True. But, most HY, active managed funds remain flat/neutral at this time for pricing.
If the pricing remains the same going forward for a sustained period, an investor may still find a yield range of 5-6%. The capital appreciation may not be in place as during the past several years.
Today (with the crazy upward moves in global equity markets) may provide some more clues for the HY sector. Although one should consider that if the flows to equities remains strong, some of these monies may not travel the HY road right now.
Take care,
Catch

FYI: Junk bond investors who held their nerve through this month’s global selloff have recouped all their losses as the riskiest part of the corporate credit market again demonstrates its resilience.
Led by healthcare company debt, speculative-grade notes have returned 1.88 percent since the middle of the month,, according to Bank of America Merrill Lynch’s Global High Yield index. The rebound erased losses of 1.16 percent from the first two weeks, leaving gains for October at 0.71 percent.
Regards,
Ted
http://www.bloomberg.com/news/print/2014-10-31/junk-bond-bulls-outlast-october-swoon-as-losses-wiped-out.html

For those interested, I just got word of the impending Akre call. It's trick-or-treat day here so I'll be dashing about prepping the house for that so I won't be able to listen in but I thought some of you might enjoy being there.
David
AKRE FOCUS FUND MANAGERS WILL HOLD INVESTOR CALL THIS THURSDAY, OCTOBER 30th
Middleburg, VA-based Akre Capital Management will hold a conference call with portfolio co-managers of the Akre Focus Fund (AKREX) tomorrow, October 30, at 4:00 pm EDT to update investors on the fund’s portfolio. After initial remarks, there will be a Q&A session with the investment team, including chief investment officer Chuck Akre, and partners Tom Saberhagen, John Neff and Chris Cerrone.
To join the conference call:
Dial In: (877) 509-7719
Conference ID: 98245829
To submit a question for the Q&A session in advance, please email your questions to questions@akrecapital.com no later than 5:00 pm EST on Wednesday, October 29.
Additionally, the firm now has some new and interesting material available on the new web site about the investment process, the team’s thought process and some of the issues they focus on -- here is the link to that page -- http://www.akrecapital.com/our-thinking/

Can I assume this is a long term buy and hold strategy? At first glance, most funds are good. Most funds are large (more than 10B AUM) Do you invest in VDGIX or VDIGX?
I'd only keep 2 out of these four funds (maybe VDIGX and FPACX):
Vanguard Dividend Growth Inv 13.57
FPA Crescent 10.37
Vanguard Capital Opportunity Inv 6.38
Vanguard Selected Value Inv 5.68
I'd split VHGEX into GGPOX, ARTGX, and MACSX
I'd consider adding a domestic small cap fund.

A very good day everywhere. Asia closed almost a solid green with Australia being the only down market and just slightly so. Europe is green across the board. Worries of QE ending seem to be non-existent. A story ran today that Abe's program may not be working but that didn't stop the Nikkei from posting a solid gain. Most markets had better than 1% gains.
All the best in your investing ventures today.

Friends,
Here is my portfolio. Please let me know your review comments.
Some of the funds like VGSTX is there because I have no other choice. I recently sold SFGIX to put more money into ARTKX. I prefer SFGIX over MACSX due to its diversity, and would buy it to replace MACSX at some point in future.
Fund Name % Weight
************ *********
Vanguard Dividend Growth Inv 13.57
FPA Crescent 10.37
Vanguard Global Equity Inv 10.16
Akre Focus Retail 9.23
Whitebox Tactical Opportunities Investor 7.96
Grandeur Peak Global Opportunities Inv 6.92
Grandeur Peak Emerg Mkts Opps Inv 6.7
Vanguard Capital Opportunity Inv 6.38
Artisan Global Value Investor 6.26
Vanguard Selected Value Inv 5.68
Artisan International Value Investor 3.5
Wasatch Frontier Emerg Sm Countrs Inv 3.32
Matthews Asian Growth & Inc Investor 3.31
T. Rowe Price Health Sciences 2.98
Vanguard STAR Inv 2.28
Templeton Russia & East Europe Common 1.38
Total 100

