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Question for David Snowball and others about RSIVX
I was wondering if you still own RSIVX and what percentage of your portfolio is invested in it. Also what are your thoughts of RSIVX going forward? Thanks!
@3yards nope, got out of it early in 2015. I have a toehold in RPHYX. PTIAX (mentioned here by someone) seems to be much steadier...that's where I've put my cash after selling all of RSIVX.
Never owned it. And certainly would not own it as a cash substitute. I would compare it to OSTIX, not exactly the same, but both use very short-term bonds. For this kind of bond fund, I would bet on OSTIX manager Kaufman for the long run. If I want a cash substitute, NEARX has done a remarkable job.
I will keep an eye on PTIAX and NEARX. I currently own OSTIX in my Roth IRA as well as RSIVX. I would love to buy RPHYX, but it looks like it will be closed for the next 100 years...
RISVX - down 4.18% -- for 2015-- including re invested div. & cap gain. I.m still holding while looking for a replacement, Vanguard to launch " core bond fund" in March 2016, so I'll hang on to risvx till then.
I sold this dog several months ago, when there were stories about its having bought troubled debt. It's down 6.3% since this year's high. Good riddance!
RSIVX is currently my worst performing fund for 2016 (bond or stock fund). It went down .44% yesterday, none of my other funds came close. I've owned the fund since Dec. 2013 and I'm down 1.5%. I could do better in cash. At least I would break even. I'm starting to wonder if there is any point in owning this fund? I am still curious if David Snowball still owns the fund, but he snubbed me when I originally presented the question. Should I continue to hold this fund?
I sold it last year and moved to PTIAX. A multisector bond fund that has been around at least 5 years with high returns and below average risk. Happy with this one.
And that's what I was hoping for with RSIVX. RSIVX is a pretty good example of a group-think fund, I believe. Why gamble with a fund with little to no tract record? Because the manager did well with another new fund, RPHYX? And that manager gets rave reviews here. But as it turns out, that doesn't mean very much.
By the time I'm dead, I plan to make every investment mistake possible, but hopefully fewer in-between as I learn along the way. This was mistake number 128 if we're keeping tract
Thank you very much for bringing PTIAX to my attention, MikeM! I will definitely do more research on this fund. I also appreciate your explanation and your humor! You have a great outlook to investing!
@BenWP , when you mentioned the TF for PTIAX, I had to go back and look at my purchase history. I'm with Schwab also. I was pretty sure one reason I bought was because it was NTF. Sure enough, my history shows I did not pay a TF, and that was only a couple months ago. I do see now there is a $76 TF on the buy. Very strange.
Here's my fundamental problem: I'm concerned that the market is currently forked up. Really. Zero and negative interest rate policies fundamentally distort investors' allocations. Why are interest rates at or below zero? Because, despite falling unemployment, global growth is at or below zero. We're about to register a fourth consecutive quarter of falling year-over-year earnings (Factset, March 2016). And still the stock market is rising at above average rates over the past three years; VTSMX is up 11% annually in that period. At the base of the market trough in February 2016, valuations were higher (at least in small caps, maybe broadly) than they were at the peak preceding the 2007 crash. The liquidity available to fixed income market makers is down by 90% since the end of the crisis. In theory, those guys provide the circuit breaker in a falling market: if you want to sell a share of Google, they'll buy it immediately then sell it as quickly as they can find an ultimate buyer for it which pocketing a few bps for their trouble. In the absence of that sort of liquidity, selloffs accelerate.
That's relevant here because I'm reluctant to make too strong an argument against what appears to be a sensible strategy that's performing poorly in a senseless market, especially when the manager has reasonable arguments about the malformations in the market. Similarly, I'm about to buy a small cap fund that's 50-80% cash and that most of you folks think of as appropriate for the Thanksgiving table.
In short, I own RSIVX personally and in an account for MFO. The positions aren't huge, but then none of mine are. I'm not happy that the strategy has been losing money over the past several quarters but I'm also not selling based on that experience nor am I willing to say that the strategy is a bad one. I am pretty happy with RPHYX (up 1% YTD) which continues to be a low-vol alternative to cash for me.
@MikeM: My bad. I just checked my Schwab transaction. I bought PTIAX on Dec 21 and paid no TF. When I wanted to add to the position, I discovered the fee and was surprised and kicked myself for what turned out not to be a mistake. I'm really cheap and hate those fees. I think Performance Trust modified its deal with Schwab for 2016.
@BenWP , when you mentioned the TF for PTIAX, I had to go back and look at my purchase history. I'm with Schwab also. I was pretty sure one reason I bought was because it was NTF. Sure enough, my history shows I did not pay a TF, and that was only a couple months ago. I do see now there is a $76 TF on the buy. Very strange.
