My 1099-DIV tax form shows that most distributions from bond mutual funds are characterized as nonqualified dividends. If I am correct nonqualified dividends, similar to short-term capital gain distribution, are taxed as ordinary income and cannot be offset by investment loses, that makes them very disadvantageous for investors. Examples of such funds: PONDX, RSIVX , LSBRX, DSL, and bond portion of balanced funds PRWCX, VWINX.
Please explain whether it is always the case for bonds funds or I miss something.

2-3-15
0.00 RSIVX - RiverPark Strategic Income
0.33 PONDX - PIMCO Income
Dr. Dave,
While only one day, this is a rather large percentage difference between two "Multisector Bond Funds" that you feel should be compared to each other.
Since I see by your post that you fully embraced and learned from fundalarm's, would you tell us why RSIVX was flat on the day and PONDX was up 1/3rd of a percent?
Hint: Look under the hood.

@Mona, thanks for that info. These are not funds that I watch so I am at a disadvantage here. Interesting that they both have a go anywhere kind of mandate but seem satisfied to stay put where they are. The intrincities of bond funds always confuse me. Thanks again for the enlightenment.

Hi again,
The mandates of each fund have different perimeters. And, RSIVX and PONDX operate, as you correctly observed, in two different spaces. It is for these reasons the two should not be compared, simply because Morningstar categorize both as Multisector Bonds Funds.
Apples and oranges are both fruit, but they do not taste similar to me.
Best Regards,
Mona

@JC, is it not that their principles are more or less 'go anywhere' / opportunistic?

On first glance these funds look very similar. I went to the prospectus of each fund.
There are a few details like the allocation percentages that are different. The issue with comparing these funds is that they are like oil on water. RSIVX is currently holding a lot of corporate instruments. https://fundresearch.fidelity.com/mutual-funds/composition/76882K751?type=o-NavBar
PONDX is spread out over the spectrum. https://fundresearch.fidelity.com/mutual-funds/composition/72201F458?type=o-NavBar
Pimco is well known for buying derivative instruments which would increase volatility.
The category "Multisector Bond" is general. But, I am splitting hairs here. Yes it could be said that these funds are similar. The background heritage and investing style of the fund companies themselves might be the biggest difference here and one that should be noted as I did with the derivatives issue.

Hi John,
1. "On first glance these funds look very similar" - Not to me, but I can see why to some.
2. "There are a few details like the allocation percentages that are different. The issue with comparing these funds is that they are like oil on water".
3. Why is comparing these funds "like water on oil"?
A. The allocation percentages are very different and always have been.
B. "RSVIX is currently holding a lot of corporate instruments (and historically has)"
C. "PONDX is spread out over the spectrum (and always has been)"
D. "Pimco is well known for buying derivative instruments which would increase volatility (and always has been)"
So based on your description, what does RSIVX and PONDX have in common?
Morningstar incorrectly categorizes both as Mulisector Bond Funds. All one needs to do is read the prospectus of each, as you have done, to conclude "The issue with comparing these funds is that they are like oil on water"
Best Regards,
Mona

@JC, is it not that their principles are more or less 'go anywhere' / opportunistic?

On first glance these funds look very similar. I went to the prospectus of each fund.
There are a few details like the allocation percentages that are different. The issue with comparing these funds is that they are like oil on water. RSIVX is currently holding a lot of corporate instruments. https://fundresearch.fidelity.com/mutual-funds/composition/76882K751?type=o-NavBar
PONDX is spread out over the spectrum. https://fundresearch.fidelity.com/mutual-funds/composition/72201F458?type=o-NavBar
Pimco is well known for buying derivative instruments which would increase volatility.
The category "Multisector Bond" is general. But, I am splitting hairs here. Yes it could be said that these funds are similar. The background heritage and investing style of the fund companies themselves might be the biggest difference here and one that should be noted as I did with the derivatives issue.

@Mona:
>> comparison between RSIVX with PONDX is useless. They are two different animals. If you want to compare RSIVX with another primarily high yield fund ....
Gosh, you'd better tell M*, which categorizes them identically and also benchmarks them identically --- and not high yield.

