I happen to own USA as a small percentage (<2.0%) of my dividend growth portfolio. I couldn't afford to buy many of their top holdings outright so I saw this as a way to gain a foothold while getting a little back in return. The author stated that it is run by 5 managers however the company website says: "Multi-managed fund that allocates its portfolio assets on an approximately equal basis among several independent investment organizations (currently three in number) having different investment styles and/or strategies recommended and monitored by ALPS Advisors, Inc., the Fund's investment advisor."
As Lewis noted nearly all of the return comes from LT capital gains. The last time it returned capital was in 2014 and that was roughly $0.07/share.

Scenario:
I own a income bond fund in a taxable account that distributes monthly dividends. These dividends may either be directed to cash or used to repurchase additional share of the income fund. My brokerage calculates this dividend distribution as a loss in share price for the fund, but my total return has remained the same since (I have more share or cash in addition to the remaining shares albeit at a lower price).
If I repurchase share with the dividends:
My ACB (Average Cost Basis) of all shares should be theoretically lower since these dividend distribution adjustmented the share price lower and the subsequent repurchase of additional shares were bought at this lower price, but these dividends are also report-able as income in a taxable account.
This added income tax may prompt a decision to sell shares to pay the taxes on the dividends (since this cash was used to to repurchase shares). This selling adds another layer of report-able distributions (which may be either short or long term capital gains) for tax purposes. This seems inefficient.
Wouldn't taking dividends as well as long or short term capital gains in cash be a better way to managed (tax wise) these distributions?

The title said it all and investors should ask how and where does that level of dividend come from. Even in open end mutual funds there are years where the sizable year-end distribution came from capital gain, even though they may be long term CG. CEFs are less transparent on this matter.

Actually, I'm looking at recent years for these funds and it seems like recently most of the dividend has come from distributed capital gains, not return of capital. Still, at the end of day all that matters is the total return regardless whether that return is paid out as a distribution or not, assuming one is unconcerned about taxes. If taxes are a concern, then the distribution could actually lower one's total return.

Neglects to mention that some if not most of this dividend income may be from return of capital, so while your income is payed out, the value of the underlying investment decreases by the amount of capital required to pay you the dividend. There is a Ponzi-ish dimension to return of capital dividends, even though these may in fact be good funds in other regards.

https://www.sec.gov/Archives/edgar/data/1535174/000119312518191657/d602674d497.htm
497 1 d602674d497.htm 497
SALIENT MF TRUST
Supplement dated June 13, 2018
to the Salient Adaptive Growth Fund Class A, Class C and Class I Prospectus and Salient Adaptive Growth Fund
Statement of Additional Information
each dated May 1, 2018, as supplemented
NOTICE OF LIQUIDATION OF SALIENT ADAPTIVE GROWTH FUND
On June 8, 2018, the Board of Trustees of Salient MF Trust (the “Trust”), including all of the Trustees who are not “interested persons” of the Trust (as that term is defined in the Investment Company Act of 1940, as amended), approved the liquidation of the Salient Adaptive Growth Fund (the “Fund”), a series of the Trust. The Fund will be liquidated pursuant to a Board-approved Plan of Liquidation on or around August 13, 2018 (the “Liquidation Date”). On the Liquidation Date, the Fund will distribute pro rata to its respective shareholders of record as of the close of business on the business day preceding the Liquidation Date all of the assets of the Fund in complete cancellation and redemption of all of the outstanding shares of beneficial interest, except for cash, bank deposits or cash equivalents in an estimated amount necessary to (i) discharge any unpaid liabilities and obligations of the Fund on the Fund’s books on the Liquidation Date, including, but not limited to, income dividends and capital gains distributions, if any, payable through the Liquidation Date, and (ii) pay such contingent liabilities as the officers of the Trust deem appropriate.
IN LIGHT OF THE PLANNED LIQUIDATION, EFFECTIVE ON JUNE 14, 2018, SHARES OF THE SALIENT ADAPTIVE GROWTH FUND WILL NO LONGER BE OFFERED TO NEW INVESTORS OR EXISTING INVESTORS (EXCEPT THROUGH REINVESTED DIVIDENDS) OR BE AVAILABLE FOR EXCHANGES FROM OTHER FUNDS OF THE TRUST.
PLEASE KEEP THIS SUPPLEMENT FOR FUTURE REFERENCE
****
SUPP ADP GRWTH LIQ 06132018