MikeM,
Same here. I purchased on January 23rd and the was no TF.
But David, your last paragraph is again saying your happy with RPHYX, insinuating that RSIVX having the same manager must mean RSIVX will be good too. It hasn't been. Your also saying that the sound strategy is being negatively influenced by the un-sound market. Heck, Hussman has been saying that for years (not to insinuate this manager is as bad as Hussman in allocating money). I just think good managers can come up with good investment theories, but it doesn't mean they'll work in real life. This fund may turn out to have great 5 year risk adjusted returns. But why not wait until proven? So far not so good.
P.S. if I could get into RPHYX I would. Proof is in the pudding.
PTIAX Corrected per heezsafe Total Assets Dec 31 Fact Sheet $223.02 mil Total Assets March 23, 2016 per M* $ 370.3 mil 66 % increase in assets under management. Y T D Management probably thought Who needs These ?'12B-1 Fee'
BREAKING DOWN '12B-1 Fee' Back in the early days of the mutual fund business, the 12b-1 fee was thought to help investors. It was believed that by marketing a mutual fund, its assets would increase and management could lower expenses because of economies of scale. This has yet to be proved. With mutual fund assets passing the $10 trillion mark and growing steadily, critics of this fee, which today is mainly used to reward intermediaries for selling a fund's shares, are seriously questioning the justification for using it. As a commission paid to salespersons, it is currently believed to do nothing to enhance the performance of a fund. Read more: 12B-1 Fee Definition | Investopedia http://www.investopedia.com/terms/1/12b-1fees.asp#ixzz43ljR5V55 Follow us: Investopedia on Facebook
From November Discussion Here's my response to RSIVX, In My Schwab I R A PTIAX was a $5000.minimum @ Schwab now $100 (see Ted's post here;" Schwab Slashes Minimums On OneSource NTF Mutual
PTIAX is no longer a Mutual Fund OneSource® fund. Now (Minimum: $5,000.00 Additional $500.00) with transaction fee. @MikeM and @BenWP It was great @ Schwab while it lasted !
>> At the base of the market trough in February 2016, valuations were higher ... maybe broadly ... than they were at the peak preceding the 2007 crash.
Thanks so much David_Snowball for providing some valuable and interesting insights about RSIVX! Like MikeM, I would have loved to get into RPHYX, but since that wasn't an option, I decided to puchase RSIVX in order to get exposure to another David Sherman fund based on my research at the time.
I appear the only person incapable of posting an image to the discussion board. I keep trying and keep getting the broken-image icon. The best I can do is a link to a composite valuation graph. Grantham argues that the two standard deviation line is the threshold for major reversals. Market values exceeded that only once (and housing values once) in 100 years.
David- perhaps you are attempting to transfer a "URL" to the image gizmo. That won't work- your browser should have a "copy image location" command (or some command with similar wording). For example the FireFox browser accesses that command by using the mouse right-button. Put the pointer over the desired image itself, use the "copy image location" or equivalent, go to MFO, and paste that into the image gizmo in the comment box header.
Additional note- I've encountered a very few images which won't work in this manner due to their embedding or formatting.
Always happy to weigh in on matters I know nothing about
"Three Yards and a cloud of dust" (Woody Hayes) is a great handle - perhaps applicable to some investment styles.
Not clear to me from the discussion is that RSIVX looks like a junk bond fund. M* puts the sub-BBB holdings at around 75% (if I'm seeing it right). Most of the remaining 20+% are BBB rated (investment grade with some speculative characteristics). Junk's been a dicey area recently depending on the sector and tier. Lower quality hasn't fared well. I suspect even the brightest of managers might have easily been tripped up in the recent environment, and so I would be slow to cast blame.
Lost in discussion, seems to me, is What do the holdings within this fund add to one's overall portfolio strength or attributes? I'm not one who believes every asset owned needs to rise all the time. The concept behind diversification, seems to me, is that in any given environment, some holdings rise and others fall. (Obviously, winners should outnumber losers over time.) I wouldn't buy this fund. I expect better, more experienced junk bond managers can be had for lower cost. In fact, I haven't felt a compelling reason to own junk bonds for some time.
Thanks guys for the lively discussion. Time to go run the snowblower.
Comments
I.m still holding while looking for a replacement, Vanguard to launch " core bond fund"
in March 2016, so I'll hang on to risvx till then.
And that's what I was hoping for with RSIVX. RSIVX is a pretty good example of a group-think fund, I believe. Why gamble with a fund with little to no tract record? Because the manager did well with another new fund, RPHYX? And that manager gets rave reviews here. But as it turns out, that doesn't mean very much.
