Re: “Add Safety by Venturing Abroad”
Title’s a bit misleading. Try and find a prospectus for any foreign or global bond fund that doesn’t mention the increased risks of owning foreign bonds.
I’ve always allocated a small chunk to foreign bonds (5-10% of portfolio), mainly because I don’t trust the Fed and politicians to protect the buying power of the USD. Nice to have some foreign bonds just in case of a dollar rout. I’d hazard a guess that my foreign bond exposure over several decades has produced a somewhat better return than the domestic side has. But too many variables to pin down the advantage.
One variable is that more often than not your foreign bond fund is (fully or partially) hedged back to the U.S. dollar to reduce the volatility introduced by exchange rates. Another variable is the credit quality of the bonds owned. And a third is duration. Fees can be very high as well on foreign bond funds. A big variable is ability of manager to get the valuation / macro picture right and shift funds from country to country. TRP, IMHO, hasn’t been particularly successful at that over the years.
One fund I’ve owned before that doesn’t hedge back to the dollar is PRELX. But I haven’t been too impressed since it came out. Have been tempted to pick some up recently because it’s down a bit this year and probably due for some kind of rebound. However, a counter argument is that the EM bond market usually suffers when U.S. equity markets correct. So, it might be better to wait longer until the current U.S. stock euphoria wears thin.
An alternative to foreign bonds would be to invest directly in foreign currencies. Gets rid of interest rate risk. PRPFX does this to some degree and therefore benefits on days when the dollar is weak. Personally, about 10% of my portfolio is in DODLX. To be clear - this is a global bond fund, and often holds around 50% in domestic bonds, along with the international. The fund also dabbles a bit (5-10%) in the EM bond sector - adding incremental return without going off the reservation. With any bond fund, you want low fees, as fees consume a larger share of potential gains with bond funds. D&C does a decent job limiting expenses on all their funds.

@Baseball_Fan
Since everything is liquidated & in cash now, it would seem distribution should be straight forward & your figures seem about right unfortunately.
Also unfortunately, they are still recalculating NAV as of February 18 as well as all past NAVs for the past 2 years or more. So who knows what those numbers will be & when that distribution will occur.
And then there is the matter of "reserves".
This is their latest FAQ page dated April 8.
It might end up being more like a 50% loss, at least initially. But they did mention that there might be a second distribution as well.
Then there are the lawsuits- class action against the fund, Infinity Q Capital Management, and specific individuals responsible and also any potential lawsuit on behalf of the fund against Infinity Q Capital Management to recoup costs incurred through this whole process.
@wxman123
What SIPC Protects

SIPC protection is limited. SIPC only protects the custody function of the broker dealer, which means that SIPC works to restore to customers their securities and cash that are in their accounts when the brokerage firm liquidation begins.
SIPC does not protect against the decline in value of your securities. SIPC does not protect individuals who are sold worthless stocks and other securities. SIPC does not protect claims against a broker for bad investment advice, or for recommending inappropriate investments.
It is important to recognize that SIPC protection is not the same as protection for your cash at a Federal Deposit Insurance Corporation (FDIC) insured banking institution because SIPC does not protect the value of any security.

But there is at least one firm advertising to sue your broker if they recommended IQDAX.

https://www.financial-planning.com/list/bond-funds-with-the-best-15-year-returns
Bond funds with the best 15-year returns
By Andrew Shilling
Managers behind fixed-income funds with the biggest long-term gains nearly double their peers. After a year marked by a global pandemic and near-zero rate environment, their shorter term returns were subsequently even more impressive.
The 20 top-performing bond funds of the past 15 years, with at least $100 million in assets under management, had an average gain of more than 7%, Morningstar Direct data show. Over the past 12 months, the same funds notched an average return of almost 18%.
When considering the bond-market landscape over the shorter timer, it may be hard to fathom the same success in the years to come, says Tom Bradley, managing director and head of capital markets at Miami-based fixed-income software vendor YieldX.
“Last year was an aggressive year for fixed-income performance with global central banks slashing rates as a result of COVID-19, and at the same time re-engaging in secondary market bond purchasing — the perfect combination for high-yield performance,” Bradley says. “Now that markets have plateaued and interest rates globally look grounded (possibly trending higher in the U.S.), fixed income will become a more nuanced sector to invest in as opposed to the ‘rising tide lifts all ships’ mantra of the last few years.”
Compared with broader markets, the iShares Core U.S. Aggregate Bond ETF (AGG), which has a 0.04% net expense ratio, recorded a 15-year gain of just 4.23%, data show. Over the past year, the fund had a gain of 0.32%.
In stocks, the SPDR S&P 500 ETF Trust (SPY) and the SPDR Dow Jones Industrial Average ETF (DIA) have had 15-year returns of 10.20% and 10.28%, respectively. In the past 12 months, SPY and DIA had gains of 50.29% and 45.30%. The funds have net expense ratios of 0.09% and 0.16%.
Morgan Stanley captures surge in retail investing thanks to timely E-Trade purchase
Despite record growth in wealth management, an otherwise rosy earnings report was marred by $911 million loss related to Archegos Capital.

