WKRP

"We want more rock and Les Nessman." Or was that less Nessman. That line from WKRP might be better than Herb's muy dinero line and this is where the investing world may be with Dennis Kneale's constant appearances on The Network.

I met Dennis in late 2004, we did a segment on the Forbes on Fox show together. He is a very nice guy and although some of you will doubt me on this he does know more than a thing or two about how to look at a stock.

Unfortunately for anyone who watches the network they have him commenting regularly, almost exclusively on things that are outside his wheelhouse and his image and credibility are each taking a beating. To use a shaky analogy; a tow truck brings nothing to the table for fighting a wildfire.

On to the questions...

A reader asked about the Accessor Strategic Alternatives Fund (ASAFX) and left a link to the prospectus. It looks like 80% of the fund will go into assets that usually have a low correlation to global stock and bond markets. Sounds good to me but I do not know if the fund is trading, or what they own or much else. Not to be flip but it will either be a viable absolute-ish type fund or not. I will add it to my watch list. I am all for learning about anything but there is never a rush to buy.

There were a couple of comments favorably disposed to the the Claymore fund from yesterday's post that owns it all; UEM. One reader made a point that I can certainly buy into (even if not ideal for what I try to do) which is that used as a starting point an investor could fill in the gaps around UEM and have more time to learn how better to fill in those gaps.

One point I did not quite agree with was that using UEM is a good low cost alternative "for people with small resources to buy a broad, indexed portfolio" and that "it would take at least three or four purchase, each with minimums of several thousand dollars, to get the same effect through Vanguard funds" and finally that it means buying fewer ETFs.

Depending on how limited the resources, Sharebuilder only charges $4 per trade the last time I looked. Starting small does not have to be the barrier to entry it once was and further the implication is younger investors for whom 51% in equities is probably not enough.

Jasper would like to see a global ETF that took in all the stock segments into one fund. He had specific criteria that might be tough to ever find but NortherTrust has filed for the NETS DJ Global Total Market Index Fund. If it ever comes it will have it all but maybe not in the proportion you would like.

One thing though is that no matter what it looks like it will have skews and biases that will at times make a bad hold. My own take is that going so broad (applies to EFA) ends up blending away all the attributes sought.

A couple of different questions came in about the failed auctions and what they mean for different parts of the closed end fund market. I try to minimize the use to sophisticated industry jargon but I don't know how to articulate this without the jargon; the bond market is all messed up.

I do not have all the answers, not even close. The part of this that I know is what I have been writing about for a couple of years. When the yield curve takes on an abnormal slope there will be fallout--that I know. What I don't know is how to assess where and when various fixed income segments will be impacted.

The current abnormalization (how about that one?) seems longer than usual and this failed auction business is a new shoe to drop, it makes sense to expect more shoes. I have never been a fan of widespread CEF use. There are some segments where CEFs are, for now, the best tool but the muni funds and the preferred stock funds have a habit of not hanging in there when you need them most. Some CEFs use auctions to access liquidity (this is how they leverage) so if some auctions, related or not, fail then CEFs could be guilty by association or because they really are directly impacted.