I have a highly diversified stable of investments/income producing vehicles. More bearish lately and have been taking profits/building cash (and cash like) investments. My question…
I’m looking for a fund that goes anywhere/does anything to produce gains. It has the discretion to do that and does it. A hedge fund like mutual fund. Think Oceanstone or CGM Focus. I’m not concerned about risk just something that I can slowly build a position in, in the next 3-4 years. I was really interested in MRFOX but the hoops I would have to jump through to buy and sell are too much. Signature guarantees to sell a large amount? No thanks.
Any suggestions where I should be looking? Thank you.
Comments
- Also try QAI (Hedge fund tracker etf) 10 YR Return 1.8% (Not Rated at Morningstar).
Personally I probably wouldn’t buy such a fund. Hedge funds have the advantage of being able to lock-up an investor’s assets for a set number of years. Allows higher level of risk taking. Mutual funds do not have that advantage. Lose 10% in a year and $$ rushes out the door.
- One (approximation) I’ve owned for short periods in the past (without fully comprehending) is the CEF GUG.
I’d term it “Go anywhere with an emphasis on fixed income”. Quite volatile as CEFs tend to be.
- BCAT (CEF) managed by Rick Rieder might fit your bill. I bailed after it jumped 10 or 15% a year or so ago. Heights bother me. Rieder has a lot of discretion in what to buy.
- You might look at GAA. Globally diversified fund of funds. Risk averse high (media) profile manager some would rather avoid. Spreads the risk around. Seems to have a lot of personal discretion which Morningstar loathes. Exposure to gold / EM. But not billed as “go anywhere.” Morningstar Neutral Rating. 5 YR +5.64% (Disclosure: I own this one.)
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Also, QLENX - AQR Long-short, QMNRX - AQR Market neutral.
“This Go Anywhere Fund Beats 99% of its Peers” (I am a subscriber. Likely the link won’t help you much.)
Barron’s
Excerpt: “The lead manager of Allspring Diversified Capital Builder (ticker: EKBAX) invests in everything from high-quality blue chips like Alphabet (GOOGL) and small industrial stocks like Timken (TKR) to Treasury, high-yield, and convertible bonds.”
See @msf’s link below.
In the meantime … This linked story credits Blackrock with creating a “Go Anywhere” fund for star manager Rick Rieder to run. Take it with a grain of salt.
https://www.barrons.com/articles/go-anywhere-find-beats-99-of-peers-6547f85a
"I was really interested in MRFOX but the hoops I would have to jump through to buy and sell are too much. Signature guarantees to sell a large amount? No thanks."
I own MRFOX at Schwab. There is no signature guarantee to sell at Schwab. You just put in a trade when you want to sell.
Just know that there is a contingent redemption fees of 2% (?) if sold within 90% of purchase.
I am not a big fan of "go any where" funds. Most professional managers can not handle two asset classes (e.g., bonds and stocks) that many allocation funds do not do well. I would just find good allocation fund (s) instead of looking for go any where funds. With only bonds and stocks one can create so many variations in ones portfolio that I am not thinking of seriously venturing into other asset classes.
I had been in Oceanstone before it closed and was obviously wildly impressed. Sad ending there.
I can’t access MRFOX via brokerage (don’t want additional ones) so my only way in that one is direct investment. That is where the signature guarantee comment resonated from.
This desire would be a smaller part of the portfolio, not a large one. Those larger positions were made years ago and I’m good there.
I may just create have to create my own “go anywhere” fund myself through ETFs and funds. It maybe easier to run my own “hedge fund” like fund myself. Finding one currently that meets my needs is harder than I thought.
Thanks again.
Hedge funds ISTM have much looser restrictions than publicly traded funds,
That's a broad ranging fund, but lacks a GA feature: discretion. https://www.permanentportfoliofunds.com/pdf/Prospectus.pdf
Conceptually, I like the idea of a fund that can move at will to the "best" market. But then one thinks about it. It's hard enough to adjust a portfolio in the time dimension (when to be in the market, when out). Relatively few managers try even that baby step. Partly due to investors' expectations, partly due to difficulty in executing well.