I looked at RGHVX lagging performance in each of as many dip periods as I could, granular and higher-level, brief and less brief, and have decided to bail, fwiw (and it's not included in the above website obvs).
They once wrote
\\\ Objective and strategy
\\\ RiverPark/Gargoyle Hedged Value seeks long-term capital appreciation while exposing investors to less risk than broad stock market indices. ... In theory, the mix will allow investors to enjoy most of the market’s upside while being *buffered for a fair chunk of its downside.*
Emphasis mine. Fail is my judgment. Something strange going on consistently in the implementation.
(Now if someone can explain why DSENX has done well through recent volatility.)

Both HQL and FBIOX hold similar companies in the biotech/genetics sphere. That is but one sector within healthcare. That sector is also showing the big gains. One reason is that sector is showing some stability compared to yesteryear when tiny companies were doing the leg work on one drug, a kind of all or nothing venture. Now the bigger companies are taking center stage and with multiple drugs/treatments in their pipelines can withstand the shock of a failure a bit better.
This sector of healthcare is where the biggest money is, compared to imaging diagnostics or software solutions etc.

I wonder whether many investors will move to ETFs from their funds in taxable accounts after being hit by large taxable distributions this year, or at least send their new money to ETFs from now on.

I think more investors will move either to traditional index mutual funds, or their ETF counterparts, after seeing large capital gain distributions. Especially since the index funds and indexed ETFs most likely will have no capital gains distributions, and just as good and probably better performance. Or as you said, at least with new money.
"Stock fund investors could be harder-hit, said Morningstar analyst Russel Kinnel. He estimates that U.S. domestic stock funds might be sitting on gains of around 20 percent and could end up paying 16 or 17 percent of their value to shareholders as gains."

Yes. I just identified a (small) holding of mine left over from 2004 where the NAV appreciation over the decade is so low and the projected distribution so high that selling now is basically a wash.
I get $N in cap gains by selling now, or $N in a combination of cap gains and ordinary income by holding. Obviously selling is better - same income, but 100% of it is long term cap gains.
Only problem in selling now is that I don't want to buy a dividend with the proceeds.
As someone else posted in this thread, it looks like small caps are likely candidates for a further sell off (making the actual dividends even worse that current projections).

The investor does not make money on a capital gain realized and paid out by a fund. When the gain is paid out (either in cash or shares), the NAV of the fund decreases by the same amount. But the investor has to pay taxes on this "gain". When the investor sells the fund, he doesn't have to pay gains on the gains paid earlier.
Paying taxes on an actual gain that I realized when I sold a fund has never been a problem.
Dave

Are investors (in the U.S.) the ONLY people who make money (capital gains) then bitch about it...?
I've never heard a ditch digger say "well I'd dig another ditch but you know I'm going to have to pay taxes" just wondering?

TB,
As I recall, Massachusetts colonists ignited the formation of this country based on an individuals right to bitch about taxes (Boston Bay Tea Party). I, for one, am glad they did.
Article does reference your point (I assume you read the article). Stopping your comment there makes me think you didn't. We all pay taxes.
To me, the article's focus on the long term capital gains (holding periods of longer than a year) is worthy of exploration. As investors, we should understand the potential impact of taxes on our investments. I hold many of my investments in Roth IRAs for this very reason.
As for LT capital gains, many mutual funds have carried over tax losses from the 2009 recession that in large part have offset subsequent LT gains. This dynamic may be ending as gains have now out paced losses (We are back were we started and then some).
Paying taxes unnecessarily is something I aim to guard against. Many of us don't think in terms of "after tax gains" until "after we are taxed" on our gains.

