Comments on Fund My Mutual Fund: Bookkeeping: Adding SPDR Lehman 1-3 Month T-Bill E...

I understand the concept from an institutional all...

2008-11-06T10:44:00.000-05:00

I understand the concept from an institutional allocation point of view but institutions are not investing in mutual funds on a general basis.

I also think the past 3 months have shown not one asset class outside of US Treasuries has worked - granted thats a very unique period for that to happen. But put another way no manager has found a way to "fully invest" the money and preserve it with what has been happening the past quarter.

The reason institutional investors want individual...

2008-11-06T09:30:00.000-05:00

The reason institutional investors want individual money managers to be fully invested is because the investor wants to make the cash decisions at a portfolio level. If the investor wants a 10% cash position, he takes money away from his money managers.

Letting individual money managers make their own decisions as to when to not be fully invested and go to cash can result in a portfolio having a higher cash level than the investor wants.

Or, to put it another way, if you are a money manager and don't have any ideas on who to invest the money I gave you, and want to go to cash, I can take that money and find another manager who does have an idea how to fully invest that money.

Take a look at PVI, if the volume is not too low f...

2008-11-06T09:12:00.000-05:00

Take a look at PVI, if the volume is not too low for you. My 'cash' funds are SHY and PVI. PVI is muni, but pays a good dividend. This past month it paid double the normal dividend. BSV is only about 2/3 treasury. That is part of the volatility. It was trading at a big discount to NAV a few weeks ago.