FYI: U.S. stock benchmarks retreated slightly Wednesday afternoon as the Federal Reserve’s raised benchmark interest rates by a quarter of a percentage point, as expected, and signaled that the domestic economic growth outlook warrants further rate increases.
Regards,
Ted
Bloomberg:
https://www.bloomberg.com/news/articles/2018-06-12/asian-stocks-set-to-slip-as-central-banks-meet-markets-wrap
Bloomberg Evening Briefing:
https://www.bloomberg.com/news/articles/2018-06-13/your-evening-briefing
Reuters:
https://www.reuters.com/article/us-usa-stocks/wall-street-flat-as-fed-decision-awaited-idUSKBN1J91HI
MarketWatch:
https://www.marketwatch.com/story/us-stock-futures-climb-ahead-of-key-fed-decision-2018-06-13/print
IBD:
https://www.investors.com/market-trend/stock-market-today/tech-stocks-gains-fade-fed-raises-interest-rates/
CNBC:
https://www.cnbc.com/2018/06/13/us-stock-futures-dow-data-fed-decision-and-politics-on-the-agenda.html
Bonds:
https://www.cnbc.com/2018/06/13/bonds-and-fixed-income-investors-turn-to-fed-rate-decision.html
Currencies:
https://www.reuters.com/article/uk-global-forex/dollar-mixed-ahead-of-feds-interest-rate-decision-idUSKBN1J902K
Oil:
https://www.cnbc.com/2018/06/12/oil-markets-prospect-of-rising-supplies-in-focus.html
Gold:
https://www.cnbc.com/2018/06/12/gold-markets-fed-decision-in-focus.html
WSJ: Markets At A Glance:
http://markets.wsj.com/us
SPDR's Sector Tracker:
http://www.sectorspdr.com/sectorspdr/tools/sector-tracker
SPDR's Bloomberg Sector Performance Pie Chart:
https://www.bloomberg.com/markets/sectors
Current Futures: Mixed
https://finviz.com/futures.ashx

Agree with above. Price was my first mutual fund manger ever in 1989. I stuck with them thru Mutual Series and switched to MDISX. My capital gains now are such that while I am disappointed it hasn't continue to excel, it hasn't done badly so I sell a little every year.
I was excited to follow Winters to WGRNX but his performance has been really dissapponting so I sold years ago and haven't looked back

I suppose that this qualifies as a "Fund Discussion" as there are surely many funds which might provide such bonds.
There's a recent article in The Economist which has an interesting perspective on the subject. It suggests that "there is a large class of investors for whom long-dated Treasuries have an almost unique virtue. It may even include people who believe that 3% is far too low for a sensible long-term interest rate. It consists of holders of other riskier assets, such as stocks, houses (real estate generally??) or high-yield corporate bonds, who wish to hedge against falling prices in the event of a recession."
The article then mentions a few other more exotic possibilities, but goes on to say that"...buying Treasuries is less fiddly for no-nonsense investors. And this insurance policy pays 3% a year."
"Long-dated bonds offer the prospect of a bigger capital gain should recession strike." In the event of a recession and intervention by the Fed, "ten-year yields could plausibly fall to 1%, or so. Those who had bought at yields of 3% would secure a 17% capital gain. Not only would that cushion a fall in the price of stocks, it would provide the means to buy them while they are cheap."
I have to admit that I had never looked at this situation from that perspective, and I'd love to hear what anyone else on MFO has to say regarding this.