@little5bee-
Take everything on this MaxFunds site with a large grain of salt. Often they overstate the negative. However, for a worst case scenario , it’s an interesting place to look.
ABRTX Overall MaxFunds Score: 50% - Poor
Forecast: 1%
Best Case: 38%
Worst Case: -75%
Lipper gives ABRTX its highest rating (5) for “capital preservation”. However, that’s a backward looking grade - not a projection. While the chart looks steady, the fund’s been open less than 10 years. Why anyone would pay a 2.25% ER for any fund is beyond me.
I do use some funds that use derivatives heavily to hedge market risk or operate in the futures markets (ie ABRZX). With such funds, the integrity and demonstrated expertise of the manager become paramount. Without knowing much about this one, at a glance I’d agree with @Baseball_Fan that it looks dicey. Suggest you continue to investigate. :)

https://www.sec.gov/Archives/edgar/data/935015/000119312521118559/d36840d497.htm
497 1 d36840d497.htm ARTISAN PARTNERS FUNDS, INC.
Filed pursuant to Rule 497(e)
File Nos. 033-88316 and 811-08932
ARTISAN PARTNERS FUNDS, INC.
Artisan High Income Fund (the “Fund”)
SUPPLEMENT DATED 16 APRIL 2021
TO THE FUND’S PROSPECTUS
CURRENT AS OF THE DATE HEREOF
Effective after the close of business on 30 April 2021, the Fund is closed to most new investors. The Fund will accept new accounts from certain investors who satisfy new account eligibility requirements. Eligibility requirements are described in Artisan Partners Funds’ prospectus under the heading “Investing with Artisan Partners Funds—Who is Eligible to Invest in a Closed Fund?”
Accordingly, effective 30 April 2021, the following changes will take effect:
1. The following paragraph is added under the heading “Purchase and Sale of Fund Shares” on page 33 of Artisan Partners Funds’ prospectus:
The Fund is closed to most new investors. See “Investing with Artisan Partners Funds—Who is Eligible to Invest in a Closed Fund?” in the Fund’s statutory prospectus for new account eligibility criteria.
2. The following replaces the text under the heading “Who is Eligible to Invest in a Closed Fund?” on pages 101-102 of Artisan Partners Funds’ prospectus in its entirety:
Artisan High Income Fund is closed to most new investors. From time to time, other Funds may also be closed to most new investors. The Funds do not permit investors to pool their investments in order to meet the eligibility requirements, except as otherwise noted below.
If you have been a shareholder in a Fund continuously since it closed, you may make additional investments in that Fund and reinvest your dividends and capital gain distributions in that Fund, even though the Fund has closed, unless Artisan Partners considers such additional purchases to not be in the best interests of the Fund and its other shareholders. An employee benefit plan that is a Fund shareholder may continue to buy shares in the ordinary course of the plan’s operations, even for new plan participants.
You may open a new account in a closed Fund only if that account meets the Fund’s other criteria (for example, minimum initial investment) and:
∎ you beneficially own shares of the closed Fund at the time of your application;
∎ you beneficially own shares in the Funds with combined balances of $250,000;
∎ 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);
∎ you are transferring or “rolling over” into a Fund IRA account from an employee benefit plan through which you held shares of the Fund (if your plan doesn’t qualify for rollovers you may still open a new account with all or part of the proceeds of a distribution from the plan);
∎ you are purchasing Fund shares through a sponsored fee-based program and shares of the Fund are made available to that program pursuant to an agreement with the Funds or Artisan Partners Distributors LLC and the Funds or Artisan Partners Distributors LLC has notified the sponsor of that program in writing that shares may be offered through such program and has not withdrawn that notification;
∎ you are an employee benefit plan and the Funds or Artisan Partners Distributors LLC has notified the plan in writing that the plan may invest in the Fund and has not withdrawn that notification;
