Thanks David for another great commentary. I especially liked your timely feedback from Eric Cinnamond.
I didn't add a comment on Shadow's post about ARIVX re-opening because it was confusing to me. What was the reason for opening a fund with so much cash on hand? Some were bashing a fund that fits to a tee what I want in an equity investment, capital preservation at the forefront and a proven smart manager. A fund with a goal of out performing the market over a full economic cycle. Not a fund that tries to shoot the lights out in good times but pays the piper in bad.
ARIVX has become one of my favorites, along with YAFFX and MACSX, because they all seem to have the investment goals my risk tolerance relates too.

http://www.sec.gov/Archives/edgar/data/869351/000120928612000416/e1195.htm
BROWN CAPITAL MANAGEMENT MUTUAL FUNDS
The Brown Capital Management Small Company Fund (the “Fund”)
Supplement dated August 31, 2012 to the Fund’s prospectuses dated July 30, 2012
Effective September 4, 2012, The Brown Capital Management Small Company Fund will re-open for investment to all investors who wish to purchase Fund shares. All references in the Fund’s prospectuses disclosing that the Fund is closed to new investors are hereby deleted.
Brown Capital Management Mutual Funds
1-877-892-4BCM
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE

Perpetual Bull posted the link earlier in reference to another fund, but I thought this bit from Pimco EQS Long/Short (PHMDX) was well put in terms of describing the fund's long/short philosophy.
"We short stocks when we identify opportunities to generate alpha as
opposed to simply hedging market risk. Companies we short tend to
fall into two categories: Fundamental shorts, or companies in secular
decline, and cyclical shorts, or businesses that will likely be most
impacted by a weakening economy.
When our outlook is bearish and our objective is to reduce equity
market exposure, moving to cash is usually our first line of defense. In
bear markets, the Fund can go 100% into cash and cash equivalents
in an effort to avoid downside risk. To help preserve investors’ capital,
in September 2008, for instance, we were invested mostly in cash and
cash equivalents.
In addition, our approach is consistent with the needs of many
investors who are moving away from benchmark-oriented strategies in
favor of highly active, unconstrained approaches that seek to limit
downside risk."
https://materials.proxyvote.com/Approved/MC0059/20120813/AR_139608.PDF

Reply to @scott: Hi Scott. We have a lot of client dollars in MFLDX. It is pretty much a core hold in our alternative strategies allocation. When it becomes part of MainStay, the no-load, NTF shares will only be available to existing retail shareholders. That is the official word from Marketfield management. RIAs with accounts in MFLDX will be able to add new accounts, but this does not apply to retail investors.
We have some dollars in Forward Tactical Growth FTGWX. Because it uses specific indicators in making its long-short decisions, it can be (and has been) whipsawed in choppy markets. It does better in longer periods of market decline. They did a great job in 2010's second quarter and 2011's third quarter. But in both cases, their model did not turn quickly enough to prevent losses in the subsequent quarters, when the stock markets had nice gains.
We have looked briefly at KeeleyKALIX, but are skeptical of a two-person family team capably running five different funds, especially when there does not appear to be a history of running long-short investments. It could be this will be a fine option, but Keeley funds seem to do great out of the gate, then less so as they grow assets.
Another option is Wasatch FMLSX, which has been around since 2003. It is less aggressive in both its long and short calls than MFLDX. But it runs a decent second to MFLDX. Forester FVALX has sort of morphed from a large cap value fund to a long-short fund in M*. It hardly moves at all from day to day, as Tom Forester is extremely conservative. It is the only equity fund to have gained anything in 2008, but it is more of a capital preservation strategy than long-short. Then there is Hussman HSGFX, which has been a disaster because of the manager's fear of everything. He will undoubtedly be right at some point, but I cannot imagine hanging around this fund long enough to realize that.