Are investors (in the U.S.) the ONLY people who make money (capital gains) then bitch about it...?
I've never heard a ditch digger say "well I'd dig another ditch but you know I'm going to have to pay taxes" just wondering?

FYI: (Follow-Up Article)
If you are the kind of steadfast investor who buys a mutual fund and holds it forever, prepare to pay for your loyalty next April, when you settle up your 2014 tax bill.
At the end of this year, many mutual funds are expected to distribute sizeable capital gains to shareholders who will have to pay taxes on them.
Regards,
Ted
http://www.reuters.com/assets/print?aid=USKCN0IA1X220141021

Hi Mo,
Interesting. In the north west part of the Upper Peninsula, is what's called Copper Country. Mined it there until it got too deep to be cost/beneficial. It is what is known as float copper that people still find today.
https://www.google.com/search?q=float+copper&biw=1920&bih=899&tbm=isch&tbo=u&source=univ&sa=X&ei=GptNVKPfO8iPyATlrYLgBQ&sqi=2&ved=0CEMQsAQ
I've seen that big rascal in Calumet. Back in the 1850's it was in line to be the state capital as it was the home of the copper boom. They chose Lansing because it was centrally located.
and so it goes,
peace,
rono

FYI: (Click On Article At Top Of Google Search)
By weighting its bets on factors other than just size, Sprott Gold Miners improves chances for gains.
Regards,
Ted
https://www.google.com/search?newwindow=1&site=&source=hp&q=a+gold+etf+barron's&oq=a+gold+etf+barron's&gs_l=hp.3...1812.10654.0.11115.19.18.0.1.1.0.97.1401.18.18.0....0...1c.1.56.hp..7.12.905.WjZPBtBjv7Y

FYI: NEW YORK (MarketWatch) -- U.S. stocks closed with solid gains Friday, handing the S&P 500 SPX, +0.71% its largest weekly advance of 2014. Investors shrugged off worries about New York's first Ebola case, which had weighed on U.S. stock futures.
Regards,
Ted
http://www.marketwatch.com/story/stocks-end-higher-sp-500-nabs-biggest-weekly-gain-of-year-2014-10-24/print
Markets At A Glance: http://markets.wsj.com/us
WSJ Slant: http://online.wsj.com/articles/u-s-stock-futures-trade-lower-1414153540

FYI: (Click On Article Title At Top Of Google Search)
Janus Capital Group Inc. Chief Executive Richard Weil on Thursday called his surprise hiring of bond kingpin Bill Gross last month “the press release heard around the world,” but said it was too soon to know the impact on the fund firm’s business.
Janus earlier in the day said that its third-quarter profits rose 25% over the prior year, but the firm’s executives didn’t attribute the gain to Mr. Gross’s arrival. They also said they wouldn’t provide any data on fund inflows until next month.
Regards,
Ted
https://www.google.com/search?newwindow=1&site=&source=hp&q=janus+profits+wsj&oq=janus+profits+wsj&gs_l=hp.3...1300.7466.0.8185.17.17.0.0.0.0.67.937.17.17.0....0...1c.1.56.hp..6.11.653.fKIIcceEEOU

Couple of notes if I may. CLSIX/CLVSX is a L/S fund in Real Estate category. So its more narrowly focused.
FMLSX is a DIRECTIONAL L/S fund. I think it sorta tries to capture 80% of upside and 60% of downside and tries to win as a result. I think most other L/S funds are like that too, but do not advertise it that way and claim to "preserve capital" and "provide downside protection" skewing investor perception.
There are some newer L/S funds that have performed well, but largely only being LONG in the bull market. They should be viewed with suspicion. Similarly there are others that have sucked up the place, but may really end up being good long term holdings. It would really help to get some insight into the management of these funds before making any decisions.
I thought I had found a keeper in TFSMX. I have held it for some time and TFSHX I have held since inception, only because of my familiarity with TFS. Now I have to rethink based on what I learnt on this thread.