As most of you know, I report the returns of my competitors when I report the returns of Malachite Aggressive Preferred Fund; one of these competitors is Jov Leon Frazer Preferred Equity Fund.
I had problems in April, however – the Morningstar reporting page wasn’t updated and, in fact, the last price they had was dated 2015-4-17.
Similarly, the Globe & Mail reporting page has the last price dated 2015-4-17, although due to a hole in the space-time continuum, they report “Returns as at April 30, 2015”. Mind you, though, the index returns they report to this end-date look nothing like anything else I’ve seen to April 30, so I’ll deem it unreliable.
When in doubt, go to the horse’s mouth! The Jov Financial Solutions reporting page provides numbers to April 30, but they seem a little … suspicious. Like, for instance, the one-year return for the Class A units is reported as -11.00%, but the one-year return for the Class F units is reported as +1.96%. Now, we’re all familiar with high MERs and how they can be avoided by use of Class F units, but a difference of almost 13% over a one year period seems a little … extreme. Even for the Canadian Market.
It’s not just their web-server gone momentarily berserk. Here’s the PDF, which reports the same enormous difference. I’m considering having it framed.
Oddly, this PDF reports the same one year TXPR return to 2015-4-30 as the Globe does: -7.70%. Well, according to me and according to Blackrock, the one year return for TXPR to April 30 was -3.19%. I’m not showing their -7.70% one-year return anywhere in my records. The closest I get is -7.73% for the year ended 2010-12-31.
So I send an email to info@jovfunds.com asking them what’s going on:
Can you explain the performance reporting of the captioned fund?
The Morningstar page at http://cart.morningstar.ca/QuickTakes/fund/Performance/f_Perf.aspx?t=F000005I49®ion=CAN&culture=en-CA appears to be no longer updated.
The Jov Financial Solutions page at http://jovian.transmissionmedia.ca/fundprofile_jov.aspx?f=JOV110 contains figures for returns which are so wildly different for different classes of fund units that I have great difficulty believing any of the numbers.
The Globe & Mail page at http://www.theglobeandmail.com/globe-investor/funds-and-etfs/funds/summary/?id=59829 reports figures which appear to have ceased being updated on April 17.
Where may I find performance reporting for the fund? If it is the Jov Financial Solutions page, please help me to understand how the reported figures for the different classes are so wildly different (e.g., 1-Year for Series A is reported as -11.00%, 1-Year for Series F is reported as +1.96%).
Sincerely,
Well, I got an answer surprisingly fast:
MailEnable: Message could not be delivered to some recipients.
The following recipient(s) could not be reached:
Recipient: [SMTP:info@jovfunds.com]
Reason: Remote SMTP Server Returned: 554 5.1.2 Recipient address rejected: User unknown
Huh! So, I go to SEDAR and look for documents from Jov Leon Frazer Preferred Equity Fund. The last filing was “Amended and restated final fund facts – English”, dated March 11, 2015. No luck there!
So let’s check the Leon Frazer website. Success! I found a mention that might go a long way towards explaining the mess!
The JOV Leon Frazer Dividend Fund, the JOV Leon Frazer Bond Fund and the JOV Leon Frazer Preferred Equity Fund are all available through JovFinancial Solutions Inc., an affiliate of Leon Frazer. Industrial Alliance has indicated that it intends to merge JovFinancial Solutions Inc. with IA Clarington Investments Inc. in early 2014.
So now let’s go to the IA Clarington Website and browse funds by Asset Class …. nothing! The word “preferred” is not found on this page.
So I’m confused. I’ve been in the business for nearly thirty years and I’m confused. God knows what Mom and Pop must think. If anybody can tell me a story about this fund, please let me know.
Update: Roger in the comments found the answer! The public parts of the fund were closed and folded into an IA Clarington Money-Market Fund. The private parts (!) continue as some kind of pooled fund for Leon Frazer clients.
JovFinancial Solutions Inc. (“JovFinancial”) and T.E. Investment Counsel Inc. (“TEIC” and together with JovFinancial, the “Managers”) are announcing a proposal to terminate certain series of Jov Leon Frazer Bond Fund, Jov Leon Frazer Dividend Fund and Jov Leon Frazer Preferred Equity Fund (the “Jov Leon Frazer Funds”) and Jov Prosperity Canadian Fixed Income Fund, Jov Prosperity Canadian Equity Fund, Jov Prosperity U.S. Equity Fund and Jov Prosperity International Equity Fund (the “Jov Prosperity Funds”) and, subject to regulatory approval, merge such terminating series with IA Clarington Money Market Fund. Managed accounts of Leon Frazer & Associates Inc. clients hold Series I units of the Jov Leon Frazer Funds, which will not be merged, and managed accounts of TEIC clients hold Series B and O units of the Jov Prosperity Funds, which will not be merged, and as a result such managed accounts will be unaffected by this merger.