I'm attempting to get out of osdfx. It has redeeming qualities, so I'm selling. Not so fast. Telephone redemptions are not allowed and I was told to produce a 'letter of intent,' take it to my bank for a signature guarantee. When I did just that, the bank manager, someone I've known for some time, wouldn't take it, claiming that she needed a form instead. She found one, online. The people at MSS, the administrator, apparently did not know about the available download and claim that they receive handwritten notes all the time for redemptions, which I seriously doubt. Can't get that guarantee at the bank that easily, Fed regs and all. Just be aware that Oceanstone is not an easy exit or other sale fund. Easy to purchase shares though.
However, I did print out a list of funds that are administered by MSS and one caught my eye: the Matthews 25 Fund. It's YTD is at 28.23%. Anyone out there have or care to venture an opinion? $10,000 minimum, interesting statement from 2011. It's chart looks compelling as well. And Oceanstone? At the bottom of the sea right now, IMO. $10000 is a lot to part with, but the gains look great. It's a small fund, so it might be a good fit in MFO. Please, I could use an opinion here on a seldom followed fund.

Hi folks...new poster here.
Similar to Kenster, I hold several Matthews funds including MACSX and MAPTX. I swapped MAPIX for SFGIX a short time ago. I hope to find Mr. Foster's comments illuminating relative to the original question as to viability, as this has been a personal concern for a few weeks.
Two points:
A comment was made comparing SFGIX with Eric Cinnamond's fund, ARIVX. Given the fact that Mr. Cinnamond joined a fairly well established asset management firm, I believe a more apt comparison might be to the Grandeur Peak funds...a new firm created by a few Wasatch boys. I hold the Global option, GPGOX.
They opened 2 funds in October of last year, as readers of this forum would certainly know.
New firm...new funds...but now with almost $240M under management.
Secondly, and unfortunately for Mr. Foster, I think that fund flows may be light for the remainder of the year given my interpretation of investor behavior.
If someone wants a foothold in the foreign/EM space off the beaten track and doesn't read all available materials, I do believe that the average investor would consider Matthews over Seafarer for this role if comparing the funds side by side...for the overly simplistic reason that they would do a YTD comparison of the funds.
SFGIX launched in the latter part of February of this year....when the lion's share of Matthew's gains were already made when looking at the month by month returns.

Hi Andrei,
Thanks for expounding more upon this, it is indeed appreciated as I would like to learn more on what Hulber has to offer. Could you please provide a link to Hulbert's commentary and his assesment? In this way, I know I am reading the right detail and the same that you formulated your perspective from.
Andrei, I hope you have a great afternoon. It is a pleasant day here in Carolina ... Blue sky, and temperatures in the 70's. So for me, it is off to the golf course for a Sunday afternoon scramble with my golfing friends. I'll be back and check the board this evening in hopes I can be read more on Hulbert's comments about Mr. Rowland. A link would be of a great aid in me doing this.
My thoughts of Mr. Rowland are not fixed by any means ... and, are subject to be changed, if warranted. But, for of now ... His Leadership Strategy that I frequently reference and use ... Well, it is one of his strategies that I feel has done right for me. I indeed find it a useful tool in moving some of my ballast money around ... and, it is free with no fee as with his other strategies that he has formulated and sells. Sometimes the simple strategies turn out to be the best. And, as you have found out a strategy works until it doesn't work anymore because the table has become crowded by too many investors using it. After all, market conditions do change and strategies that were employed during these prevailing conditions no longer seem to apply with intendended production results that they once did ... and/or, too many began to employ them. Therefore, one needs to be on alert to spot strategies that might be going dead.
Again, I am sorry to learn of your losses ... but, I am afraid loss of principal is a part of investing as investing does entail some risk taking. Uncle Sam does allow for a deduct for investment loss on his annual income and tax reporting forms that most of us have to file each year. Perhaps, this might afford you some small relief. I know this first hand as I have filed for loss relief myself at times on my own tax returns. In the long run though, I am net positive and I have to pay on my net realized net gains after taking into account losses. Thus far, I am usually net positive each year ... although I am carrying over some booked losses form the great recession. I guess, a lot of us still are. Perhaps, a tax accountant can provide you more information on this.
Andrei, I hope you have a pleasant afternoon and may the sun shine upon you.
Cordially,
Skeeter

