Mutual Global Discovery Fund

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Dec 8, 2009 9:40 am

I read today that PIMCO hired away their lead managers Anne Gudefin and Charles Lahr.  This is huge for PIMCO and really bad for FT/Mutual Series funds.  I use this fund a lot.  I will wait anxiously to hear what the response from FT is.  I also look forward to seeing what they will do over at PIMCO.  Interesting since PIMCO already uses RCM/NACM/NFJ as subadvisors for their Allianz portfolios.  PIMCO mostly runs index-type equity funds I think (other than the subadvised funds above).

Dec 8, 2009 9:55 am

They have already responded...

 
Mutual Global Discovery Fund
Portfolio managers: Peter Langerman, Philippe Brugere-Trelat
 
It is posted on the FT website.
 
We use TEDIX but will probably stop depending on how Philippe has performed. We are still looking into his history and speaking with our rep.
Dec 8, 2009 10:25 am

Langerman has been around a while in the Mutual Series fold.  It will still be interesting to see if they can maintain the same deep value approach.  I just hope it doesn't turn into Mutual Shares.  Not that it's a bad fund, but I like the defensive, global posture of MD.  I like it is a core equity holding for conservative investors.

My firm placed a review watch on them today.  If they remove them, it's probably not a good sign.
Dec 8, 2009 11:52 am

Dump it.. don't take the risk.. buy SGENX or MDLOX instead...(though there is a risk with SGENX)

Dec 8, 2009 11:55 am
Squash1:

Dump it.. don't take the risk.. buy SGENX or MDLOX instead...(though there is a risk with SGENX)

 
Actually, I use both of those funds already.  I am not yet concerned about SGENX.  I watch closely to see what they do, and I have read interviews with the managers.  I am comfortable for right now.  TEDIX is a little bit different than these.  It is both deep value and defensive.  But overall, I think SGENX is better managed than TEDIX.
Dec 8, 2009 11:59 am

Yeah but if mutual shares guy takes over, then it won't be what it was...

Dec 8, 2009 12:18 pm

What am I missing here? TEDIX is international equity and MDLOX/SGENX (although great funds) are allocation funds. Like maybe 60/40 or 80/20?

Dec 8, 2009 12:42 pm

A lot... TEDIX currently is 63% equities(US 15%), 35% cash, 3% bonds(yeah over 100% but it is from their website) expense 1.30

 
SGENX is 76% equities(US 25%), 11.2% gold, 5.1% bonds, 7.7% cash...expense 1.14
Dec 8, 2009 1:08 pm
Squash1:

A lot... TEDIX currently is 63% equities(US 15%), 35% cash, 3% bonds(yeah over 100% but it is from their website) expense 1.30

 
SGENX is 76% equities(US 25%), 11.2% gold, 5.1% bonds, 7.7% cash...expense 1.14

That's because they are short 3% equities.

 
But by your description above, how can SGENX replace TEDIX without disrupting the rest of a portfolio.
 
Maybe MAEGX, OAKWX or NWGAX would be more suitable...
Dec 8, 2009 1:32 pm

OK, OK, OK.  The issue is that all three (essentially) are global allocation funds.  They flex between international and U.S., and also flex their cash and gold positions.

 
If you are someone that strictly manages to style boxes (I am not), these are not the funds to use.  I  typically employ more of a core/satellite approach, with these funds typically being strong large-cap global core holding.  They are not exactly interchangeable, but they tend to have the same focus on results....absolute returns through all market cycles.  They don't use aggressive hedging techniques (well, a little bit) like a true absolute return strategy, but they will typcially underperform during bulls and outperform during bears.
 
Dec 8, 2009 1:39 pm

B24-

In larger accounts with multiple funds, how do you prevent overlap? Do you have time to micro-manage these funds to see which way they drift and if it's the same way? Or is this just your way versus mine?
 
I honestly prefer index funds for "core" holdings then chase yield in the "satellite".
Dec 8, 2009 1:45 pm
DeBolt:
Squash1:

A lot... TEDIX currently is 63% equities(US 15%), 35% cash, 3% bonds(yeah over 100% but it is from their website) expense 1.30

 
SGENX is 76% equities(US 25%), 11.2% gold, 5.1% bonds, 7.7% cash...expense 1.14

That's because they are short 3% equities.

 
But by your description above, how can SGENX replace TEDIX without disrupting the rest of a portfolio.
 
Maybe MAEGX, OAKWX or NWGAX would be more suitable...
 
What??
Where is the disruption? other than better performance(note: i rarely use funds anymore, but STOP FOLLOWING MORNINGSTAR BOXES!!! )
Dec 8, 2009 1:47 pm
DeBolt:

B24-

In larger accounts with multiple funds, how do you prevent overlap? Do you have time to micro-manage these funds to see which way they drift and if it's the same way? Or is this just your way versus mine?
 
I honestly prefer index funds for "core" holdings then chase yield in the "satellite".
 
Why are you asking how to prevent overlap? In your scenario, the index would overlap the satellites..
Dec 8, 2009 1:49 pm
Squash1:
DeBolt:

B24-

In larger accounts with multiple funds, how do you prevent overlap? Do you have time to micro-manage these funds to see which way they drift and if it's the same way? Or is this just your way versus mine?
 
I honestly prefer index funds for "core" holdings then chase yield in the "satellite".
 
Why are you asking how to prevent overlap? In your scenario, the index would overlap the satellites..

My overlap would be intentional. Instead of funds do you use ETF's or individual stocks? We are moving to more ETF based models.

Dec 8, 2009 1:51 pm

ETFs

Dec 8, 2009 1:53 pm

So we could pick this back up with active vs passive but I don't have it in me to go on. To each his own.


Dec 8, 2009 1:54 pm
DeBolt:

B24-

In larger accounts with multiple funds, how do you prevent overlap? Do you have time to micro-manage these funds to see which way they drift and if it's the same way? Or is this just your way versus mine?
 
I honestly prefer index funds for "core" holdings then chase yield in the "satellite".
 
With these funds it is not a problem.  Could it become a problem?  I guess so.  But it's not like a I am layering in other large cap global value funds.  To these I am adding small caps, emerging markets, fixed income of various sorts, etc.  It's really not a problem. 
And if I use these funds regularly, I don't see monitoring them as "micro-managing".  How often do you have to check for overlap?  Once a month? Maybe?  That takes 5 minutes.
Dec 8, 2009 2:28 pm

So I just got the call from my FT wholesaler on the manager change.  He let me know that we shouldn't worry, they won't miss a beat.  Wheeeeeeewwwhhh!  Thank goodness I got that update.  I was thinking he was going to give me some real bad news.

Dec 8, 2009 2:37 pm
B24:

So I just got the call from my FT wholesaler on the manager change.  He let me know that we shouldn't worry, they won't miss a beat.  Wheeeeeeewwwhhh!  Thank goodness I got that update.  I was thinking he was going to give me some real bad news.

 
did he explain why Founding Funds didn't work?
Dec 8, 2009 3:07 pm
Squash1:
B24:

So I just got the call from my FT wholesaler on the manager change.  He let me know that we shouldn't worry, they won't miss a beat.  Wheeeeeeewwwhhh!  Thank goodness I got that update.  I was thinking he was going to give me some real bad news.

 
did he explain why Founding Funds didn't work?
 

I don't know.  I don't use that fund(s).