A financial question for you...

As a shareholder in a fund, I received a ballot to vote on a change in the fund. It's the Ivy Large Cap Growth fund, and the change is to go from a diversified to a non-diversified fund. The trustees are recommending voting yes for the change, of course.

I understand what that means as far as how the fund is invested and the possible risks associated with the increased exposure the non-diversified investments bring. I'd just like to hear your take on this, if you don't mind.

On Sun, 9 Aug 2020 08:43:47 -0700 (PDT), Its Me
wrote:

A financial question for you...

As a shareholder in a fund, I received a ballot to vote on a change in the fund. It's the Ivy Large Cap Growth fund, and the change is to go from a diversified to a non-diversified fund. The trustees are recommending voting yes for the change, of course.

I understand what that means as far as how the fund is invested and the possible risks associated with the increased exposure the non-diversified investments bring. I'd just like to hear your take on this, if you don't mind.

===

Let me start out by saying that I don't think I have any special
expertise with fund selection or analysis. As you probably know their
performance over the 10 years has been quite respectable and the
Morningstar ratings reflect that. The one negative that I see is the
1.01% expense ratio which is a bit on the high side but perhaps
justified by the good returns.

The proposed change in investment style begs the question of "why".
Looking at current holdings, the portfolio seems heavily weighted
towards the tech sector which strikes me as not being very diversified
although it has certainly been successful. Perhaps they recognize
that imbalance and want to change their stated objectives to reflect
actual holdings.

At any rate it's hard to argue with success but it's never a good idea
to have all your eggs in one basket. I'd suggest taking a look at all
of your holdings and see if you're comfortable with your personal
diversification and risk level. A good financial advisor could help
with that.

I keep trying to de-risk my own portfolio but I've had the good
fortune to own some very successful tech stocks like Nvidia and
Amazon. I sold off some Nvidia on the way up but it continues to
climb and now has an outsized overall weight in my holdings - not a
bad problem to have but it makes me a bit uncomfortable. My goal
these days is to try and find investments that are both recession
proof and hedged against inflation since I see both of those things
coming in the near future.

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On Sunday, August 9, 2020 at 1:42:00 PM UTC-4, wrote:
On Sun, 9 Aug 2020 08:43:47 -0700 (PDT), Its Me
wrote:

A financial question for you...

As a shareholder in a fund, I received a ballot to vote on a change in the fund. It's the Ivy Large Cap Growth fund, and the change is to go from a diversified to a non-diversified fund. The trustees are recommending voting yes for the change, of course.

I understand what that means as far as how the fund is invested and the possible risks associated with the increased exposure the non-diversified investments bring. I'd just like to hear your take on this, if you don't mind.

===

Let me start out by saying that I don't think I have any special
expertise with fund selection or analysis. As you probably know their
performance over the 10 years has been quite respectable and the
Morningstar ratings reflect that. The one negative that I see is the
1.01% expense ratio which is a bit on the high side but perhaps
justified by the good returns.

The proposed change in investment style begs the question of "why".
Looking at current holdings, the portfolio seems heavily weighted
towards the tech sector which strikes me as not being very diversified
although it has certainly been successful. Perhaps they recognize
that imbalance and want to change their stated objectives to reflect
actual holdings.

At any rate it's hard to argue with success but it's never a good idea
to have all your eggs in one basket. I'd suggest taking a look at all
of your holdings and see if you're comfortable with your personal
diversification and risk level. A good financial advisor could help
with that.

I keep trying to de-risk my own portfolio but I've had the good
fortune to own some very successful tech stocks like Nvidia and
Amazon. I sold off some Nvidia on the way up but it continues to
climb and now has an outsized overall weight in my holdings - not a
bad problem to have but it makes me a bit uncomfortable. My goal
these days is to try and find investments that are both recession
proof and hedged against inflation since I see both of those things
coming in the near future.

I understand your disclaimer but compared to me you must have stayed in a Holiday Inn Express last night! Seriously, thanks for your well reasoned response. I agree that their expense ratio is a little high, but the good news is that I executed a Letter of Intent with W&R a while back and fulfilled it, so I have no transaction charges. It has had some nice returns in the last few years overall. My FA works for W&R and is a friend, he's just not as proactive as I'd like sometimes. I'm moving toward the less risky side of things, as I'll be retired in the near future.

Again thanks, smooth sailing (err, cruising)!