Briefly Noted | Mutual Fund Observer

By TheShadow

Not a major surprise, but there are a load of active ETFs in the pipeline.  Fidelity has launched Fidelity Tactical Bond ETF. John Hancock will have John Hancock International High Dividend, and Hartford is launched Hartford Sustainable Income, managed by a team from Wellington. iShares is launched an active U.S. Consumer Focused ETF, but such funds have always felt a bit gimmicky to us. Finally, Neuberger Berman Commodity Strategy Fund is becoming an ETF on or about October 21, 2022.

Akre ups international flexibility. Effective November 28, 2022, the percentage of the Akre Focus Fund portfolio that can be devoted to international equities pops up from 15% to 25%.

ClearBridge Focus Value ESG ETF is transitioning from non-transparent to transparent though the advisor offered no reason for the change. I’d guess it has to do with minimizing administrative hassle, but that’s only a guess.

Sextant gives up its fulcrum.  In September 2022, the board of the Sextant funds approved a plan to scrap the funds’ longstanding fulcrum fee. The advisor charges 0.50% for their services, and that will continue. The old system rewarded the advisor with a higher fee if they outperformed their peers and penalized them with a lower fee if they underperformed.

The Soundwatch Hedged Equity Fund, which is primarily involved with options trading, will be converted into an ETF on or about October 21. Morningstar rates this fund overall with four stars.

Small Wins for Investors

Alger Small Cap Focus Fund was re-opened to all investors on or about October 17, 2022. The fund was soft-closed to new investors on July 31, 2019.

Effective October 28, 2022, the Altegris/AACA Opportunistic Real Estate Fund will discontinue its short-term redemption fee. Redemption fees make a world of sense –they “tax” people who trade into and out of the fund in rapid succession – but investors seem to loathe them.

iMGP Dolan McEniry Corporate Bond Fund will have a share class conversion of its investor class shares into its institutional share class on or about September 30, 2022. As a result of the conversion, the minimum initial investment amount for retirement accounts will be changed from $5,000 to $1,000.

Effective October 3, 2022, the Lord Abbett Developing Growth Fund will be reopened to new investors

Morgan Stanley Global Opportunity Portfolio is re-opening to new investors on January 23, 2023. The fund was closed to new investors effective December 31, 2020. Several consecutive months of outflows during 2022, coupled with buying opportunities available, have resulted in management re-opening the fund.

Polar Capital Emerging Market Stars Fund will convert its sole institutional class into the fund’s sole share class. The conversion will result in the fund’s initial minimum being lowered from $100,000 to $5,000. These changes were effective September 1,

Wasatch Global Investors has re-opened six of its mutual funds immediately through financial intermediaries: Wasatch Core Growth, Wasatch Small Cap Growth, Wasatch Ultra Growth, Wasatch Small Cap Value, Wasatch Micro Cap, and Wasatch International Opportunities. The funds have been closed over the past several years due to the influx of cash inflows and performance. For the first time in a long while, all 20 of the Wasatch funds are open to new investors.

Old Wine, New Bottles

Invesco Funds is reorganizing its American Value Fund into its Value Opportunities Fund. Invesco is also reorganizing its Global Growth Fund into its Global Fund. The reorganizations are expected to occur on or about February 10, 2023.

The former Highland Funds have become the NexPoint funds.

On October 21, 2022, Q3 All-Weather Sector Rotation Fund will change its name to Q3 All-Season Sector Rotation Fund, and the Q3 All-Weather Tactical Fund will change its name to Q3 All-Season Tactical Fund. Because, presumably, a lot of investors were backing away from the fund, crying, “All-Weather? Heck no, I’m lookin’ for an All-Season fund!”

VanEck Morningstar Durable Dividend ETF has been rechristened VanEck Durable High Dividend ETF.

Liquidations (and Related Inconveniences)

Emles Trust is liquidating several ETFs on or about October 26:

  • Emles @Home ETF
  • Emles Federal Contractors ETF
  • Emles Made in America ETF
  • Emles Alpha Opportunities ETF
  • Emles Luxury Goods ETF
  • Emles Real Estate Credit ETF

First Trust TCW ESG Premier Equity ETF disappears on November 1, 2022.

FRC Founders Index Fund will be liquidated and terminated on October 31, 2022. The fund had an interesting idea – invest in a basket of companies still run by their founders – and did everything right – low fees, broad diversification, and high insider ownership, only to discover that “interesting” and “successful” were very different things. The fund has drawn just $25 million, and the turmoil of the past year has hit its small cap-dominated portfolio hard.

No need to worry about what to get the Goldman Sachs Target Date Funds for Christmas. Goldman Sachs Target Date Retirement and Target Date 2025 through 2060 all get shut down on December 20, 2022.

Harbor Emerging Markets Equity and Harbor Money Market Funds will liquidate on or about December 9.

On or about February 10, 2023, Invesco American Values will merge into Value Opportunities, and Invesco Global Growth gets swallowed by Invesco Global. Somehow the class R shares of Invesco Global are not part of the deal, but I’m not sure what that translates to.

