Because year after year my bond funds have done well and continue to do well. In some years there have been losses of less than 2%. These losses are more than made up for in the next year with gains of 7 or 8 or 9%. For years now experts are saying bonds will lose money and yet my bond funds and the bond portions of two balanced funds are doing fine. Or they sure seem to be doing fine.

update:
https://www.sec.gov/Archives/edgar/data/891079/000119312521065141/d128745d497.htm
497 1 d128745d497.htm HIGHLAND FUNDS II
HIGHLAND FUNDS II
Highland Socially Responsible Equity Fund
Supplement dated March 2, 2021 to the Summary Prospectus, Prospectus and Statement
of Additional Information (“SAI”) each dated January 31, 2021, as supplemented from time to time
This Supplement provides new and additional information beyond that contained in the Summary Prospectuses, Prospectus and Statement of Additional Information and should be read in conjunction with the Summary Prospectuses, Prospectus and Statement of Additional Information.
IMPORTANT NOTICE
The following information supplements and supersedes any information to the contrary contained in the Summary Prospectus, Prospectus and/or Statement of Additional Information of Highland Socially Responsible Equity Fund, a series of Highland Funds II (the “Trust”), each dated and supplemented as noted above.
As previously disclosed on October 28, 2020, and as supplemented on January 31, 2021, the Board of Trustees (the “Board”) of Highland Funds I (the “HFI”) and Highland Funds II (the “HFII”) unanimously approved an Agreement and Plan of Reorganization (the “Plan”) for the reorganization of Highland Socially Responsible Fund (the “Acquired Fund”) into NexPoint Merger Arbitrage Fund (the “Acquiring Fund,” and together with the Acquired Fund, the “Funds”).
The shareholders of the Acquired Fund approved the reorganization at a special meeting of shareholders held on February 26, 2021. The reorganization will take effect on March 2, 2021. Effective immediately, the Acquired Fund will be closed to new and existing investors.
Please contact the Adviser at 1-877-665-1287 if you have questions about the Reorganization or your account.
For more information regarding the Acquired or Acquiring Fund please call 1-877-665-1287 or visit the Funds’ Web site at https://www.highlandfundadvisors.com/.
INVESTORS SHOULD RETAIN THIS SUPPLEMENT WITH THE SUMMARY PROSPECTUS,
PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION FOR FUTURE REFERENCE.
HFII-HPE-SUPP-0321

I first asked about this in 2011, when the "covered" vs "non-covered" reporting legislation came into effect. It seemed clear that I needed to divide my transactions into two bins, one for "non-covered" and one for "covered" going forward. But, I never did so since I hardly sold anything in a taxable account. Now for 2020 tax season this is biting me big time:
Remember, even if you use the average cost method, the mutual fund companies all seem to calculate two different bases - one for "non-covered" (pre-2012) shares and one for "covered" (2012 and later.) For example:
2010: Buy 100 sh XYZZX at $10 (non-covered)
2015: Buy 100 sh XYZZX at $30 (covered)
2020: Sell 100 sh XYZZX at $50 (will be non-covered shares, the non-covered bin is emptied first)
2021: Sell 100 sh XYZZX at $50 (will be covered shares)
They are going to report your sale from the uncovered bin first - so the basis for your 2020 sale will be $1000, for a $4000 gain. For 2021, the shares are covered; they will report a basis of $3000 to the IRS and a $2000 gain.
If you mistakenly combined both purchases into the same bin and calculated the average basis, you might be tempted to report each of the sales with a $2000 ($20 per share) basis. Since the 2020 sale is not covered, you might report a $2000 basis for it, for a $3000 gain, which the IRS won't know about. But for 2021, you will also need to report a $2000 basis, for a $3000 gain, which is different from what you will get on your 1099-B. This could get you a letter from the IRS.
For some reason how this two-bin basis calculation works is not documented or explained anywhere online, or by any of the fund companies' tax guides. Best bet: just assume that all the numbers on your 1099-B are right, even for non-covered shares you have had a long time. You might want to break out non-covered vs covered bases now, before you exhaust your un-covered shares. Those can probably be fudged a little, as log as all the bases you have used for all the sales in each bin add up to the amount that you paid in to the fund.
Another way is to use FIFO or some other method. In retrospect, that might have been easier than average cost.

