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The Matthews China "small companies" fund MCSMX (86% small & mid-cap) has stayed well ahead of the China Fund (19% small & mid cap) since January 2020. (They're both growth funds.) From that limited comparison, looks like that advice has been good for a while now.But assuming Xi's rhetoric has teeth, the real play here is not to sell out of China completely, but to switch to small- and mid-cap China stocks.
For I Bonds bought by October 31, the one year yield will likely be 4.8%
*snip*
In his previous interviews he mentioned that bank loans (or floating rate bonds) are attractive because of their high yield (3%) and short duration (1-2 years). Even though bank loans are rated junk, they are safer because they are high in capital structure in case of the banks defaulting on the loans. Also he mentioned that utilities are attractive and stable while offer 3-4% yield.
You are correct. Giroux has stated in his annual semi-annual reports (within past 1-2 years) that he views bonds as a terrible investment under current conditions. (Not an exact quote - but a close approximation). I don’t pretend to understand his methodology and how he keeps volatility as low as he does. But seems to work for him. Probably playing with some derivatives to hedge bets.One of the portfolio stats that jumped out at me was that bond holdings only accounted for 1.4% of fund assets. I'm a bond novice compared to many here who are able to speak with incredible knowledge, but this fact certainly says much about Giroux's views on bonds. His main focus on bonds for a bit has been short-term high yield, so it seems he's even moved on from that area.
Jeffrey Colon, The Great ETF Tax Swindle: The Taxation of In-Kind Redemptions, 122 Penn St. L. Rev. 1 (2017)Throughout the history of U.S. investment companies, in-kind distributions have been exempt from tax at the fund level. As Congress began to limit and finally prohibit in 1986 the tax-free distribution of appreciated property by corporations, it continued to specifically exempt open-end funds from this rule. There is scant discussion in the legislative history for the justification for this exemption or why closed-end funds were not also eligible. Perhaps the simplest explanation for the legislative silence is that when [the tax code was changed to narrow the exemption], in-kind distributions from open-end funds were rare.
This proposal does not affect ETFs used in tax-deferred accounts. We still have much to learn on the details of this proposal and how it affects our investment.Senate Finance Committee Chairman Ron Wyden’s proposal aims to tax ETFs’ use of “in-kind” transactions that currently avoids triggering capital-gains taxes. With such in-kind transactions, ETFs—bundles of securities that trade on exchanges—transfer appreciated stock, bonds or other assets to Wall Street intermediaries instead of cash.
By closing a decades-old tax regulation loophole, the proposal stands to eliminate one of the ETF industry’s key selling points: tax efficiency. This proposed change has spurred a rush to mobilize among the largest asset managers, some of whom have built their businesses around the ETF industry.
“ETFs have become big capital gains deferral machines,” said Jeffrey Colon, a professor at Fordham University School of Law who has researched this topic.
ETFs are able to avoid taxes with in-kind transactions thanks to a tax exemption intended for mutual funds, created long before ETFs existed.
“The ability of these funds to do in-kind redemptions of appreciated property is being weaponized and used in a way that Congress surely couldn’t have intended,” he said.
The impact of the proposal would largely fall on ETFs rather than mutual funds, which largely distribute assets to investors in cash.
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