Effective immediately, any Series A, F, O and T of the Jov Leon Frazer Funds are closed to new purchases. Series A, F and I of the Jov Prosperity Funds were closed to new purchases on January 6, 2012.
Subject to regulatory approval, the Managers propose that on or about January 23, 2015:
(a) Series A, F and O of the Jov Leon Frazer Funds will be merged with IA Clarington Money Market Fund, and securityholders thereof will receive units of Series A, F and O, respectively, of IA Clarington Money Market Fund on a dollar for dollar basis. Securityholders of Series T of Jov Leon Frazer Preferred Equity Fund will receive units of Series A of the IA Clarington Money Market Fund; and
(b) Series A, F and I of the Jov Prosperity Funds will be merged with IA Clarington Money Market Fund, and securityholders thereof will receive units of Series A, DF and I, respectively, of IA Clarington Money Market Fund on a dollar for dollar basis.
If regulatory approval for the mergers is not obtained, the affected series will be terminated.
It’s very surprising that this information is so obscure. Just a simple note and somewhat more explicit link on the fund’s web-page (which is linked from the JovFunds Products Page) would have saved a lot of aggravation. I will cheerfully admit that a draft of the press release quoted above is also linked on the products page … but not too obviously and Holy Smokes! If I find the fund name and click the word “Profile” right beside it, shouldn’t that be enough? And were they really so cheap that they had to shut down the “info@jovfunds.com” account, instead of putting in an auto-responder with a brief explanation?
Update, 2015-5-31: Actually, it appears that holders were cashed out:
JovFinancial Solutions Inc. and T.E. Investment Counsel Inc. Wednesday provided an update on their previously announced proposal to terminate certain series of several Jov Funds.
The affected funds are: Jov Leon Frazer Bond Fund; Jov Leon Frazer Dividend Fund; and Jov Leon Frazer Preferred Equity Fund (the Jov Leon Frazer Funds); and Jov Prosperity Canadian Fixed Income Fund; Jov Prosperity Canadian Equity Fund; Jov Prosperity U.S. Equity Fund; and Jov Prosperity International Equity Fund (the Jov Prosperity Funds).
Series A, F, O and T of the Jov Leon Frazer Funds were closed to new purchases on Oct. 23, 2014 and Series A, F and I of the Jov Prosperity Funds were closed to new purchases on Jan. 6, 2012.
On Oct. 23, 2014, the companies announced a proposal to merge the affected series with IA Clarington Money Market Fund on Jan. 23, 2015. However, the regulatory exemptions necessary to permit the issuance of units of the IA Clarington Money Market Fund have not been granted.
As a result, unitholders will receive cash proceeds on the termination of the affected series. In order to provide unitholders sufficient time to respond to this change, the companies have elected to defer the terminations until April 17.
IAG.PR.G : No Conversion to FloatingReset
Thursday, June 29th, 2017Industrial Alliance Insurance and Financial Services Inc. has disclosed in an eMail response to my nine (count ’em, nine) inquiries:
This is pretty second-rate shareholder communication, although I have no doubt that it is legal. CDS? The company is relying on CDS, a bank-owned monopoly with basically no mandate or incentive to communicate with shareholders and entrusting it with the responsibility to promulgate corporate information? The idea is ridiculous.
We can look, for instance, at the SEC’s 2013 announcement regarding disclosures via Twitter (emphasis added):
The fact that material disclosures of this nature can be made selectively to broker-members of CDS is a disgrace and is particularly obnoxious in that CDS’s immediate controller, the bank-owned Toronto Stock Exchange, has not publicized this information on their website listing for IAG.PR.G or, indeed, for IAG common. However, given that this selective disclosure favours the Big Banks, I’m not holding my breath while waiting for regulatory action.
Assiduous Readers will recall that IAG.PR.G will reset at 3.777% and should now be referred to as a FixedReset, 3.777%+285. I recommended against conversion.
IAG.PR.G commenced trading 2012-6-1 (and was, unusually, re-opened on 2012-6-19) after being announced 2012-5-24. It has been a member of the FixedReset subindex since inception.
As this issue is not NVCC compliant, it is analyzed as having a Deemed Retraction.
Update, 2017-6-30 : The eMail quoted above was from the company and received 2017-06-28. The following was received from the always efficient Computershare on 2017-06-30 (they got the same inquiries I sent to the company itself):
Note that the phrase “gave written notice to this effect to holders” is a very, very clever phrase that some people consider ethical: since IAG.PR.G is book-based, there is (in a very, very clever, lawyerly sense) exactly one holder – CDS. So hats off to the very, very clever people at Computershare!
Yours Sincerely,
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