After just now reading DS, I am looking at RSIVX and comparing it with PONDX and PDI. DODIX looks good recently too. Thoughts about those?

A comparison between RSIVX with PONDX is [probably not productive]. They are two different animals. If you want to compare RSIVX with another primarily high yield fund, use OSTIX

After just now reading DS, I am looking at RSIVX and comparing it with PONDX and PDI. DODIX looks good recently too. Thoughts about those?

Thanks, Mike. Frankly, I'd forgotten it is once again time to start looking for these reports. As a holder who continues to build position in RSIVX, I was pleasantly surprised to see that this fund does have the ability to play some pretty good defense (as demonstrated in 2H2014), without compromising yield.
For those not invested with Sherman, but who are paying increasing attention to HY debt re. oil and gas credits, there may be some material here that would hold your interest. Several pages are devoted exclusively to this topic, and it is used as the core topic around which a broader discussion of HY credits and RSIVX investments is elaborated.

After being noticably quiet with regards to their shareholder communications, RSIVX has put out a 20 page shareholder letter. Enjoy!
http://www.riverparkfunds.com/downloads/News/4Q2014_RiverPark-Cohanzick_Shareholder_Letter.pdf
Mike_E

Last week I sold out my EVBAX shares and split the proceeds between RSIVX and ARTFX.

Here is an update about the recent performance of ICMUX. Per M*, its performance since 8/31/14 and the performance of some other funds mentioned in this thread are as follows:
ICMUX: -4.4%
RPHYX: +0.3%
RSIVX: -0.8%
DLINX: -0.6%
M* High Yield Bond Index: -4.4%
Per M*, ICMUX has an effective duration of only 1.19 years and has 34% allocated to cash. But, its loss since 8/31/14 is as great at M*'s high yield bond index!
Looking at their holdings, there is a substantial allocation to the energy sector including the top two holdings. This probably explains the size of the loss.
Perhaps this fund will rebound quickly and demonstrate the difference between volatility and risk. Allocating some of their cash at the right time could help.
But, recent performance suggests ICMUX is a market cycle fund and not a fund for someone looking for a smooth ride and an easy exit if the need might arise to sell shares in a relatively short period of time.

@JohnChisum
Thanks for the link to dailyalts.com. Looks interesting, and I have bookmarked this site.
Right here, right now, with domestic equities fully valued, developed foreign equities in a definite funk, and interest rates destined to increase over the next 12 months, I would have no problem owning a 10-20% position in Alts -- as long as they continue to perform. At this time, we own a 10% position in PQTIX (investor ER 1.15%), and I am considering the purchase of a 10% position in QLEIX (investor ER 1.39%).
@Junkster
Conditions like 2008 will inevitably occur in the future, and just like in 2008, common investors like us -- who likely overestimate our abilities -- and the "professionals" will be caught by surprise.
I continue to think that investors can obtain adequate downside protection with a wise mix of relatively low-cost equity, balanced and bond OEFs/ETFs, such as: MOAT, RPV, SCHD, VDIGX, VASVX, VSTCX, VMNVX, SPLV, EFAV, TOLSX, GLFOX, DODGX, DODFX, DODWX, DODBX, PRWCX, VWENX, HBLIX, WHGIX, VWIAX, PIMIX, PIGIX, MWTIX, DBLFX, DBLTX, DBLEX and RSIVX . But I remain open to relatively low-cost alternative funds, such as PQTIX, QLEIX, AQRIX, LMAPX, CRUMX, and even BG's JUCIX. As for the Alts, I am willing to be very, very patient, and track and track, and resist the temptation to be an early investor, but if the Alt fund continues to impress, I am willing to pull the trigger and buy.
Kevin

At 5:35pm PST it looks as if M* finally caught up to Google, except for ARTGX, which is down 55¢ because of a distribution today.

