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"In November 2021, T. Rowe launched its Summit Program, which allows any investor with more than $250,000 at the firm to buy top-performing closed funds like Capital Appreciation. Of course, many investors don’t have that kind of wealth and don’t necessarily want to tie up their assets with one money manager. In T. Rowe’s case, though, its brokerage offers funds from other families, stocks, and exchange-traded funds—and assets in them count toward Summit’s minimum."
"Another entry point is through a financial advisor who is already invested in a closed fund for other clients or who may have access to a still-open institutional share class. Artisan also does this. “Funds can close in all sorts of different levels,” says Russel Kinnel, Morningstar’s director of manager research. “You’ve got all sorts of sales channels out there. [Fund companies] can limit all of them or some of them.”
One other way of getting into a closed fund at TRP is by rolling over funds from a 401(k) to a TRP retirement account. I did this and bought a small position in PRWCX which I rolled it over to an existing IRA at another broker. That allowed me to buy more shares in the existing account.
I just called up T Rowe and they don’t have an exact launch date but the consultant said it would be soon . I will let everyone know when I hear about a launch date. The consultant did say it would be managed in a similar way as PRWCX in terms of its equity investments. Goal is to be up to 80% equities.
@MikeW’s question about an ETF to be managed by Giroux reminded me that more and more mutual fund providers are getting into ETFs, sometimes creating very attractive vehicles managed by successful OEF PMs. @TheShadow keeps track of a lot of these new funds for us, a great service. I don’t know of specific ETFs that might be clones of closed MFs.
Unfortunately, the proliferation of ETFs in the last few years makes it hard for an amateur like me to keep track. Some of the more interesting new ETFs have been created by American Century (Avantis), PGIM, Van Eck, Pacer, Cambria, Harbor, and Franklin-Templeton, to say nothing of all the house funds offered by Fidelity and Schwab. I think I would have to subscribe to one of the ETF dedicated web sites and spend way more time than I want in order to closely follow developments.
The subject matter described herein is very sneaky - I like it! Good article which mentions several potential avenues for investing in closed mutual funds.
Vanguard Health Care had an annualized 16.4% return during Ed Owens' long tenure (05/23/1984 - 12/31/2012) compared to the the S&P 500 index's 10.7% return. This fund has not performed as well since Jean Hynes became the sole named manager in 2013.
Note: Today it was announced that longtime analyst Rebecca Sykes was promoted to comanager on Vanguard Health Care.
@bee: you are very kind to suggest I might be capable of opening a new web site devoted to ETFs. I would need a cast of volunteers to do the real work as well as a minder to prevent me from buying every can’t-miss ETF that will surely come along. However, getting in on the ground floor might be attractive to sharp-eyed investors like you. As for today, my old sports car won’t start, my attempt to turn on an outside garden hose provoked a minor plumbing job for me, and my vegetable garden is tilled but not planted. I wonder how I found time to work in the old days pre-retirement.
@bee: you are very kind to suggest I might be capable of opening a new web site devoted to ETFs. I would need a cast of volunteers to do the real work as well as a minder to prevent me from buying every can’t-miss ETF that will surely come along. However, getting in on the ground floor might be attractive to sharp-eyed investors like you. As for today, my old sports car won’t start, my attempt to turn on an outside garden hose provoked a minor plumbing job for me, and my vegetable garden is tilled but not planted. I wonder how I found time to work in the old days pre-retirement.
FWIW saying I'd posit that many of the ETFs that launch these days probably aren't even worth discussing ... low liquidity, low AUM, rapid closures, too gimmicky, etc. NewETFDeathWatch.Com might be an easier (and more fun?) task.
"Although usually forbidden if you're buying directly from a fund company, an existing shareholder of a closed fund at an outside broker can transfer a share to you without the fund company knowing about it. Once in, you can add to your position."
Maybe, maybe not. You can get a share of ARTKX that way, but if
you receive shares of the closed Fund as a gift from an existing shareholder of the Fund (additional investments generally are not permitted unless you are otherwise eligible to open an account under one of the other criteria listed);
@rforno: you are quite right about the number of new ETFs that should never have seen the light of day and which merit no recommendation. I have browsed a couple of the ETF-dedicated sites and quickly realized that what passes for news is no more than a regurgitated press release from the sponsor of the latest 3X (fill in the asset here) vehicle. It's also true that there many MFs whose deletion from the ranks would not cause a ripple.
The big fund companies seem to have no trouble issuing ETFs and gathering big assets. I suspect they, like American Funds, have massive retirement AUMs and they can direct their managers to buy the new issues. Harbor Funds, on the other hand and despite some highly rated OEFs do not seem to be able to generate trading volume in what I consider to be attractive ETFs. Unfortunately, Harbor has lost AUM every year since 2014, so getting into ETFs might be seen as a effort to stem the ebb tide. Their ETF assets are rising, but don't offset OEF losses. FWIIW, I own HIISX and just recently purchased WINN, Harbor Long Term Growers ETF. This fund is managed by the same people at Jennison Associates who run their growth strategies, including Harbor Capital Appreciation. The late Sig Segalis was the guru of that strategy. PGIM, Jennison Focused Growth ETF, competes for the same assets, albeit at a higher ER than the Harbor fund. Proliferation for sure resulting in a trivia-laden post such as this one.