∎ you are an employee benefit plan or other type of corporate, charitable or governmental account sponsored by or affiliated with an organization that also sponsors or is affiliated with (or is related to an organization that sponsors or is affiliated with) another employee benefit plan or corporate, charitable or governmental account that is a shareholder of the Fund at the time of application;
∎ you are a client, employee or associate of an institutional consultant or financial intermediary and the Funds or Artisan Partners Distributors LLC has notified that consultant or financial intermediary in writing that you may invest in the Fund and has not withdrawn that notification;
∎ you are a client of a financial advisor or a financial planner, or an affiliate of a financial advisor or financial planner, who has at least $2,500,000 of client assets invested with the Fund or at least $5,000,000 of client assets invested with the Funds or under Artisan Partners’ management at the time of your application;
∎ you are an institutional investor that is investing at least $5,000,000 in the Fund and the Fund or Artisan Partners Distributors LLC has notified you in writing that you may invest in the Fund and has not withdrawn that notification (available for investments in Artisan International Value Fund only);
∎ you are a client of Artisan Partners or are an investor in a product managed by Artisan Partners, or you have an existing business relationship with Artisan Partners, and in the judgment of Artisan Partners, your investment in a closed Fund would not adversely affect Artisan Partners’ ability to manage the Fund effectively; or
∎ you are a director or officer of the Funds, or a partner or employee of Artisan Partners or its affiliates, or a member of the immediate family of any of those persons.
A Fund may ask you to verify that you meet one of the guidelines above prior to permitting you to open a new account in a closed Fund. A Fund may permit you to open a new account if the Fund reasonably believes that you are eligible. A Fund also may decline to permit you to open a new account if the Fund believes that doing so would be in the best interests of the Fund and its shareholders, even if you would be eligible to open a new account under these guidelines.
The Funds’ ability to impose the guidelines above with respect to accounts held by financial intermediaries may vary depending on the systems capabilities of those intermediaries, applicable contractual and legal restrictions and cooperation of those intermediaries.
Call us at 800.344.1770 if you have questions about your ability to invest in a closed Fund.

@JohnN
Largest: RPSIX. 22.4% of portfolio.
2nd largest: PRSNX. 21.5% of portfolio.
3rd: PTIAX. 7.25% of portfolio.
I'd recommend PTIAX ahead of the others.
RPSIX holds a slice of equities, to "juice" the profit just a bit. Right now, the yield on it is below 3%. But you might make up the difference with cap. gains at the end of the year. RPSIX holds some TRP bond funds that are just plain sub-par. RPSIX is a fund-of-funds.
PTIAX yield is not far from 4%, actually. (3.87.) And as for PRSNX: it's over 3%, which no one should complain about, these days.
My only complaint with PTIAX is that they are slow to vest shares after you buy them. I once asked a Supervisor on the phone: "Is that because you don't have enough people hired to do the job of recording these items in a timely manner?" ..... After I asked the question, he went silent. Which told me a LOT. But the money they make for me is a good thing.

@Crash While it's true that an ethical corporation is somewhat of an oxymoron, there are ways to invest, not to leave a behemoth like Amazon out of the portfolio, yet insist that it behave better than it has in the past towards labor and the environment:
https://morningstar.com/articles/1002749/how-big-fund-families-voted-on-climate-change-2020-edition
https://barrons.com/articles/sec-says-esg-fund-proxy-voting-disclosure-needs-an-upgrade-51617119803
If eliminating the company feels impossible without accepting underperformance, engagement, real public engagement, with the company can happen.