Note only that but numerous Analysts have left too.
From M*
=====
Doug Rao, manager of Marsico Flexible Capital (MFCFX) and comanager of flagship funds Marsico Growth (MGRIX) and Marsico Focus (MFOCX), is leaving Marsico Capital Management on July 20, 2012. His is the latest in a series of departures from the firm over the last two years. Jordan Laycob and Munish Malhotra, who've been at the firm since 1997 and 2004, respectively, will comanage Flexible Capital. Firm founder Tom Marsico remains lead manager and Coralie Witter comanager on Growth and Focus. Joshua Rubin, a comanager on Marsico Emerging Markets (MERGX), also announced he was departing.
Rao joined Marsico Capital Management in 2005 and moved up the ranks quickly, taking over as manager of Flexible Capital in 2007. He made ample use of that fund's go-anywhere mandate, holding roughly 20% in cash in 2008 and one third of assets in non-United States stocks, including some emerging-markets picks, in 2009. Such moves helped fuel the fund's dazzling gains compared with its large-growth peers--as well as the world allocation category average--during his five-year tenure. Following Cory Gilchrist's departure last fall, Rao was the firm's most experienced U.S. equity manager after Marsico.
Rao's successors are less experienced. Laycob has been a Marsico analyst since 1997 and the firm's sole fixed-income specialist, but he's never run a fund before. Malhotra has been a comanager of the $5 million Marsico Emerging Markets fund since its late 2010 inception, but that fund has lagged its diversified emerging-markets peers and the MSCI Emerging Markets Index since its birth and it has seen a lot of manager turnover. Rubin, who had been a manager on Marsico Emerging Markets since 2010, resigned just two months after comanager Charlie Wilson left the firm.
Turnover has also struck the analyst team. Seven team members who joined between 2003 and 2008 have left since 2010. Five new analysts came on board since last year, but only one had previous investment experience. The firm's troubles attracting and retaining talented investors coincides with financial woes. Marsico bought his firm back from Bank of America (BAC) in a highly leveraged deal in 2007, just before the 2008 market meltdown and investor outflows depleted the firm's asset base. As a result, the company restructured its debt in 2010. The firm's inability to retain and attract experienced investors has undermined investor confidence. Indeed, the firm is on pace for its fourth straight calendar year of significant outflows. Since 2008 through the end of June 2012 the firm has seen more than $5 billion leave its mutual funds and has lost outside subadvisory deals. Recently, John Hancock fired Marsico as the subadvisor for John Hancock Funds II International Opportunities (JIIOX), citing disappointing performance. John Hancock has hired a team at Invesco led by Clas Olsson to replace Marsico and eventually plans to merge the fund into John Hancock Funds II International Growth Stock (JGSNX), which Olsson and his team have managed since 2010.

As you know, Douglas Rao quit Marsico and went elswhere.
The managers who took over have not done well with other funds at Marsico.
Consesus opinion that I gathered here as well as at M*, wait and watch until there is a proof that peformance is deteriorating . My concers is that Harbor is liquidating its flexible capital fund, which was also managed by Rao. Looks like, either they do not have enough confidence in replacement mgrs or they have not collected enough assets and liquating it. I think it is the former rather than later.
Pls. let me know your thoughts.
Thanks,
Mrc

Is this worth buying in a taxable account with potential for high turnover and short term cap gains?

My son declines to comment as to the source of his money market exposure. I believe it to be a perk granted by his employer, HSBC. Rank has its' priviledges, as they say. He is out the the market, says that it is too risky per the potential gains, both stocks and bonds.

Reply to @Old_Joe: I think the issue that I have with the fund is that HSGFX is not a vehicle that could really capitalize on a downtrend that well if the market tanked tomorrow. Given the nature of the fund, a 12% loss in this fund could take a while to regain. The fund had double digit gains in 2002/2003, but has barely moved much either way on a yearly basis since then.