M*
.INX 	2048.72	OK	-	
ABNDX 	12.75	OK	-	AF
AIBAX 	13.53	OK	-	AF
AHITX 	10.99	OK	-	AF
ABALX 	26.11	OK	-	AF
ANCFX 	55.54	OK	-	AF
SMCWX 	49.47	OK	-	AF
CWGIX 	47.28	OK	-	AF
ANEFX 	39.97	OK	-	AF
TAFTX 	17.73	OK	-	AF
AMHIX 	15.45	OK	-	AF
AMCPX 	29.69	OK	-	AF
ACMVX 	17.8	OK	-	AC
TWSMX 	7.59	OK	-	AC
ABHIX 	6.02	OK	-	AC
BUFBX 	14.87	OK	-	
PRBLX 	41.09	OK	-	
VVPSX 	19.3	OK	-	
GABAX 	68	OK	-	
MAPIX 	15.62	OK	-	
LSBRX 	15.42	OK	-	
SFGIX 	11.52	OK	-	
MFLDX 	16.47	OK	-	
GASFX 	31.2	OK	-	
ARTGX 	16.05	Error	No Update	
RSIVX 	10.23	OK	-	
RPHYX 	9.95	OK	-	
WAFMX 	3.23	OK	-	
GPROX 	12.71	OK	-	
SCHD 	40.19	OK	-	

As you can see, at 4:15pm PST google has it's act together. M* certainly does not. Note the unevenness even within the AF (American Fund) and AC (American Century) fund families.

M*		
.INX 	2048.72	OK	-
ABNDX 	12.75	OK	-		AF
AIBAX 	13.53	OK	-		AF
AHITX 	10.99	OK	-		AF
ABALX 	26.11	OK	-		AF
ANCFX 	55.6	Error	No Update	AF
SMCWX 	49.7	Error	No Update	AF
CWGIX 	47.38	Error	No Update	AF
ANEFX 	39.97	OK	-		AF
TAFTX 	17.72	Error	No Update	AF
AMHIX 	15.44	Error	No Update	AF
AMCPX 	29.81	Error	No Update	AF
ACMVX 	17.84	Error	No Update	AC
TWSMX 	7.59	OK	-		AC
ABHIX 	6.04	Error	No Update	AC
BUFBX 	14.87	OK	-	
PRBLX 	41.21	Error	No Update	
VVPSX 	19.37	Error	No Update	
GABAX 	68	OK	-	
MAPIX 	15.62	OK	-	
LSBRX 	15.42	OK	-	
SFGIX 	11.52	OK	-	
MFLDX 	16.47	OK	-	
GASFX 	31.08	Error	No Update	
ARTGX 	16.05	Error	No Update	
RSIVX 	10.23	OK	-	
RPHYX 	9.95	OK	-	
WAFMX 	3.23	OK	-	
GPROX 	12.71	OK	-	
SCHD 	40.19	OK	-	

Perhaps M* isnt the only one with reporting issues. Yesterday, after 8:00 pm PST, I updated my spreadsheet using Google Finance. I happened to check Google again a few minutes ago, and look at the discrepancies! I also happened to download the same report from M* yesterday, again after 8:00pm local. Note that yesterday's M* agrees with "today's" Google posting:

Was:	Now:		M*
ABNDX 	12.76	12.76	OK	12.76
AIBAX 	13.53	13.54	Error	13.54
AHITX 	11.11	11.04	Error	11.04
ABALX 	25.96	26.04	Error	26.04
ANCFX 	55.23	55.32	Error	55.32
SMCWX 	49.73	49.35	Error	49.35
CWGIX 	47.01	46.99	Error	46.99
ANEFX 	39.85	39.85	OK	39.85
TAFTX 	17.74	17.73	Error	17.73
AMHIX 	15.46	15.45	Error	15.45
AMCPX 	29.71	29.58	Error	29.58
ACMVX 	17.75	17.74	Error	17.74
TWSMX 	7.58	7.57	Error	7.57
ABHIX 	6.08	6.05	Error	6.05
BUFBX 	14.81	14.87	Error	14.87
PRBLX 	40.92	40.92	OK	40.92
VVPSX 	19.53	19.29	Error	19.29
GABAX 	67.72	67.73	Error	67.73
MAPIX 	15.69	15.62	Error	15.62
LSBRX 	15.42	15.45	Error	15.45
SFGIX 	11.53	11.45	Error	11.45
MFLDX 	16.56	16.43	Error	16.43
GASFX 	31.11	31.01	Error	31.01
ARTGX 	15.89	15.95	Error	15.95
RSIVX 	10.24	10.25	Error	10.25
RPHYX 	9.94	9.95	Error	9.95
WAFMX 	3.24	3.23	Error	3.23
GPROX 	12.82	12.71	Error	12.71
SCHD 	40.01	40.1	Error	40.01