I’ve long been convinced that there is a link between the end of Madoff’s scheme and the overwhelming popularity of index-fund investing in the aftermath of the financial crisis. It’s not simply that, as the Wall Street Journal theorized, people realized pricey money managers hadn’t seen what was coming. Nor was it merely that the regulators’ cursory investigations into Madoff’s fund left many dubious of all sorts of investments (and the officials tasked with overseeing them). Instead, Madoff demonstrated the lie that almost any savvy individual investor could produce steady gains in a way that nothing else could. By destroying the retirements and dreams of so many, he inadvertently performed a much-needed service.

I'm not so convinced. Outside the realm of the ultra-rich, Madoff was hardly known before the scandal because it was an exclusive hedge fund. Meanwhile, Bogle was already practically a household name by the time of the scandal. I would say the growth of no load funds and fee-only/fee-based financial advisers had more to do with the shift to indexing. Instead of selling high cost active management with a commission or load based fund, advisers were charging a percentage of asset fee, typically 1%. Combine that fee with a high cost active fund charging 1.5% and you've got a 2.5% drag on returns each year. A 0.05% index fund combined with the 1% was far more palatable and produced better results. The whole advice model has shifted dramatically.
Any bull market of course will drive investors to index too, and of course Bogle's own presence, his constant evangelizing and having the numbers to back it up. If there was any fund's fall that might have done more harm to active manager's influence on retail investors it would be Bill Miller's Legg Mason Value when it got completely crushed during the 2008-09 crisis after 15 straight years of beating the market. He was one of the last great heroes of active management in the retail world. Who by contrast in retail-land heard of Madoff before everyone who had heard of him lost their shirts?

They will have higher turnover for sure, but not necessarily more volatility during downtrends. It depends on the nature of the downtrend. A 2000-2002 type selloff, an equal-weighted index would've held up better. Not so in 2020.

Sorry if this is a repeat. I don't remember posting/seeing this filing.
https://www.sec.gov/Archives/edgar/data/836487/000110465921032581/a21-8652_3497.htm
497 1 a21-8652_3497.htm 497
Prospectus and Summary
Prospectus Supplement
March 5, 2021
Morgan Stanley Institutional Fund, Inc.
Supplement dated March 5, 2021 to the Morgan Stanley Institutional Fund, Inc. Prospectus and Summary Prospectus dated April 30, 2020
Inception Portfolio (the "Fund")
Effective at the close of business on April 5, 2021, the Fund will suspend offering Class I, Class A, Class C and Class IS shares of the Fund to new investors, except as follows. The Fund will continue to offer Class I, Class A, Class C and Class IS shares of the Fund:
(1) through certain retirement plan accounts,
(2) to clients of certain registered investment advisers who currently offer shares of the Fund in their asset allocation programs,
(3) to directors and trustees of the Morgan Stanley Funds,
(4) to Morgan Stanley affiliates and their employees,
(5) to benefit plans sponsored by Morgan Stanley and its affiliates and
(6) omnibus accounts sponsored or serviced by a financial intermediary that currently hold shares of the Fund in such accounts.
Retirement plan accounts (including new retirement plan accounts) investing through platforms that trade omnibus by plan for Fund shares as of April 5, 2021, fall under the exception for "certain retirement plan accounts" set forth above.
Existing omnibus accounts (accounts offered on platforms that aggregate all underlying client-level transactions into one account) that are shareholders of record are considered one type of existing shareholder. Therefore, shares of the Fund will continue to be offered to underlying clients (including new clients) through such existing omnibus accounts.
The Fund will continue to offer Class I, Class A, Class C and Class IS shares of the Fund to existing shareholders. In addition, the Adviser, in its discretion, may make certain exceptions to the suspended offering of Class I, Class A, Class C and Class IS shares of the Fund.
The Fund may recommence offering Class I, Class A, Class C and Class IS shares of the Fund to new investors in the future. Any such offerings of the Fund's Class I, Class A, Class C and Class IS shares may be limited in amount and may commence and terminate without any prior notice.
The Fund has suspended offering Class L shares to all investors. Class L shareholders of the Fund do not have the option of purchasing additional Class L shares. However, existing Class L shareholders may invest in additional Class L shares through reinvestment of dividends and distributions.
Please retain this supplement for future reference.
IFIINCEPTPROSPSPT 3/21