FYI: Wall Street has ridiculed passive investing for decades. The reason is obvious: Its profits—and for many firms, their very survival—are at stake. The criticism reached an absurd level when a team at Bernstein called passive investing “worse than Marxism.” The authors of the note wrote: “A supposedly capitalist economy where the only investment is passive is worse than either a centrally planned economy or an economy with active market led capital management.”
Regards,
Ted
http://www.etf.com/sections/index-investor-corner/swedroe-passive-investing-demonized

How would you like to have accounts at FlagStar bank?
Wells Fargo is exiting retail banking operations in three Midwestern states as the beleaguered company follows through on previous plans to reduce the number of locations it has open.
The San Francisco bank said Tuesday that it will sell 52 retail bank branches in Indiana, Michigan, Wisconsin and Ohio to a Flagstar Bancorp subsidiary, as well as several branches in Wisconsin.
Financial terms were not disclosed. Almost 500 employees will be get job offers from Flagstar.
Wells Fargo & Co. has said it will reduce to approximately 5,000 the branches it operates by the end of 2020.
https://www.pbs.org/newshour/economy/social-security-trust-fund-will-depleted-17-years-according-trustees-report

https://www.sec.gov/Archives/edgar/data/1614812/000116204418000369/avon497201806.htm
Avondale Core Investment Fund
(COREX)
a Series of Avondale Funds
Supplement dated June 5, 2018
to the
Prospectus and Summary Prospectus dated February 28, 2018
____________________________________________________________________________
This Supplement to the Prospectus (the “Prospectus”) and Summary Prospectus for Avondale Core Investment Fund (the “Fund”), a series of Avondale Funds (the “Trust”), dated June 5, 2018, updates certain information found in the Prospectus and Summary Prospectus of the Fund dated February 28, 2018, as amended through June 5, 2018 as described below.
The Board of Trustees of the Avondale Funds has determined that it is in the best interests of the Fund and its shareholders to close the Avondale Core Investment Fund effective June 15, 2018 (“Liquidation Date”).
Effective immediately, the Fund, pursuant to a Plan of Liquidation (“Liquidation”) approved by the Board of Trustees, will not accept any new investments and will no longer pursue its stated investment objective. The Fund will begin liquidating its portfolio and will invest in cash equivalents until all shares have been redeemed. Any capital gains will be distributed as soon as practicable to shareholders and reinvested in additional shares, unless you have previously requested payment in cash. Shares of the Fund are otherwise not available for purchase.
Accordingly, the prospectus has been amended:
Suspension of Sales. Effective immediately, the Fund will no longer accept orders to buy shares of the Fund from any new investors or existing shareholders.
Prior to June 15, 2018, you may redeem your investment in the Fund, including reinvested distributions, in accordance with the “How to Redeem Shares” section in the Prospectus. Unless your investment in the Fund is through a tax-deferred retirement account, a redemption is subject to tax on any taxable gains. Please refer to the “Tax Status, Dividends and Distributions” section in the Prospectus for general information. You may wish to consult your tax advisor about your particular situation.
ANY SHAREHOLDERS WHO HAVE NOT EXCHANGED OR REDEEMED THEIR SHARES OF THE FUND PRIOR TO JUNE 15, 2018 WILL HAVE THEIR SHARES AUTOMATICALLY REDEEMED AS OF THAT DATE, AND PROCEEDS WILL BE SENT TO THE ADDRESS OF RECORD. If you have questions or need assistance, please contact your financial advisor directly or the Fund at 1-800-564-3899.
IMPORTANT INFORMATION FOR RETIREMENT PLAN INVESTORS
If you are a retirement plan investor, you should consult your tax advisor regarding the consequences of a redemption of Fund shares. If you receive a distribution from an Individual Retirement Account or a Simplified Employee Pension (SEP) IRA, you must roll the proceeds into another Individual Retirement Account within sixty (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 receive a distribution from a 403(b)(7) Custodian Account (Tax-Sheltered account) or a Keogh Account, you must roll the distribution into a similar type of retirement plan within sixty (60) days in order to avoid disqualification of your plan and the severe tax consequences that it can bring. If you are the trustee of a Qualified Retirement Plan, you may reinvest the money in any way permitted by the plan and trust agreement.
**********************
Shareholders should read this Supplement in conjunction with the Prospectus, as well as the Fund’s Statement of Additional Information, each as supplemented from time to time. These documents provide information that you should know before investing, and should be retained for future reference. These documents are available upon request and without charge by calling Mutual Shareholder Services at 1-800-494-2755.
Investors should retain this supplement for future reference.