http://www.advisoranalyst.com/glablog/2012/08/20/confidence-and-enthusiasm-hussman/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+advisoranalyst+(AdvisorAnalyst+Views)
http://www.usfunds.com/media/files/pdfs/investor-alert/-2012-ia/2012-08-17/investor_alert-08-17-2012.pdf?utm_source=SubscriberMail&utm_medium=email&utm_campaign=IA-08-17-2012&utm_term=Download PDF Version&utm_content=c35a4e567cd7466eaaf4f1a8d1df0917
RBC: Market Week: August 20, 2012
The Markets
Equities had a sixth consecutive week of gains, with the small caps of the Russell 2000 leading the way for a change. The S&P 500 ended the week only a single point away from its year-to-date closing high, and the Nasdaq continued to be the best performer of 2012. Meanwhile, renewed appetite for risk left the 10-year Treasury yield only 8 points from where it began the year.
RBC WEEKLY COMMENTARY
Market/Index 2011 Close Prior Week As of 8/17 Week Change YTD Change
DJIA 12217.56 13207.95 13275.20 .51% 8.66%
Nasdaq 2605.15 3020.86 3076.59 1.84% 18.10%
S&P 500 1257.60 1405.87 1418.16 .87% 12.77%
Russell 2000 740.92 801.55 819.89 2.29% 10.66%
Global Dow 1801.60 1880.18 1893.85 .73% 5.12%
Fed. Funds .25% .25% .25% 0 bps 0 bps
10-year Treasuries 1.89% 1.65% 1.81% 16 bps -8 bps
Equities data reflect price changes, not total return.
Last Week's Headlines
The Bureau of Labor Statistics said consumer prices saw no change in July, leaving the annual inflation rate at 1.4%. Energy costs, primarily for electricity, natural gas, and fuel oil, fell 0.3%, offsetting a 0.1% increase in food prices. Not including food and energy, core consumer inflation rose only 0.1% for the month.
U.S. industrial production was up 0.6% in July, according to the Federal Reserve. That was substantially higher than the 0.1% increases seen in May and June, and 4.4% higher than last July. Also, usage of the nation's manufacturing capacity rose to 79.3%; that's the highest level since April 2008. However, manufacturing activity in the Fed's Philadelphia and New York regions contracted by 7.1% and 5.9% respectively.
U.S. retail sales were up 0.8% in July. According to the Commerce Department, that was the first increase in four months and put sales 4.1% ahead of last July. Nonstore retailers were up almost 12% from a year ago, and sales of sporting goods, hobbies, books, and music rose almost 11% in the same time; both categories also saw the strongest monthly gains.
After a 6.8% increase in June, housing starts fell 1.1% in July, though the Commerce Department said they were still 21.5% higher than the previous July. Prospects for future construction improved as the number of new building permits increased 6.8% to hit a level that was almost 30% higher than July 2011.
The Conference Board's index of leading economic indicators continued to seesaw, rising 0.4% in July after June's decline and an increase in May. The biggest contributors were growth in housing permits and lower first-time unemployment claims.
Eye on the Week Ahead
With continued low trading volumes expected, economic reports from Europe could have as much impact as domestic data, while minutes of the Fed's internal debates about further economic stimulus also will receive attention.
Key dates and data releases: Federal Open Market Committee minutes, home resales (8/22); new home sales (8/23); durable goods orders (8/24).
http://www.pionline.com/gallery/20120819/SLIDESHOW2/819009999?utm_source=issue_alert&utm_medium=email&utm_campaign=alert_insider

Reply to @romroc: Just curious, romroc, but do you mean your son the banker thinks the stock market is about to tank, and if so, did he say why he then would be selling "his bond fund"?
Another lower volatility possibility, if you want to stay within the Price family, is PRWCX, Capital Appreciation, which is basically an aggressive allocation fund that's usually very heavy in stocks (but not right now - maybe in synch with your son's thinking!) and has a good long-term record. The schtick, more or less, is stock-equivalent returns with significantly lower volatility, and it's pretty much delivered on that strategy. I'd also do a 'me-three' on MikeM's suggestions as good choices.

In my attempts to slowly (key word "slowly") diversify away from junk I have tried to find bond funds with a hefty allocation to RMBS which have been improving with the rebounding housing markets. PONDX which is a favorite on this board fits the bill and where I have moved some of my capital. I can ramp up real quick if needed. The .70% daily move up a few days back was nice, especially for a bond fund. There was some news out Friday regarding Fannie Mae which could further help the RMBS market. One of this year's best performing bond fund (up almost 17%) and with one of the greatest portion of its portfolio invested in RMBS is Angel Oak Multi-Strategy Income Fund - ANGLX. It's available at most brokerage firms but the 5.75% load takes it off my radar screen. It has a C class without the load but a 1% exit fee but that class seems to be available only at Fidelity, or at least not available at Scottrade where my accounts are.