@MSF The nature of omnibus accounts at outside brokers provides limited information to fund managers, so they don't know generally who owns the funds individually, although I think there are circumstances when there is suspicious trading activity, like the market timing scandal many years ago when they can request more info
That ability of a fund to request information is a direct result of the market trading scandal:
The market timing and late trading issues of the mid 2000’s were caused, in certain cases, by the lack of transparency regarding beneficial mutual fund owners invested through omnibus accounts. Rule 22c-2 under the 1940 Act, which the SEC adopted in response to those scandals, requires a fund to enter into written agreements with financial intermediaries, including those maintaining omnibus account positions with the fund, in which the intermediary agrees to provide the fund with certain shareholder information upon request and to implement any fund-imposed trading restrictions on investors identified by the fund as having violated the fund’s frequent trading policy
Although these policies are designed to deter frequent trading, none of these measures alone, nor all of them taken together, eliminate the possibility that frequent trading will occur in these funds, particularly with respect to trades placed by shareholders who invest in these funds through omnibus accounts maintained by brokers, retirement plan accounts, and other financial intermediaries. The Funds’ access to information about individual shareholder transactions made through such omnibus arrangements is often unavailable or severely limited. As a result, the Funds cannot ensure that their policies will be enforced with regard to those fund shares held through such omnibus arrangements (which may represent a majority of fund shares), so frequent trading could adversely affect these funds and their long-term shareholders as discussed above.
Sometimes (though probably not with this), enforcement is effected through intimidation, being told something like: "we can get you if you break our rules", even if that's not true.
I was already in PRWCX in an IRA, but I was happy to get into PRWCX recently in a taxable and Roth account. I don't remember seeing anything about the Summit Program until recently. Then I just went into TRP and opened up PRWCX just like any other fund.
Vanguard Health Care had an annualized 16.4% return during Ed Owens' long tenure (05/23/1984 - 12/31/2012) compared to the the S&P 500 index's 10.7% return. This fund has not performed as well since Jean Hynes became the sole named manager in 2013. Note: Today it was announced that longtime analyst Rebecca Sykes was promoted to comanager on Vanguard Health Care.
Jean Hynes performance hasn't beaten the Morningstar US Health index since she took over. I am pleasantly surprised that they named a comanager. Jean Hynes is also the CEO of Wellington, so not exactly an easy person to remove from a fund against her will.
Comments
One other way of getting into a closed fund at TRP is by rolling over funds from a 401(k) to a TRP retirement account. I did this and bought a small position in PRWCX which I rolled it over to an existing IRA at another broker. That allowed me to buy more shares in the existing account.
https://www.sec.gov/Archives/edgar/data/1795351/000174177323000929/c497k.htm
Unfortunately, the proliferation of ETFs in the last few years makes it hard for an amateur like me to keep track. Some of the more interesting new ETFs have been created by American Century (Avantis), PGIM, Van Eck, Pacer, Cambria, Harbor, and Franklin-Templeton, to say nothing of all the house funds offered by Fidelity and Schwab. I think I would have to subscribe to one of the ETF dedicated web sites and spend way more time than I want in order to closely follow developments.
Are you introducing a new website for investors? I like the idea.
Maybe we name it “EFT Alarm” later to be named “ETF Observer”.
Let’s great this party started:
VGHCX = VHT
I have often wondered why EFTs don’t hyperlink like mutual funds do on this site.
https://etfdb.com/
Good article which mentions several potential avenues for investing in closed mutual funds.
However, healthcare VHCIX is indexed and has VHT as the ETF class.
long tenure (05/23/1984 - 12/31/2012) compared to the the S&P 500 index's 10.7% return.
This fund has not performed as well since Jean Hynes became the sole named manager in 2013.
Note: Today it was announced that longtime analyst Rebecca Sykes
was promoted to comanager on Vanguard Health Care.
Maybe, maybe not. You can get a share of ARTKX that way, but if Prospectus.
The big fund companies seem to have no trouble issuing ETFs and gathering big assets. I suspect they, like American Funds, have massive retirement AUMs and they can direct their managers to buy the new issues. Harbor Funds, on the other hand and despite some highly rated OEFs do not seem to be able to generate trading volume in what I consider to be attractive ETFs. Unfortunately, Harbor has lost AUM every year since 2014, so getting into ETFs might be seen as a effort to stem the ebb tide. Their ETF assets are rising, but don't offset OEF losses. FWIIW, I own HIISX and just recently purchased WINN, Harbor Long Term Growers ETF. This fund is managed by the same people at Jennison Associates who run their growth strategies, including Harbor Capital Appreciation. The late Sig Segalis was the guru of that strategy. PGIM, Jennison Focused Growth ETF, competes for the same assets, albeit at a higher ER than the Harbor fund. Proliferation for sure resulting in a trivia-laden post such as this one.
Still, as you said, this only goes so far: Guggenheim Funds frequent trading policy
Sometimes (though probably not with this), enforcement is effected through intimidation, being told something like: "we can get you if you break our rules", even if that's not true.
It's free. They cover more that ESG ratings. And they have not sent me any emails since I signed up.