Linking some analysis from today. (Published before the price turned and headed south again.)
LINK
Hard to figure out. It’s a rocky investment most of the time and hasn’t done as well as equities over the years. Still, some find it appealing as a small holding in a diversified portfolio. Others have an almost spiritual fascination with it and have loaded up mightily.
- Rising interest rates tend to spook metals markets.
- Perceptions the Fed will keep rates very low tend to support metals markets.
- The bitcoin craze has, as others noted, impacted the metals markets for the worse.
It should be noted that metals & miners did very well during 2019-20. Some mining funds sported one year gains of around 50%. To some extent, dues are being paid today for that immense run-up.
LINK to miners ETF (shows current price)

update to institutional shares (GCMFX, GNMFX):
https://www.sec.gov/Archives/edgar/data/810893/000119312521062769/d124234d497.htm
497 1 d124234d497.htm 497
PIMCO Funds
Supplement dated March 1, 2021 to the Municipal Value Funds Prospectus (the “Prospectus”), and to the Statement of Additional Information (the “SAI”), each dated July 31, 2020, each as supplemented from time to time
Disclosure Related to the PIMCO California Municipal Opportunistic Value Fund and PIMCO National Municipal Opportunistic Value Fund (each a “Fund” and collectively the “Funds”)
As previously disclosed, PIMCO may from time to time determine to close either or both Funds to initial purchases by new investors or to initial purchases by new investors and subsequent purchases by existing shareholders and will provide notice regarding such closures.
Effective March 3, 2021 (the “Effective Date”), the Funds will close to initial purchases by new investors and subsequent purchases by existing shareholders. Such closure will not affect the rights of existing shareholders with respect to shares of the Funds held as of the Effective Date. The purchase of additional shares of the respective Fund through dividend reinvestments will continue to be permitted.
Notice will be provided regarding any future reopening of a Fund to subsequent purchases by existing shareholders or to initial purchases by new investors and subsequent purchases by existing shareholders.
Investors Should Retain This Supplement for Future Reference

For me, RPHYX outperformed BBBMX TRBUX and DLSNX in 1Q 2020, losing (.74)% . ZEOIX blew up and I was lucky to break even with that fund. I'm sticking with RPHYX for now, but definitely watching it closely !

There is a lot more information in Buffett's interview with respect to bonds in general.

“Bonds are not the place to be these days,” Buffett said. “Fixed-income investors worldwide – whether pension funds, insurance companies or retirees – face a bleak future.”
Buffett noted that the benchmark 10-year Treasury yield had fallen drastically to 0.93% at the end of 2020 from 15.8% in September 1981. Meanwhile, investors earn a negative return on trillions of dollars of sovereign debt in Germany and Japan, he added.

If US investment opportunties are so great, why is he buying back $9 billion worth of Berkshire Hathaway stock? The answer is that he have had hard time buying them within his metrics and this is consistent with his investment pattern for a number of years. Recent purchase in drug and telecommunication stocks is a reflection of his forward looking view in post-pandemic scenario.
In addition, Buffet also made many mistakes just like other investors or fund managers. His value investment approach exposes him to the value-trap stocks. At least he owed up to his mistakes and moved on.
https://reuters.com/article/us-berkshire-buffett-precisioncastparts/warren-buffetts-10-billion-mistake-precision-castparts-idUSKCN2AR0MZ

I tend to go along with the Capital Group's approach that many 'American' companies earn substantial revenues from overseas, so you don't necessarily need to formally look overseas to find 'overseas exposure' in your portfolios. So in that regard, I guess you could say Warren is still correct -- but it comes across as a bit of an anachronistic sentiment these days, maybe?

Here we go again. It never closed to new investors categorically. It only closed to new investors through some (but not all) channels.

As of November 1, 2013, the fund is generally closed to new investors other than those who ... invest directly with American Century....

Summary prospectus, Aug 1, 2020

@msf makes valid points regarding GP’s exposure to certain favorite stocks and the difference between BCISX and GP funds. BCSIX now holds $8B+ spread among 41 positions, holds no international stocks, and is a different animal from any GP fund. Probably due to its growth, BCSIX is no longer a SCG fund, but MCG. When I first bought it, this was not the case. I have never been able to figure out why the Brown Capital method does not work for their MCG fund, BCMSX, a true plodder. If BCSIX can’t stay above the thirtieth percentile in its category, it might be an indication that it’s no longer the winner it once was. I don’t want to sell BCSIX, but I’m adding any new dollars to Driehaus if I want true SCG coverage. I think BCSVX, which has $ I used to have in Grandeur Peak, continues to be a great foreign growth offering.

Would you suggest a ticket for the Driehaus Fund? What do you think of GRANDEUR PEAK Funds, especially GLOBAL MICRO CAP FUND ?

@Baseball_Fan

I want to know what the young man who was running the fund was exactly doing? Was there malfeasance? Or did he really believe the 3rd party model was incorrect and there was a "tweaking" for good reason? He's obviously lawyered up. Who else knew and who challenged him on his actions? Wasn't there a compliance/risk officer? What was he doing/not doing/getting paid for?

