Best Mutual Funds: Tilson Dividend Fund (TILDX)

Insider Monkey has shown that Whitney Tilson’s alpha is about 5 percentage points per year. Tilson’s Focus Fund (TILFX) has a tiny alpha of around 80 basis points per year. Whitney Tilson has a second mutual fund which invests in value stocks that have high dividend yields. TILDX is a non-diversified mutual fund with more than 150% annual turnover and has an expense ratio of almost 2% per year.

In contrast to the Tilson Focus Fund (TILFX), Tilson Dividend Fund (TILDX) isn’t managed by Whitney Tilson. The mutual fund carries Whitney Tilson’s name but its portfolio manager is Malcolm (Zeke) Ashton. Insider Monkey, your source for free insider trading data, downloaded TILDX’s returns from Yahoo! and calculated the fund’s alpha by using Carhart’s four factor model. Surprisingly TILDX has a monthly alpha of 52 basis points. This is more than 6 percentage points after expenses. This is so far the best mutual fund Insider Monkey has analyzed. Its alpha is even better than the 5 percentage points alpha of Whitney Tilson’s hedge fund,  T2 Partners.

T2 PARTNERS

TILDX has a market beta of 0.69. It invests in mid size companies so it doesn’t have a small cap tilt. Even though Whitney Tilson is a value investor, Tilson Dividend Fund doesn’t have a value tilt. The “value effect” beta is -0.0003. You can’t practically get closer to zero than this. The fund doesn’t chase momentum stocks either. Considering Whitney Tilson has a significant value tilt in his other funds and TILDX doesn’t, we attribute the success of TILDX to Zeke Ashton.

There are thousands of mutual funds with zero or negative alpha, yet which managed to attract trillions of dollars. TILDX has more than 6 percentage points in alpha, comparable to prominent hedge funds like T2 Partners and Dan Loeb’s Third Point, but it manages only $40 Million. This alone shows Insider Monkey that investors don’t know what they are doing, and marketing and sales is the key factor for the financial success of fund managers. Instead of trying to create value (i.e. generate alpha), mutual funds secretly (or openly) mimick indices and produce revenue through management fees.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

10 Things The World Can’t Stand About Americans

Picture Perfect: The 6 Smartphones with the Best Cameras

The 10 Best Countries To Work In the World

A Profitable Day At The Track: 5 Tips For Betting On Horses

Tearing You Apart: 6 Bad Habits That Ruin Relationships

Learning on the Job: The 6 Biggest Mistakes Parents Make

Shopaholics Rejoice: The 12 Biggest Malls in the World

Fright Night: 10 Horror Movies Based on True Stories

Mach Mania: The 10 Fastest Jets in the World

Military Heavyweights: The 10 Countries with the Most Tanks

All In: The 7 Richest Poker Players in the World

Abracadabra: The 10 Best Magicians in the World

The 10 Richest Asian Countries in the World in 2014

Eyes in the Sky: 10 Things You Need to Know About Drones

Rising Stars: The 6 Best Silicon Valley Startups

Military Muscle: The 5 Most Advanced Armies in South America

All that Glitters: The 7 Most Luxurious Jewelry Brands in the World

5 Things You Didn’t Know About ISIS but Should

Empowering Your Money: The 5 Best Energy Stocks to Invest In

The 11 Best Android Apps You Can’t Get on iOS

The 10 Most Important International Conflicts in 2014

Mood Enhancers: The 20 Most Uplifting Songs of all Time

Lover Beware: The 8 Countries that Cheat the Most

Breath of Fresh Air: The 25 Countries with the Best Air Quality on the Planet

Singles Beware: The 8 Worst Mistakes Made on First Dates

Healthy and Happy: The 10 Countries with Lowest Healthcare Costs

The 6 Best Company Team Building Activities to Build Workplace Camaraderie

Ships Ahoy: The 10 Busiest Shipping Ports in the World

10 Productivity Tips to Save You Time and Help You Do More With Less

Grab a Bite: The Most Popular Fast Food Restaurants in America

Friday Night Thirst: The 10 Most Popular Cocktails in the World

The 6 Greatest Unsolved Mysteries We May Never Figure Out

7 Useless Products You Never Should’ve Bought

The 5 Reasons Why You’re Single and Miserable

The 7 Most Addictive Foods in the World We Can’t Stop Eating (Even Though We Should)

5 Amazing Places You Can Swim with Dolphins

The Top 7 Most Livable Countries In The World

The 10 Most Expensive Baseball Cards Ever Pulled From A Pack

The 5 Easiest Second Languages to Learn for English Speakers

Silver Spoon: The 6 Richest Families in the World

The 20 Countries with the Largest Prison Populations in the World

The Top 10 Richest Actors in the World

The 10 Best Airline Stocks to Invest In Before They Fly Too High

Burger Kings: The 10 Most Expensive Burgers in the World

The 10 Most Ethnically Diverse Countries in the World

The 10 Most Exclusive Credit Cards in the World

The 10 Most Expensive Cruise Ships in the World

The 10 Fastest Supercomputers in the World

The 10 Best Countries for Doing Business 2015

6 Most Expensive Fruits In The World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!