with at least one signature guaranteed. A signature guarantee is required for redemption of the Fund shares, in order to protect the Fund and the Fund shareholders. You should be able to obtain a signature guarantee from a bank, a credit union (if authorized under state law), or a member firm of the New York Stock Exchange. A notary public cannot provide a signature guarantee. Additional documents may be required for corporations, trustees or guardians. A shareholder in doubt as to what documents are required should contact Mutual Shareholder Services at 1-800-988-6290.
  • romroc
    Thank you investor for the closer examination. I will never, ever put a dime again into Oceanstone, that's my opinion and perogative. Watch the Morningstars fall off this one like a wet rock. It's an arcane fund. I don't get the signature guarantee requirement at all.
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