Good questions. To those I would add what was it that finally did bring this to the SEC's attention?
Regarding the audit question, I was referring to the annual reports.
This is from their August 2020 annual report:

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trustees of Trust for Advised Portfolios and the
Shareholders of Infinity Q Diversified Alpha Fund
Opinion on the Financial Statements
We have audited the accompanying consolidated statement of assets and liabilities of Infinity Q Diversified Alpha Fund, a series of shares of beneficial interest in Trust for Advised Portfolios, and Subsidiary (the "Fund"), including the consolidated schedule of investments as of August 31, 2020, and the related consolidated statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, the statement of cash flows for the year then ended, and the financial highlights for each of the years in the three-year period then ended, and the related notes (collectively referred to as the "financial statements"). The consolidated financial highlights for the years ended August 31, 2017 and August 31, 2016 were audited by another independent registered public accounting firm whose report, dated February 1, 2018, expressed an unqualified opinion on those consolidated financial highlights. In our opinion, the financial statements present fairly, in all material respects, the consolidated financial position of the Fund as of August 31, 2020, the consolidated results of their operations for the year then ended, their cash flows for the year then ended, the changes in their net assets for each of the years in the two-year period then ended, and financial highlights for each of the years in the three-year period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of August 31, 2020, by correspondence with the custodian, prime broker and third-party counterparties. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Bold emphasis my own.
To answer my own question. My interpretation is that the audit just makes sure that there are no irregularities in the numbers or accounting in the financial reports but not an assessment of the validity of how the asset values are obtained or the actual pricing of the assets themselves. But I'm no expert on financial reports.
I also think the comparison of Infinity Q and T. Rowe Price is like comparing apples & oranges, even concerning TMSRX. Especially as Infinity Q was essentially a one man operation. Anything is possible & I definitely understand the concern.
@Sma3
Regarding IOFIX, my impression was they were not disclosing to shareholders the risks involved with some of their holdings- their method of buying & valuing odd lots not widely traded which during times of stress (ie last March) might become difficult to unload.
@Derf
I have no idea what a "reasonable" amount would be but for me, in general, I tend to limit any one holding to no more than 5-7%. TMSRX is currently around 6.5%. The main exception to that is PRWCX which I started investing in back in the 1990s. It sits around 16%.

https://www.teletrader.com/stone-ridge-becomes-first-etf-to-buy-bitcoin/news/details/54736690?internal=1&ts=1614362597371
Previously:
https://www.forbes.com/sites/michaeldelcastillo/2020/10/13/stone-ridge-reveals-115-million-bitcoin-investment-as-part-of-billion-dollar-spin-off/?sh=4953b2a79850
Filing: https://www.sec.gov/Archives/edgar/data/1764894/000119312519260862/d693146dn2.htm

https://www.sec.gov/Archives/edgar/data/908186/000090818621000023/accp3121mcv497.htm
(ACMVX)
American Century Capital Portfolios, Inc.
Summary Prospectus and Prospectus Supplement
Mid Cap Value Fund
Supplement dated March 1, 2021 n Summary Prospectus and Prospectus dated August 1, 2020
As of April 1, 2021, the fund will be open to all investors.
The following changes are effective April 1, 2021:
The first paragraph under Purchase and Sale of Fund Shares on page 5 of the summary prospectus and the prospectus is deleted.
The section entitled Closed Fund Policies on page 17 of the prospectus is deleted.

JohnGaltill said: In the past, many market pundits predicted 8% - 10% gains for a specific year but market returns rarely fall with this range. If all ships will be lifted, where will customers moor their yachts?

8-10% annual return seems overly optimistic given this low yield environment. Other analysts talk more about the challenges going forward and investment opportunities.

https://www.sec.gov/Archives/edgar/data/1199046/000139834421004672/fp0062798_497.htm
(SLCSX)
497 1 fp0062798_497.htm
SELECTIVE OPPORTUNITY FUND
Supplement to the Prospectus
and Statement of Additional Information
dated
April 29, 2020
Supplement dated February 26, 2021
The Board of Trustees has determined that it is in the best interest of shareholders to liquidate the Selective Opportunity Fund (the “Fund”).
As of the date of this supplement, the Fund is no longer accepting purchase orders for its shares and it will close effective June 21, 2021 (the “Closing Date”). Shareholders may redeem Fund shares at any time prior to the Closing Date. Procedures for redeeming your account, including reinvested distributions, are contained in the section “How to Redeem Shares” of the Fund’s Prospectus. Any shareholders that have not redeemed their shares of the Fund prior to the Closing Date will have their shares automatically redeemed as of that date, with proceeds being sent to the address of record. If your Fund shares were purchased through a broker-dealer and are held in a brokerage account, redemption proceeds may be forwarded by the Fund directly to the broker-dealer for deposit into your brokerage account.
The Fund will continue to pursue its investment objective through the Closing Date. Any capital gains will be distributed as soon as practicable to shareholders and reinvested in additional Fund shares, unless you have requested payment in cash.
IMPORTANT INFORMATION FOR RETIREMENT PLAN INVESTORS
If you are a retirement plan investor, you should consult your tax adviser regarding the consequences of a redemption of Fund shares. If you receive a distribution from an Individual Retirement Account (IRA) or a Simplified Employee Pension (SEP) IRA, you must roll the proceeds into another IRA within 60 days of the date of the distribution in order to avoid having to include the distribution in your taxable income for the year. If you are the trustee of a qualified retirement plan or the custodian of a 403(b)(7) custodian account (tax-sheltered account) or a Keogh account, you may reinvest the proceeds in any way permitted by its governing instrument.
* * * * * *
This supplement and the Prospectus provide the information a prospective investor should know about the Fund and should be retained for future reference. A Statement of Additional Information dated April 29, 2020 has been filed with the Securities and Exchange Commission and is incorporated herein by reference. You may obtain the Prospectus or Statement of Additional Information without charge by calling the Fund at (434) 515-1517 or visiting www.selectivewealthmanagement.com.

