If you look at their portraits
you wouldn't normally associate this team of wild-eyed free-wheelin' happy-go-lucky extroverts with the word "rampage", but TBGVX is up 9.5% since January. It shot up almost 0.5%-- 12 cents-- yesterday (Thursday 28 July). It's nearly doubled since its March 2003 low of $13.49. The returns are especially impressive when you consider that TBGVX hedges against the dollar to remain currency-neutral and has a 1.39% ER. Their gains have been completely without any boost from the dollar's drop. Of course if the dollar strengthens then they won't be punished by it either.
In just six months TBGVX has given us an entire year's worth of spending money. Our taxable & IRA holdings make it 35% of our portfolio (up from about 33% in Jan). Our cost basis in the taxable account is $16 and most of the shares have been held for more than five years.
This performance is coming from a fund whose 31 March 2005 annual report
is over 20% cash, complaining about reaching full valuation, gloomily grumping about the lack of opportunities, and closing for the first time in 12 years (at >$6B). After TBGVX's 21% cash position most of the fund's money is invested in the Netherlands (15%) and Switzerland (12.5%). Japan is #5 on the list after U.K. & America. They just started buying in South Korea (0.8%, most of it in the KEPCO electric utility) and there's no China holdings. The fund is 14% in food & beverages, another 14% in printing & publishing, 8% in both banking & pharma, and 5% in machinery.
For you expats, their most valuable stock holdings appear to be KBC Groupe SA (Belgium), Kone Oyj (Finland), CNP Assurances (France), Springer (Axel) Verlag AG (Germany), Jardine Strategic Holdings (Hong Kong), Sanyo Shinpan Finance (Japan), ABN AMRO Holding NV & Heineken (Neitherlands), Nestle & Novartis (Switzerland), Altadis SA (Spain), and Trinity Mirror (UK). I didn't run all the tickers, but I know that Jardine was already up 70% before 31 March and has "only" risen another 30% (2% of the fund) while Nestle & Novartis haven't done anything this year. Trinity is up 55% but is only another 2% of the fund.
The last two paragraphs describe what should be one of the world's most boring multi-cap value funds. Does anyone have any idea what's driving this price rise?
Next week we're pulling a year's spending money out of TBGVX, some of which will pay the taxes on a partial Roth IRA conversion (still Tweedy). That will "reduce" TBGVX back to about 33% of our retirement portfolio. We'll be holding the rest of the cash for either iShares' new micro-cap fund or possibly the international ETF EFA. (No, we won't be paying down any mortgages!) My concern is that both funds could be pounded if the dollar surprises everyone by gaining more strength, but we don't have to rush into them.
This sale puts our retirement portfolio at almost 6% cash (plus whatever cash Tweedy's holding). We haven't been this much in cash since summer 2004. Does this make us dirty market momentum timers?