@hank : PRSIX appears to be holding close to 13.5 % cash at this time. Is this a (normal) % for cash or are they building some dry powder ?
Just wondering , Derf

@Derf - It may be a bit of an illusion. Lipper puts the stock holdings today at 40%, which is the fund’s target equity allocation. More likely, the cash buildup represents a retrenchment from bonds into cash / shorter duration securities. No doubt, however, they’ve also moved away from equities to a lesser extent (from a slightly overweight position).
Here’s what I’ve been able to dig up .....
From T. Rowe’s website on (April 14) https://www.troweprice.com/personal-investing/tools/fund-research/PRSIX / Click on “Portfolio” option at top.

Domestic Bond 26.90%
Domestic Stock 26.40%
Foreign Bonds 16.10%
Foreign Stock 13.40%
Cash 10.80%
Other 5.80%
Convertibles 0.50%
Preferred Stock 0.10%
Here’s the fund’s Semi-Annual Report from November 2020. Reserves are listed at 10%. Contains a foot-note stating that reserves include the “cash underlying futures positions such as the Russell 2000 futures” https://www.troweprice.com/literature/public/country/us/language/en/literature-type/semi-annual-report/sub-type/mf?productCode=PSI¤cy
Here’s its published March 31, 2021 update . https://www.troweprice.com/literature/public/country/us/language/en/literature-type/portfolio-update/sub-type/portfolio-update?productCode=PSI¤cy=USD
Curiously, above March update puts “cash benchmarked” at 23%. Some of the 23% reflects cash underlying futures positions . I’d take that 23% number with a large grain of salt. Especially since It appears the linked March 31 report was intended for professionals and not ndividual investors. Stated cash gets “funky” sometimes when funds engage in derivatives, short sales, futures trading, etc. (all a bit beyond my comprehension).
Lipper puts cash now at 14%. And M* has it at 13.5%. T. Rowe’s own investor website lists cash as 10.8%.
Note: Money managers and individuals generally have shifted from longer duration bonds into shorter duration bonds, and cash / cash alternatives over the past 3 months. So the cash build for PRSIX likely reflects a similar move by PRSIX’s managers.
*** I’m still puzzled by that high “benchmarked cash”. Wondering if it might reference the cash held by the fund’s benchmark index)? I can’t imagine one of their conservative allocation funds getting that high. TRRIX, by comparison, has virtually no cash, preferring to use intermediate / short duration TIPS in that spot.

I can't link the article because of a paywall. Sorry. Read this on my brokerage account page.
"WASHINGTON (Reuters) - Market participants this week staked out their positions on how to fix systemic risks in the $4.9 trillion U.S. money market fund industry, in what is shaping up to be the first big fight for U.S. President Joe Biden's financial regulators.
After taxpayers bailed them out for the second time in 12 years during the pandemic-induced turmoil in March 2020, money market funds - a key source of short-term corporate and municipal funding - are facing a regulatory reckoning which could potentially change the industry beyond all recognition."
BY PETE SCHROEDER AND MICHELLE PRICE, REUTERS - 1:23 PM ET 4/13/2021

Thanks , Lynn, appreciate your comment on TMSRX.
As a retired and somewhat conservative investor, I am also "mixing and matching to have a consistent performance over time" by using the following funds in my portfolio which M* classifies as "Low" or "Below Average" risk:
ARBIX, NVHAX, VWINX, JHQAX, RCTIX, and TSIIX
Just to spice things up a bit, I am also using FMSDX, a fund M* rates as "Above Average" risk.
I am in a capital preservation mode and looking for my portfolio to generate an annual total return of approx. 4-6%.
Thanks, again, for your research and analysis efforts in this area.
Good luck,
Fred

FSRPX and FSMEX paid capital gains 4/9/21. I did finally see it posted on Fidelity's website. I'll check out M* thanks @DaveSch...good stuff...that worked:

It's a bit early for the 2021 postings, but CHTTX posted huge gains on 3/25 of what pretty much sums up as a split.