- More troops with live amo defending nation’s capital and elected officials against violent attack from domestic-bred terrorists. You attack. We shoot.
- Less time (0 recommended) of CNN “interviewing” on TV spokesmen for groups so disposed.
A despicable grab for ratings.

You make some fair points, I guess. Thanks Lewis.

Large institutions often provide seed money, although that is not the case for some such as Vanguard, but even when the seed money is large asset-wise, that doesn't mean trading volumes of the ETF are high. The seed money could be from an institution--often insurers do this--that never or rarely trades its shares and just sits there in the ETF. Ultimately trading volume and bid-ask spreads matter more than assets under management for those who trade ETFs. Then again, for those who are buy and hold investors, assets under management and trading volumes really don't matter much. There could be some tracking error versus the index I suppose with a small asset base and too few shares of some companies in the index, but quants have become pretty good at optimizing that away via sampling. In other words, anyone looking for a long-term investment probably doesn't have too much to fear in this ETF, especially in a tax sheltered IRA account. In a taxable account there is a risk of a tiny ETF being liquidated and then having to pay capital gains taxes after the liquidation on appreciated shares.

His summary of 2021? Expecting an 8 percent gain in S/P for the year. Stimulus and Fed accommodating... means a great year for equities, don't hold Bonds unless they are very short term etc. etc. Stimulus is pumping a ton of money into the economy. That money will be spent. That will lift all ships.

There is potential career risk if someone's prediction is wrong and it differs from "the crowd".
In the past, many market pundits predicted 8% - 10% gains for a specific year but market returns rarely fall with this range. If all ships will be lifted, where will customers moor their yachts?

@Mark I got rid of all bonds except a very small position in FXNAX. My FNBGX was up quite a bit in 2020 (not sure why and it still trailed S&P index), thankfully I sold before 2021. Why? It’s down 10% YTD. I’m having a very hard time justifying any bond exposure right now. Actually, when I look back at the last 10-15 years, I held too many bonds (in case of?) and at the expense of many years of equity superiority. The crash(s) where bonds outperformed and helped me were few and far between. But I’m still learning and don’t know what I don’t know.

@WABAC - have you sold all of your bond funds on the expectation of a rise in rates? I'm just trying to understand why anyone would do this while those who control the rates indicate no interest or reason for doing so at this time. I read the articles and I've listened to all the chatter and I just don't see what indications are pointing to a need for disposing bond funds.

Rates can go up even if the Fed isn't actively raising them. Rates will go up if the bonds don't sell.
I found this article this morning.

The 10-year U.S. Treasury yield topped the 1.49% level on Thursday morning, its highest level in more than a year. . .
. . . The move higher in rates is unnerving investors fearing inflation could be driving it instead of just the economy recovering. The 10-year yield ended January at 1.09%. It closed 2020 well under 1%. So it’s moved more than a half percentage point in under two months, quite rapid for the bond market and relative to rates at these historically low levels.

I don't particularly like bond funds. So rather than watch some remarkable gains -- for bonds -- evaporate, I decided to sell. When I'm ahead 8% on a TIPs index fund it's no fun for me to watch the drip, drip, drip. And so on with the other funds, even if the returns were smaller.
I still have assets that will do well if inflation explodes. FFRHX has been going up while my other bond funds have been going down. MERKX has shown signs of life. But so far, there aren't any wins to lock in.
I might move into ultra-short bond funds if they offer any improvement over Vanguard's money-market settlement fund.
I'm late on reexamining, and re-balancing, my portfolio for the year. For the past 14-15 months I have been as completely invested as I have been for a while. So this season I have been taking some profits, closing positions I no longer have faith in, and generally raising cash.