By the time I'm dead, I plan to make every investment mistake possible, but hopefully fewer in-between as I learn along the way. This was mistake number 128 if we're keeping tract
Regards,
Ted
Sorry, not trying to snub anybody.
Here's my fundamental problem: I'm concerned that the market is currently forked up. Really. Zero and negative interest rate policies fundamentally distort investors' allocations. Why are interest rates at or below zero? Because, despite falling unemployment, global growth is at or below zero. We're about to register a fourth consecutive quarter of falling year-over-year earnings (Factset, March 2016). And still the stock market is rising at above average rates over the past three years; VTSMX is up 11% annually in that period. At the base of the market trough in February 2016, valuations were higher (at least in small caps, maybe broadly) than they were at the peak preceding the 2007 crash. The liquidity available to fixed income market makers is down by 90% since the end of the crisis. In theory, those guys provide the circuit breaker in a falling market: if you want to sell a share of Google, they'll buy it immediately then sell it as quickly as they can find an ultimate buyer for it which pocketing a few bps for their trouble. In the absence of that sort of liquidity, selloffs accelerate.
That's relevant here because I'm reluctant to make too strong an argument against what appears to be a sensible strategy that's performing poorly in a senseless market, especially when the manager has reasonable arguments about the malformations in the market. Similarly, I'm about to buy a small cap fund that's 50-80% cash and that most of you folks think of as appropriate for the Thanksgiving table.
In short, I own RSIVX personally and in an account for MFO. The positions aren't huge, but then none of mine are. I'm not happy that the strategy has been losing money over the past several quarters but I'm also not selling based on that experience nor am I willing to say that the strategy is a bad one. I am pretty happy with RPHYX (up 1% YTD) which continues to be a low-vol alternative to cash for me.
As ever,
David
Same here. I purchased on January 23rd and the was no TF.
Mona
P.S. if I could get into RPHYX I would. Proof is in the pudding.
Corrected per heezsafe
Total Assets Dec 31 Fact Sheet
$223.02 mil
Total Assets March 23, 2016 per M*
$ 370.3 mil
66 % increase in assets under management. Y T D
Management probably thought Who needs These ?'12B-1 Fee'
BREAKING DOWN '12B-1 Fee'
Back in the early days of the mutual fund business, the 12b-1 fee was thought to help investors. It was believed that by marketing a mutual fund, its assets would increase and management could lower expenses because of economies of scale. This has yet to be proved. With mutual fund assets passing the $10 trillion mark and growing steadily, critics of this fee, which today is mainly used to reward intermediaries for selling a fund's shares, are seriously questioning the justification for using it. As a commission paid to salespersons, it is currently believed to do nothing to enhance the performance of a fund.
Read more: 12B-1 Fee Definition | Investopedia http://www.investopedia.com/terms/1/12b-1fees.asp#ixzz43ljR5V55
Follow us: Investopedia on Facebook
From November Discussion
Here's my response to RSIVX, In My Schwab I R A
PTIAX was a $5000.minimum @ Schwab now $100 (see Ted's post here;" Schwab Slashes Minimums On OneSource NTF Mutual
http://www.mutualfundobserver.com/discuss/discussion/comment/71734/#Comment_71734
PTIAX is no longer a Mutual Fund OneSource® fund.
Now (Minimum: $5,000.00 Additional $500.00) with transaction fee.
@MikeM and @BenWP
It was great @ Schwab while it lasted !
Doesn't look like it, quite, but hard to tell :
http://www.multpl.com/shiller-pe/
(366-223)/223 x 100= 93% ?
Hmmmmm...... time to change the batteries, maybe?
Additional note- I've encountered a very few images which won't work in this manner due to their embedding or formatting.
"Three Yards and a cloud of dust" (Woody Hayes) is a great handle - perhaps applicable to some investment styles.
Not clear to me from the discussion is that RSIVX looks like a junk bond fund. M* puts the sub-BBB holdings at around 75% (if I'm seeing it right). Most of the remaining 20+% are BBB rated (investment grade with some speculative characteristics). Junk's been a dicey area recently depending on the sector and tier. Lower quality hasn't fared well. I suspect even the brightest of managers might have easily been tripped up in the recent environment, and so I would be slow to cast blame.
Lost in discussion, seems to me, is What do the holdings within this fund add to one's overall portfolio strength or attributes? I'm not one who believes every asset owned needs to rise all the time. The concept behind diversification, seems to me, is that in any given environment, some holdings rise and others fall. (Obviously, winners should outnumber losers over time.) I wouldn't buy this fund. I expect better, more experienced junk bond managers can be had for lower cost. In fact, I haven't felt a compelling reason to own junk bonds for some time.
Thanks guys for the lively discussion. Time to go run the snowblower.