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Can anyone tell me the which months over the last year David ( I think he was the only one ) had a write up in the commentaries on the Cash Rich Funds. I found only one months discussion, but I know there were more. TIA Richard
There is also a very good article in the January 2014 MFO on cash rich funds, with the market hitting new highs these funds mandate a close look. Good luck, Lukemon
To access the January 2014 article go to the Home page, go to the right, find Issues: long scroll page, select January 2014 and then page down to Voices from the bottom of the well
Thanks for the link, PRESSmUP. @golub1, why not just raise some cash on your own? I find it hard to believe that most of these cash-heavy guys are really brilliant enough to use that cash at just the right the time, again and again. If they were, they wouldn't be running OEMs for relative pennies compared to what the hedgies earn. Even the market timers with the best long-term records, like FPACX, have barely topped a simple 60/40 index fund like VBINX -- what happens when they finally get a big call wrong? Or when current management retires?
Better, I think, to just keep 20 or 40 or 60% cash or short-term Treasuries or whatever makes you comfortable, then rebalance every quarter or year to keep that number in line. There are clearly a few guys out there (though not many) who know how to pick a slightly higher proportion of good stocks than bad, but market timing is far harder.
But I fear I've opened up a philosophical discussion here...
Hi expatsp. Philosophical? Probably not that deep. Just a matter of individual preference and/or comfort. Re-balancing index type funds or ETFs has a lot of followers and detractors as does using 'risk adjusted' return managed funds like FPACX (which fwiw I don't own now but did a few years ago). I also question as you do that many managers can consistently utilize and adjust there cash levels to beat index funds, but I do not question my ability to do so. I know I can't.
A few funds I own for the purpose of the manager or management team making asset allocation, buying within a companies capital structure or making cash holding decisions are SFGIX, FMIJX, SGENX, ICMBX, PRWCX. I think the managers of these funds can obtain good "risk adjusted" returns.
PRESSmUP, thanks that was the write up I was looking for. One of the disheartening things about these cash rich funds is that many have very high ER's. It seems to me that the cash assets should be at the a lower ER that the stocks portion of the portfolio.
Comments
Regards,
Ted
Derf
http://www.mutualfundobserver.com/2016/05/
Better, I think, to just keep 20 or 40 or 60% cash or short-term Treasuries or whatever makes you comfortable, then rebalance every quarter or year to keep that number in line. There are clearly a few guys out there (though not many) who know how to pick a slightly higher proportion of good stocks than bad, but market timing is far harder.
But I fear I've opened up a philosophical discussion here...
A few funds I own for the purpose of the manager or management team making asset allocation, buying within a companies capital structure or making cash holding decisions are SFGIX, FMIJX, SGENX, ICMBX, PRWCX. I think the managers of these funds can obtain good "risk adjusted" returns.
Intrepid Endurance (formerly Intrepid Small Cap, ICMAX) - absolute value which means huge cash holdings until compelling valuations appear. Up 4% YTD despite 67% cash which implies that equity portion was up 12%. Lost 18% in the 2007-09 crash.
http://www.mutualfundobserver.com/discuss/discussion/comment/77466/#Comment_77466
Yes Indeed!
3Q 2016 Fact Sheet
ICMAX ICMZX September 30, 2016
SECTOR allocation (% of net assets)
Cash Equivalents and Other 79.5%
Industrials 5.4%
Materials 4.7%
Information Technology 3.6%
Consumer Discretionary 3.3%
Financials 2.3%
Health Care 1.2%
http://www.intrepidcapitalfunds.com/media/Intrepid_Endurance_Fund_3Q16.pdf
Fact Sheets and 3rd Q Manager Commentaries
http://www.intrepidcapitalfunds.com/funds/fact_sheets.html