LHA Tactical Beta Variable Series Fund will liquidate on or about October 7.

The $344 million Lord Abbett Durable Growth Fund will redefine “Durable” to mean “disappeared” as of October 25, 2022.

Lord Abbett Mid Cap Innovation Growth Fund  will be liquidated and dissolved around October 28, 2022

Macquarie Labor Select International Equity Portfolio will liquidate and dissolve on or about December 16, 2022. The fund’s ticker is DELPX, but different sites report several variations on its name.

Nationwide American Century Small Cap Income Fund will be liquidated on or about January 23, 2023.

Stone Ridge Bitcoin Strategy Fund will liquidate on or about October 21.

USAA Global Equity Income Fund Institutional Shares will liquidate on or about November 29, 2022.

On September 22, 2022, the board of trustees for Vanguard U.S. Liquidity Factor ETF agreed to liquidate and dissolve the ETF on or about November 28, 2022.

WBI BullBear Global Income ETF and WBI BullBear Trend Switch US 3000 Total Return ETF will not be around to see the end of the current BullBear cycle since they will be liquidated on October 14, 2022.

Manager changes

Which fund? What changes, when?
American Century Focused Dynamic Growth ETF and Focused Dynamic Growth Fund   Prabha Ram, Vice President and Portfolio Manager has announced her plans to leave American Century Investments on September 30, 2022. Messrs. He, Li, and Le, all appointed in 2016 with Ms Ram, remain.
Axonic Strategic Income Jamshed Engineer is out; Clayton DeGiacinto and Matthew Weinstein remain.
BlackRock Future Tech ETF Caroline Tall has joined portfolio managers. Tony Kim and Reid Menge.
BlackRock Mid-Cap Growth Equity, BlackRock Capital Appreciation, BlackRock Large Cap Focus Growth, BlackRock Exchange BlackRock, BlackRock Sustainable US Growth Equity Effective April 1, 2023, Lawrence G. Kemp. Phil Ruvinsky and the recently added William Broadbent will remain. Kemp, who brought Mr. Ruvinsky with him from UBS, is wrapping up a 40-year career.
BNY Mellon International Bond Fund and  BNY Mellon Global Fixed Income Fund Nathaniel Hyde, CFA, was just added to the three-person team, presumably to succeed the just-departed David Leduc, Mellon’s CIO.
Boston Partners Small Cap Value Fund II On September 16, 2022, David Dabora retired from Boston Partners and management of this fund. His former co-manager, George Gumpert, is going commando!
Braddock Multi-Strategy Income Fund Braddock is replacing itself as manager of the fund, bringing in Bramshill Investments, LLC instead. That’s a good move for the shareholders, given the record of Bramshill’s four-star Income Performance fund.
C WorldWide International Equities Fund Effective September 1, 2022, Lars Wincentsen is out, and Peter O’Reilly is in. He’ll serve with Bo Almar Knudsen, Bengt Seger and Matthias Kolm .
Clearbridge Appreciation Fund Stephen Rigo, CFA, is joining Scott Glasser (who has managed the fund since 2001) and Michael Kagan. The fund’s defining characteristic is its consistently below-average volatility rather than its excellent returns.
Fidelity Strategic Advisers Large Cap Fund Fidelity has added DESIM, the marketer’s version of D.E. Shaw Investment Management, to the caste of thousands already assigned to the fund. Okay, 15 different sub-advisor firms.
Marsico Midcap Growth Focus Fund Peter Marsico and James Marsico have joined Tom Marsico as the fund’s management team. (Sings along to “It’s a family affair,” the Sly and the Family Stone one, not Mary J. Blige’s)
Meeder Funds Amisha Kaus had been removed from the management teams of six Meeder allocation and income funds. The funds cycled through a vast number of managers over the past decade without noticeable hiccups. That said, two of the three longest-tenured managers departed this year, leaving founder Robert Meeder as the source of management continuity.
Newday Ocean Health ETF and Newday Diversity, Equity & Inclusion ETF Gabriel Mass has replaced Gordon Telfer as a portfolio manager of each fund, whose playful ticker symbols are AHOY and FAIR
Old Westbury Large Cap Strategies Fund After about a year’s service, John Coviello is out. Messrs. John Hall, Edward N. Aw, Jeffrey A. Rutledge, and Ms. Nancy Sheft will continue to serve as portfolio managers
Old Westbury Small & Mid Cap Strategies Fund After about a year’s service, John Coviello is out. Messrs. Michael Morrisroe, Edward N. Aw, Konstantin Tcherepachenets, and Mses. Nancy Sheft and Andrea Tulcin will continue to serve. (I copied Old Westbury’s text here because I hadn’t encountered the plural “Mses.” before and was rather struck by it.
Schwab Select Large Cap Growth Fund Effective April 1, 2023, Lawrence G. Kemp will retire from BlackRock Investment, the fund’s subadviser. Phil Ruvinsky and the recently added Caroline Bottinelli will remain.
The 3D Printing ETF and ARK Israel Innovative Technology ETF William Scherer replaces founder Cathy Wood, perhaps to free up her time to manage her new VC-focused mutual fund.


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