PERM Article by Nusbaum of Street.com

[hrux]

Interesting summary.  In my opinion I would prefer this over PRPFX due to lower fees and truer adoption to HB PP

http://www.thestreet.com/story/11412646 ... mance.html

[Ad Orientem]

Thanks for posting.  I am definitely keeping an eye on PERM.  If it shows some stability and decent tax efficiency over a year or two I may recommend it over PRPFX as my favorite second choice for those who want maximum simplicity and one stop shopping.

[Reub]

Can it's stability and tax efficiency be predicted?

[Ad Orientem]

Can it's stability and tax efficiency be predicted?

I think stability (as in its been around a while and hasn't changed its asset allocation) is something that can only be shown with time.  Setting aside any of its shortcoming, PRPFX has an established record that gives me a reasonable level of confidence that it isn't going to do something weird or quirky tomorrow.  Tax efficiency is influenced by a lot of different factors, like rebalancing frequency and distributions.  That too requires a little bit of time to get a feel for how management is going to run things.

Bottom line... I am intrigued and think PERM has some real potential if it's run right.  It COULD end up being a better choice than PRPFX for one stop shoppers and those who just don't want to deal with their own finances.  One thing that would make it more attractive would be a modest reduction in F&E.  .48% is not unacceptable, but it is on the high end of what I would consider paying for a passively managed fund.

[longeyes]

PRPFX has walked the walk for a long time and has a lot of assets.  There is no surety that PERM, regardless of its merits, will attract enough investors to even be around two years from now.  ETFs come and go.  Make haste slowly.

[Reub]

If PERM eventually "goes", what would happen to money invested in it?

[MediumTex]

If PERM eventually "goes", what would happen to money invested in it?

I assume if they shut down the fund they would liquidate all of its holdings and return the money to shareholders.  Since it's mostly just a fund of funds, there might be an option to receive an in-kind distribution of the underlying fund shares.

[Ad Orientem]

If PERM eventually "goes", what would happen to money invested in it?

Law and securities regulations require that reasonable notice be given before any substantive changes are made to asset allocation or other integral aspects of an investment vehicle as advertised in its prospectus.  If a fund is dissolved then normally investors would be notified of the impending dissolution and asked what they would like done with their shares.  If no instructions are received shares would be converted to cash, MMF etc.