Adjusting a portfolio within time and space (the types of investment used) seems even harder. (Been watching too much Dr. Who.) The manager has to make accurate macro calls along with correct timing.
[using go-anywhere funds] makes even planning for a target asset allocation problematic
I'm happy giving managers broad discretion (within their areas of expertise) but not unfettered freedom. If my wide ranging managers make decisions that perturb my overall allocations, I defer (within broad limits) to their judgments on where one is best invested. Why should I insist on constraining my portfolio to some static allocation, give or take 5%? Why is that the "right" allocation for me, whatever those percentages are? I just shoot for the side of a barn.
Here's a thread from seven years ago on the same topic. Ted did include PRPFX among funds he considered to be go-anywhere. I especially liked Bitzer's observation that may sum up the whole ball of wax:
My "go anywhere" funds have historically gone to the wrong places.
https://www.mutualfundobserver.com/discuss/discussion/31272/go-anywhere-fund
My personal criteria for GA success is beating a VWELX or Vanguard Balanced with a equal or higher Sortino for rolling 3Y periods over more than 20Y.
I think MRFOX was recently added at Fidelity.
It is not a bad idea to create your own GA fund. I created one by transferring a fixed $ amount to a newly created brokerage account at an existing brokerage relationship. I never add more money to it even when it was doing so much better than the rest of my portfolio. I just exercise more discipline with that account. That account also shows to me what I am doing wrong with the rest of my portfolio (mostly lack of discipline!).
I ran a MFO screen with params: Age > 20 years, Sortino > 1.00, Lipper Preservations >= 4, 3Y Roll Avg >= 10 and was surprised to see 47 as the result count.
No Allocation or Alts in the results though
I will send you a PM. Thanks.
https://www.msn.com/en-us/money/other/this-go-anywhere-find-beats-99-of-its-peers-what-it-s-buying-now/ar-AA1jWToe
https://www.barrons.com/articles/go-anywhere-find-beats-99-of-peers-6547f85a?st=8rdelydow754xaa
Oddly enough, this came up in some searching I was doing in the past couple of days to help someone find a temporary alternative to VSMGX (hard to get w/o fees outside of Vanguard). I wound up suggesting GAL rather than GAA.
You might take a look at VSMGX as well, though this fund is, as @hank so nicely put it, a "go nowhere" fund.
One can also emulate VSMGX using Vanguard ETFs of the same (or equivalent) funds, with Fidelity's basket portfolio service. One click rebalancing for those who don't want to have any involvement with their investments. (Not for me, for a friend
This service costs $60/year (or you can rebalance on your own). Using the cheaper ETFs rather than the funds in VSMGX, this comes out cheaper than VSMGX for balances above $70K. And it has the benefit that if you need money at a time that the stock market is down, you can tap the bond funds separately. You can't do that with an allocation fund.
Portfolio Visualizer comparison: ETF basket, GAL, and GAA, benchmarked against VSMGX.
I tossed out little known GAA as worth a look. Not a recommendation. Cambrea has some whacky funds (TOKE). You could have lost your shirt in more than one. Small shop. Largely run by podcast celebrity Meb Faber. Those are meant as disclaimers!
M* rates GAA neutral and faults the management team as too thin / too concentrated in one hand, The 53.7 Ml asset base is another issue, though there is no sign it will close. The .40% ER covers the costs incurred from the mostly actively managed funds it invests in (several in-shop / a few from outside).
Personally, I wanted something in a conservative balanced fund (about 40% fixed income) that goes “off the track” and invests where many others do not. The fund is overweight commodities relative to peers. A bit over half the equity position is non-U.S. It acts as if there’s some precious metals in there. Includes some EM. Quite a bit in Asia. Also in Europe. There are some short positions. One of the funds it invests in employs a momentum strategy.
The 5 year record is modest. This one won’t make you rich. Designed for conservative investors, Should outperform cash longer term. I’m comfortable throwing an equal portfolio weight (10%) into it and letting it ride. (I’ve also enjoyed listening for hours to more than a dozen of Faber’s radio podcast interviews with many different investment professionals.)
This is not a recommendation.