Howdy,
A thank you to all who post the links, start and participate in the many fine commentaries woven into the message threads.
For those who don't know; I ramble away about this and that, at least once each week.
NOTE: For those who visit MFO, this portfolio is designed for retirement, capital preservation and to stay ahead of inflation creep. This is not a buy and hold portfolio, and is subject to change on any given day; based upon perceptions of market directions. All assets in this portfolio are in tax-sheltered accounts; and any fund distributions are reinvested in the funds. Gains or losses are computed from actual account values.
While looking around..... Is this "As Good As It Gets" for bonds going forward? For some bond sectors, perhaps.Flip a coin, eh? Goldman Sachs (GS) noted in early 2010 that the 10 year note was going to a 5.5% yield and later kinda apologized for that notation. Course, "As Good As It Gets" applies to all investment sectors, too. Are some equities overbought? I sure don't know, but a likely guess would be, yes. GS has a year end number on the SP-500 at 1250. Should I trust that number any more that the other 100 market fortune tellers spouting any day of the week?
I suppose the best two words I read recently about the markets were "we are defensively bullish". Okay, how about "optimistically bearish", too. Perhaps this house just needs to select a broad base of the100 best funds or etf's, set the tickers upon a large sheet of paper, stand back 15 feet and let rip with 12 darts. Done and finished.
Per David Rosenberg, July 27, 2012........
*****Markets were thrilled yesterday when European Central Bank president Mario Draghi said he would "do whatever it takes to preserve the euro. And believe me, it will be enough".
But Gluskin Sheff economist David Rosenberg said these were Draghi's famous last words, much like when Hank Paulson had said in August 2008, "If you have a bazooka in your pocket and people know it, you probably won't have to use it."
Or when Ben Bernanke said in June 2008, "the financial crisis appears to be mostly behind us, and the economy seems to have stabilized and is expanding again."
Rosenberg said Draghi's words were pure rhetoric and he called Draghi a "leader of NATO - No Action, Talk Only - instead of a central bank".
Draghi's comments were widely interpreted as a return to the Securities Markets Program (SMP) which involves purchases of Italian and Spanish bonds. But Rosenberg said if this was in fact costless it would have been activated already.
He also poured cold water on talk about granting the European Stability Mechanism a banking license. "Frankly, this is likely to be a political decision in the end, which is beyond the purview of the central bank." And said a third LTRO (long-term refinancing operation) would do nothing more than buy some time.
Rosenberg argued that the underlying problem of Europe's sovereign and banking sector would ultimately hinge on its fiscal and regulatory policy and that there isn't much Draghi can do about it. *****
Personal note to the above: Mr. Draghi only mentioned saving the "euro"; nothing about saving any countries. Perhaps the "euro" will remain only in Belgium, the home of the ECB; into the future.
The data/numbers below have been updated.
As to sector rotations below (Fidelity funds); for the past week: (Note: any given fund in any of these sectors will have varing degrees of performance based upon where the manager(s) choose to be invested and will not directly reflect upon your particular fund holdings from other vendors.)
--- U.S. equity + .3% through + 2.4%, avg. = + 1.5% YTD = +13.8%
--- Int'l equity - 2% through + 1.6%, avg. = + .4% YTD = +9.2%
--- Fido Select. sectors - .8% through + 3.8%, avg. = + 1.3% YTD = +13%
--- U.S./Int'l bonds - 2.9% through + .12%, avg. = -.70% YTD = + 2.2%
--- HY bonds - .52% through + 0%, avg. = - .2% YTD = + 8.8%
An Overview, M* 1 Week through 5 Year, Multiple Indexes