Linked below is another stock market perspective from CNBC that calls for a year end target of 2800 (single digit stock market returns with bond yields heading higher). There is an investor survey with results at the end of the article.
https://www.cnbc.com/2018/06/03/double-digit-stock-market-gains-not-in-cards-citis-levkovich-says.html

@Puddnhead: FMIJX and whatever class of Euro Pacific Growth is in my TIAA have large European holdings and mediocre performance. BCSVX, on the other hand, has done really well in European SMIDs. MOTI, the wide-moat M* index international ETF, with 56% in Europe has not held on to last year’s strong gains. The French CAC has been stuck around 5400 for what seems like eons. I would not put new dough into a European index fund, but I did trim my under-performers and add to BCSVX.

David provides an interesting profile of Centaur Total Return (TILDX). The returns, risk-adjusted, are enticing; for my part, I avoid funds with ruinous ER's (2.10%) and high turnover ratios (over 100%). This fund has saddled owners in taxable accounts with huge short-term capital gains distributions in recent years. Last year's total distribution was $1.48 at NAV of $12.90, for example. Maybe other prospective customers have seen the same drawbacks as they have stayed away.

I have always believed that a "core" fund was one upon which you built the rest of your portfolio around. It would be your largest position sometimes along with one or two others of similar size. As slick noted at the beginning of this post UMBIX - Columbia Value & Restructuring was a popular forerunner in this form of contrarian investing i.e. companies that were temporarily unpopular, underperforming or unappreciated due to some internal event/stumble by management. David Williams was the manager when I first invested in UMBIX and darn good at what he did until the style fell out of favor. I would have to say that it was a core holding of mine at the time along with FCNTX - Fidelity Contrafund and PRWCX - T. Rowe Price Capital Appreciation fund.

Thanks Lewis. I get it and saw that as I went from balls to the wall long this fund to have a small position. The issue is 2 yr treasury is 2.6% with zero risk and I would think they should be able to make 4% given small risk of capital loss here (certainly compared w/ treasury or cd)

FYI: This week, we speak with famed short seller Jim Chanos, founder and president of Kynikos Associates LP, the world’s largest exclusive short-selling investment firm.
Chanos has identified — and sold short — many of the past 3 decades best-known corporate disasters. His celebrated short-sale of Enron shares was dubbed by Barron’s as “the market call of the decade, if not the past 50 years.” He also made bets against Baldwin-United, Commodore International, Coleco, Integrated Resources, Boston Chicken, Sunbeam, Conseco, Tyco International, and most recently, Valeant Pharmaceuticals.
He explains why he believes Elon Musk’s first love is SpaceX, and that “Tesla is a zero.”
Chanos said that when he launched Kynikos, there were a few 100 hedge funds, only 20 or 30 of which generating alpha. He presently sits on a number of boards where he helps to allocate capital. Market participants have gotten better, the landscape has become more competitive, and the funds have turned into large 300-person businesses. Despite 11,000 hedge fund choices, today there are even fewer hedge funds outperforming.
He asks, via Julian Robertson, the all important question “What is your edge.” Most managers lack a sustainable edge — trading, research, deviant perception — as reversion to mean is such a powerful process.
Regards,
Ted
http://ritholtz.com/2018/05/mib-jim-chanos-edge/

@Anna, if you happen to be dealing with TRP target date funds, they offer 2 options, but to me don't explain them well. They have for instance a 2020 "Target Date" fund that does change allocation as you get older. But they also have a "Retirement" fund that holds at it's allocation.
Example:
TRRBX 2020 retirement fund 37/20/40 US stock/Int stock/bonds
TRRUX 2020 target date fund 28/15/52 US stock/Int stock/bonds

Right now he's at Vanguard. I'll look to see if they have comparable offers. Thanks.

@Anna, if you happen to be dealing with TRP target date funds, they offer 2 options, but to me don't explain them well. They have for instance a 2020 "Target Date" fund that does change allocation as you get older. But they also have a "Retirement" fund that holds at it's allocation.
Example:
TRRBX 2020 retirement fund 37/20/40 US stock/Int stock/bonds
TRRUX 2020 target date fund 28/15/52 US stock/Int stock/bonds