WTF!!

Short term bonds vs Savings/checking accounts for cash..the difference is like 1% and no safety....are they worth it?

Completely agree. Even RPHYX and RSIVX I'm viewing as just any other fund holding. Not exactly a substitute for cash.

@Vert.
It's because of the way they handled ICMYX.
They merged it into ICMUX this past January and touted the reduction in fee.
ICMUX, which only dates back about 4 years, is a Great Owl Fund.
Top quintile performer. Max drawdown only -1.4% (September 2011).
Folks on the board have compared it to David Sherman's conservative funds (RPHYX and RSIVX).
All good right?
Except ICMYX was actually the oldest share class with about 7 years performance.
And, it contained performance for a steady-eddy income fund that would be disconcerting for very conservative investors.
It drew down -14.6% in November 2008.
Here's current performance snap shot from their website:

Note the inception date of Intrepid Income. Performance before August 2010 does not appear, since it was in the different share class.
To their credit, they do show the earlier quarterly performance in the fund's summary prospectus.
But most fund screening tools and performance plotters (eg. M*) will just not pick this up.
As if the poor performance never happened.
I think it's borderline non-disclosure, calling into question the firm's integrity. So, hard for me to recommend.
Maybe this stuff is common practice and I'm being too critical.
Just does not seem right.

Let's not compress everything into one lousy week. For instance, YTD:
WAFMX: +4.8%
RHYPX: +1.8%
RSIVX: +4.2%
GASFX: +10.7%
LSBRX: +4.2%
AMHIX: +13.2%
ACMVX: +4.5%
PRBLX: +2.9%
Figures are from yesterday, for the most part.
Those are some of mine that are doing OK, and yes, I have another whole bunch that aren't.

http://www.riverparkfunds.com/Funds/GargoyleHedgedValue/Performance.aspx
"The performance data quoted for periods prior to April 30, 2012 is that of the Predecessor Fund. The Predecessor Fund commenced operations prior to the periods shown. The Predecessor Fund was not a registered mutual fund and was not subject to the same investment and tax restrictions as the Fund. If it had been, the Predecessor Fund's performance might have been higher. Performance shown for periods less than one year is cumulative; periods of one year and greater are annualized. Inception Date of the Predecessor Fund is 12/31/1999."
They used to have a chart listing every quarterly return back to 1999 (i.e. they were fully transparent and owned-up to all returns, both good/bad) on their website, here:
http://gargoylegroup.com/overview&pid=96
Unfortunately, this site has recently undergone a significant re-do and I can't find the data anymore (albeit, I may be having a senior moment and am missing it).
David had a web conference call with the managers not too long ago, and a caller during Q&A did ask, specifically, about Q4 2008; "my take" on it is based on their rather evasive response. Frankly, I think they at least relaxed their hedges, in Sept 2009, thinking the correction was over (when if fact it had just begun), piled into financials for the juicy dvds, and then got their weenies caught in the wood chipper. In short, they may have "pulled a Bill Miller."
That said, I do think the managers are honest, hardworking guys, and their record prior to that awful call was pretty impressive (and what attracted David S. to it). I shouldn't have come off so snippy. If it does well in the next big downturn, I'd like to make it work in concert with my RSIVX holding, a position I'm currently building ... cautiously. Really.