I have added a few blips related to our portfolio and market observations at the below SELLs/BUYs and Portfolio Thoughts.
SELLs/BUYs THIS PAST WEEK:
NONE
Portfolio Thoughts:
Our holdings had a - .59 % move this past week. We'll stay where we are at for today; to find what the new week and perhaps the end of the month with Mr. Bernanke brings to the plate.
Sidenote: The average return of 200 combined Fidelity retail funds across all sectors (week avg = + .63%, YTD + 10.3%). I will retain the below write from previous weeks; as what we are watching still applies.
--- commodity pricing, especially the energy and base materials areas; copper and related.
--- the $US broad basket value, and in particular against the Euro and Aussie dollar (EU zone and China/Asia uncertainties).
--- price directions of U.S. treasury's, German bunds, U.K. gilts, Japanese bonds; and continued monitoring of Spanish/Italian bond pricing/yield.
--- what we are watching to help understand the money flows: SHY, IEF, TLT, TIP, STPZ, LTPZ, LQD, EMB, HYG, IWM, IYT & VWO; all of which offer insights reflected from the big traders as to the quality/risk, or lack of quality/risk; in various bond sectors.
I have retained the following links for those who may choose to do their own holdings comparison against the fund types noted.
The first two links to Bloomberg are for their list of balanced/flexible funds; although I don't always agree with the placement of fund styles in their categories.
Bloomberg Balanced
Bloomberg Flexible
These next two links are for conservative and moderate fund leaders YTD, per MSN.
Conservative Allocation
Moderate Allocation
A reflection upon the links above; we attempt to establish a "benchmark" for our portfolio to help us "see" how our funds are performing. Aside from viewing many funds within the balanced/flexible funds rankings (the above links), a quick and dirty group of 5 funds (below) we watch for psuedo benchmarking are the following:
***Note: these week/YTD's per M*
VWINX .... - .41% week, YTD = + 7.67%
PRPFX .... - .02% week, YTD = + 3.32%
SIRRX ..... - .13 % week, YTD = + 4.67%
TRRFX .... + .25% week, YTD = + 8.05%
VTENX ... + 0% week, YTD = + 7.13%
Such are the numerous battles with investments attempting to capture a decent return and minimize the risk.
We live and invest in interesting times, eh? Hey, I probably forgot something; and hopefully the words make some sense. Comments and questions always welcomed.
Good fortune to you, yours and the investments.
Take care,
Catch
---Below is what M* x-ray has attempted to sort for our portfolio, as of June 1, 2012---
From what I find, M* has a difficult time sorting out the holdings with bond funds.
U.S./Foreign Stocks 1.9%
Bonds 93.9% ***
Other 4.2%
Not Classified 0.00%
Avg yield = 3.72%
Avg expense = .55%
***about 16% of the bond total are high yield category (equity related cousins)
---This % listing is kinda generic, by fund "name"; which doesn't always imply the holdings, eh?
-Investment grade bond funds 28.2%
-Diversified bond funds 22.4%
-HY/HI bond funds 14.5%
-Total bond funds 32.4%
-Foreign EM/debt bond funds .6%
-U.S./Int'l equity/speciality funds 1.9%
This is our current list: (NOTE: I have added a speciality grouping below for a few of fund types)
---High Yield/High Income Bond funds
FAGIX Fid Capital & Income
SPHIX Fid High Income
FHIIX.LW Fed High Income
DIHYX TransAmerica HY
---Total Bond funds
FTBFX Fid Total
PTTRX Pimco Total
---Investment Grade Bonds
ACITX Amer. Cent. TIPS Bond
DGCIX Delaware Corp. Bd
FBNDX Fid Invest Grade
FINPX Fidelity TIPS Bond
OPBYX Oppenheimer Core Bond
---Global/Diversified Bonds
FSICX Fid Strategic Income
FNMIX Fid New Markets
DPFFX Delaware Diversified
LSBDX Loomis Sayles
PONDX Pimco Income fund (steroid version)
PLDDX Pimco Low Duration (domestic/foreign)
---Speciality Funds (sectors or mixed allocation)
FRIFX Fidelity Real Estate Income (bond/equity mix)
---Equity-Domestic/Foreign
NONE outright, with the exception of equities held inside of some of the above funds.