FWIW.....from the 12/31/2020 Finls (unaudited) Edgar filing:
Note 10. Other Affiliate Matters
The Investment Adviser has historically been affiliated through common control with Highland Capital Management, L.P. (“HCMLP”), an SEC-registered investment adviser that filed for Chapter 11 bankruptcy protection on October 16, 2019. On January 9, 2020, the United States Bankruptcy Court for the Northern District of Texas (the “Court”) approved a change of control of HCMLP, which involved the resignation of James Dondero as the sole director of, and the appointment of an independent board to, HCMLP’s general partner. On October 9, 2020, Mr. Dondero resigned as an employee of HCMLP and as portfolio manager for all HCMLP-advised funds. As a result of these changes, the Adviser is no longer under common control or otherwise affiliated with HCMLP. Mr. Dondero continues to be a portfolio manager for the Investment Adviser and the Fund.
On November 13, 2020, HCMLP filed an amended plan of reorganization and disclosure statement with the Court (the “Amended Plan”), which was subsequently approved by the Creditors and confirmed (subject to final order) by the Court. On November 30, 2020, HCMLP provided notice of termination of the Shared Services Agreement with the Investment Adviser, through which HCMLP had provided support services to the Adviser. The Shared Services Agreement was terminated effective February 19, 2021. However, the Investment Adviser expects to be able to continue to provide the required advisory and support services to the Trust through a transfer of personnel, equipment and/or facilities from HCMLP either to the Investment Adviser or to a third-party service provider.

Is there a website that allows one to enter a mutual fund to get capital gain information? I noticed two funds I own distributed CG recently (April 9, 2021).

https://www.bloomberg.com/news/features/2021-04-08/how-bill-hwang-of-archegos-capital-lost-20-billion-in-two-days
Before he lost it all—all $20 billion—Bill Hwang was the greatest trader you’d never heard of.
***Starting in 2013, he parlayed more than $200 million left over from his shuttered hedge fund into a mind-boggling fortune by betting on stocks. Had he folded his hand in early March and cashed in, Hwang, 57, would have stood out among the world’s billionaires. There are richer men and women, of course, but their money is mostly tied up in businesses, real estate, complex investments, sports teams, and artwork. Hwang’s $20 billion net worth was almost as liquid as a government stimulus check. And then, in two short days, it was gone.
The sudden implosion of Hwang’s Archegos Capital Management in late March is one of the most spectacular failures in modern financial history: No individual has lost so much money so quickly. At its peak, Hwang’s wealth briefly eclipsed $30 billion. It’s also a peculiar one. Unlike the Wall Street stars and Nobel laureates who ran Long-Term Capital Management, which famously blew up in 1998, Hwang was largely unknown outside a small circle: fellow churchgoers and former hedge fund colleagues, as well as a handful of bankers.***
Win big...loose big
Anyone came close w their portfolios?

I have been looking at Highland Capital Management with respect to their NexPoint Merger Arbitrage fund (HMEZX).
.......................
If anybody has more up to date information on the fund advisor's bankruptcy status, I would appreciate hearing from you.
But, buyer beware.
Fred

This is a great find, Fred. I was looking into this fund too, great pair with other funds when combined, tested in Portfoliovisualizer. However, now I'm hesitating to purchase this fund. Does anyone know if it is a good choice? It is on the list of GreatOwnls.

I’ve caught most, but not all, of this March 25 interview. She sounds fascinating. Covers areas like investment and liquidity risk, hedging to reduce risk, interest rates and tactical investing. Suspect there’s an education to be had here if one has the time (30 minutes).
Notes from later viewing:
- This is not a hedge fund, but rather a foundation serving philanthropy and having a nearly infinite time horizon.
- Fitzpatrick uses the phrase “leaning into (market) dislocation” repeatedly to describe adding to holdings when markets appear cheap.
- Gentle swipe at open ended funds which “have to play to the lowest common denominator” (ie - provide steady predictable but inferior returns) on investor capital.
- Sounds concerned about liquidity in treasury markets. Alludes to possible exaggerated reactions in bond market to macro-news or developments.
- Was approached recently by Blackstone about a position / declined offer
https://www.bloomberg.com/news/videos/2021-03-25/soros-cio-revives-her-boss-s-legendary-risk-appetite-video