Smart401k Blog

This week I thought I would take the time to discuss another one of my favorite funds, Ivy Asset Strategy A.  In the interest of disclosure, this fund is another of my personal holdings.  Ivy Asset Strategy is a world allocation fund.  For those of you that may not know, a world allocation fund is a fund that will invest in stocks and bonds of domestic and foreign companies.

Ivy Asset Strategy A seeks long-term capital appreciation by investing primarily in stocks and securities that can be converted into common stock.  The fund may also invest in cash, bonds, precious metals (for defensive purposes) and currency markets from time to time.

The fund is managed by Michael Avery who has 31 years of investment experience including 12 with the Ivy Asset Strategy A.  Avery selects investments for the fund by combining a bottom-up fundament analysis of companies with top-down economic research.  He looks for high-quality companies that he believes can demonstrate consistent, profitable growth and strong returns while generating substantial cash flow from their respective operations.

Avery is currently very cautious about the U.S. market as evident by his recent quarterly commentary.  ”As fiscal and monetary policy debates have continued in Washington over the past year, it has created a lot of shifts in equity and bond market sentiment. In our view, in spite of the aggressive multi-trillion dollar stimulus that has been thrown at the recession, we feel the U.S. consumer is not going to bite.  We feel savings rates will continue to rise while consumption and leverage will go down.” He does however feel very optimistic about China and India.  ”Given balance sheet recession conditions in the U.S., as well as severe economic weakness in Europe, we have made China our number one country weighting. India has become our second largest country weighting.  In fact, our exposure to India is substantially higher than that of developed Europe. We have increased our exposure to India since that country’s May election, as we believe gradual market reforms and spending on productive infrastructure will pave the way for continued above-average GDP growth and higher levels of consumer wealth and spending.”*  

Ivy Asset Strategy A has a great long-term track record.  The fund has a three-year and five-year annualized track record of 7.15% and 14.81% respectively.  Its three-year performance puts the fund in the top 4% of funds in its category as the fund outperformed its peer group by an average of 12.83% annually.  Its five-year performance puts the fund in the top 3% of funds in its category as the fund outperformed its peer group by an average of 12.46% annually.

This article is not a recommendation for the Ivy Asset Strategy A fund, but rather a quick look at one of my personal favorites.  Please contact us with any questions regarding the Ivy Asset Strategy A or any other fund that you may be considering.  Please be sure that any fund that you purchase meets your individual needs or circumstances.

Buck Wendel, Investment Advisor

*Please note: While we generally believe in allowing fund managers to pursue investment opportunities that they feel have the potential for above average growth, we do not recommend investing in specific country or sector funds for most investors.  If you are considering a specific country or sector fund, please feel free to contact me directly at 913.744.3376 to discuss your investment strategy.

This entry was posted on Wednesday, August 12th, 2009 at 5:23 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.