Alternative Share Classes and Funds

Not all readers are able or willing to invest in my recommended funds or share classes. Some funds are closed to new investors. Some funds or share classes aren’t available through the broker or other medium a reader prefers to use. Other readers don’t qualify for the recommended share class because of minimum investment requirements or other restrictions.

For those readers I present this review of the different share classes and alternative funds available.

MainStay Marketfield

Marketfield fund was acquired by New York Life and made part of its MainStay Group of Funds. Shareholders in the original Marketfield fund continue with the original share class with its expense ratio and pay no load. Most investors can’t meet the $5 million minimum investment for that share class. For them there are other share classes to choose from. I recommend the C shares with the ticker MFCDX.

PIMCO Funds

At the PIMCO funds, the best share classes are the institutional and P shares, but they require $1 million minimum investments. For most investors, the best share class is D, with $1,000 minimum purchase and no load. Another good option is the load-waived A shares, if they’re available through your broker or financial advisor. Avoid the regular A share class with their front-end load. I give the tickers for the D shares in the newsletter.

DoubleLine Funds

The DoubleLine funds have two share classes, both with no loads. The institutional share classes have lower expenses but higher minimum investments. For taxable accounts the minimums are $100,000, and for IRAs it’s only $5,000. The retail shares have a $2,000 minimum and only $500 for IRAs. I list the institutional shares in the newsletter. For DBLTX, the retail share ticker is DLTNX. For DBLEX, the retail shares are DLENX. .

High-Yield Bonds

My preferred high-yield bond fund for most portfolios is either T. Rowe Price High Yield Bond or Vanguard HIgh-Yield Corporate Bond. As of early 2013, the Vanguard fund is re-opened to new investors but the Price fund is closed. Good alternatives are Harbor High Yield and Metropolitan West High Yield. The Harbor fund does impose a 1% redemption fee on shares held less than nine months. When you want to stay with Fidelity, Fidelity High Income is a good choice.

MainStay Marketfield, PIMCO All Asset All Authority, T. Rowe Price Capital Appreciation, and FPA Crescent

These funds all are in the True Diversification portfolio. Along with Berwyn Income and William Blair Macro Allocation, they are tactical asset allocation funds. They adjust their holdings of different asset classes based on methodology used by the fund managers. Each has its own approach to allocation. At times FPA Crescent and Price Capital Appreciation are closed to new investors. The others sometimes have unsatisfactory recent performance for some investors or the investors are not able to purchase them through their preferred financial services provider. For these investors, I recommend taking the portion that would have been allocated to the funds you don’t like or aren’t able to buy and splitting that allocation between the other tactical asset allocation funds in the portfolio.