Reply to @ducrow:
Happy to help! Some thoughts
1. New fund. A hedge fund may not always translate to a good mutual fund. See NARFX (which was sold and turned into another fund.) Not comparing management of NARFX to this fund or anything, but I suppose it's a belief that a hedge fund strategy does not always carry over to the mutual fund world. However, the Whitebox fund is doing well so far.
2. FPA Crescent (FPACX) may have a couple of issues (structural - it could probably close), but I think it's still an excellent fund with a great manager in Romick (whose views I continue to agree with a great deal.) Personally, I don't know if I'd replace it or if this is an apples-to-apples replacement. The Whitebox fund is a new fund, but I think this is going to be a unique/unusual offering in that part of the stock holdings may be broad, but there may be a sizable portion in contrarian ideas/plays/themes - a further discussion by the manager regarding his nat gas theme is available in this Barrons article (http://www.forbes.com/sites/steveschaefer/2012/05/31/why-it-might-finally-be-time-for-natural-gas-to-make-a-comeback/)
Also note, from the Whitebox quarterly report: "Our fund is not currently “market neutral.” We have a strong “long-bias”. At
other times we may have a strong short bias. Our returns will reflect at least a
portion of day to day, normal market volatility. Our goal is to outperform not by
delivering smooth returns all the time. Our goal is to outperform by doing two
things. (1) Avoiding catastrophic capital losses that can derail an investment
program for years, or forever. (2) Being invested in areas of exceptional
opportunity wherever in securities markets those opportunities arise."
So, the fund definitely has the flexibility to dial up and down risk, to the point where it can have a "strong short bias."
3. Amusing name. Whitebox is a play on the opaque "black box" strategies that hedge funds often have. Their big thing is being transparent with shareholders in communications and otherwise.
4. Again, while the hedge fund may be highly regarded, new mutual fund. However, there is a lot available online about the manager. Their "Whitebox Selected Research" is enjoyable reading, both from the articles from others and the articles from Whitebox. Redleaf wrote a book, "Panic", about the financial crisis, which does not appear to be available new anymore from amazon, but is available used, and got good reviews.
5. One other interesting note: the co-manager of the fund is ROB VOGEL
Rob Vogel joined Whitebox Advisors, LLC in 1999 as a convertible bond trader. From 1995 – 1999, Rob was a convertible bond trader for EBF & Associates of Minneapolis. From 1991 – 1995, Rob was an actuary and ran statistical models to estimate insurance reserves. Rob holds an MBA from the University of Minnesota and a BS in Applied Mathematics and Statistics from the University of Florida.
If you look under the Whitebox Selected Research, there is an article from Hedge Fund Review, awarding "Whitebox Concentrated Convertible Arbitrage" the "Best Non-Directional Hedge Fund Over 10 Years"
So, beyond what's available on Redleaf, this gives you some idea about the background of another manager on the fund:
http://www.whiteboxselectedresearch.com/wp-content/uploads/2012/08/HFR-Article-on-Convertible.pdf
Under that article about the convertible arb hedge fund: "The fund’s investments are
guided by Whitebox’s distinctive
market philosophy. One of the core
themes is to “be more invested at the
bottom than the top”. This reflects
Whitebox’s view that contrary to
conventional investment theories,
markets actually tend to be more
risky when they are less volatile."
“When markets are less volatile,
prices are generally higher, which
probably makes them riskier,” Vogel
explains. “We aim to be less exposed
when markets are tranquil so that,
if the cycle turns and prices get
cheaper, we can add to positions.”
As for the last manager, I think this is awfully interesting: " Prior to joining Whitebox Advisors, LLC in 2002, Jason spent two years working with Nobel Laureate Myron Scholes at Oak Hill Platinum Partners where he developed models for long/short equity strategies. "
http://en.wikipedia.org/wiki/Myron_Scholes
____
Lastly, I don't really want to tell David what to do, but I do agree this is really a fund that would be perfect for a profile. It only has 9.5M under management, but a pretty highly regarded management team.

Excellent move on behalf of T. Rowe Price. A number of their funds including New Horizon and Capital Appreciation continue their consistent and solid performance as the reins were handed over to their successors.

Morn'in hank,
You noted: " But, if you think inflation will run significantly more than 1.73% (compounded annually) than bonds today do not reflect reality very well. Catch has made much of the "capital appreciation" potential of rate sensitive bonds. That's true as long as investors continue to buy - eerily similar to the speculation that drove NASDAQ to 5000 a decade ago or real estate through the roof more recently. Now, much $$ was made from the "capital appreciation" in these sectors even after prices soared into the stratosphere. Nothing wrong with that as long as you're not the last one standing when the music stops."
>>>>> I agree. Don't be the last one standing when the music stops; regardless of the investment type.
Regards,
Catch