Aquila Three Peaks Opportunity Growth Fund was included in a “Category Kings” report by The Wall Street Journal for the one-year period ending May 29, 2015. The Category Kings report recognizes the top 10 performing funds, based on total return, in 16 Lipper categories for the one-year period. Aquila Three Peaks Opportunity Growth Fund class Y (ATGYX) was listed at #1 in the Lipper Mid Cap Core equity category, out of 384 open-end mutual funds. During this period, the Fund generated a total return of 20.2% compared to the Lipper Mid Cap Core category average of 10.0% and the Russell 3000 Index return of 11.9%. Read more “Aquila Three Peaks Opportunity Growth Fund Recognized as a Category King”
Supply of Municipal Bonds
Supply and demand continue to drive valuations in the municipal bond market. Through May, 2015 the supply of municipal bonds picked up dramatically, although as much as 70% of municipal bond issuance represented the refunding of outstanding debt, allowing issuers to take advantage of low rates and reduce debt service costs. Even with more supply nationally, we saw the market readily absorb the new issuance. State and municipal new issuance has been limited in recent years, and as a result, the outstanding supply of municipal bonds has not grown significantly, while refinancings have improved the credit profile of many issuers.
Yield and Valuation
Municipal yields remain attractive on a relative valuation basis at 100% to 105% of Treasuries. As of June 1, 2015, the yield on the 10-year Treasury was 2.19% while the yield on the 10-year Barclays Municipal Bond Index was 2.25%. Read more “Our Views on the Municipal Bond Market”
During the month of May, the State of Arizona received ratings upgrades from both Moody’s Investors Service and Standard & Poor’s. On May 5th Moody’s upgraded Arizona from Aa3 to Aa2, and on May 20th Standard & Poor’s upgraded Arizona from AA-minus to AA. A credit analyst from Standard & Poor’s cited improvements in Arizona’s budget, including recent growth in tax revenues, as reasons for the upgrade. The economy in Arizona continues to improve and higher income tax collections may reduce or eliminate the need to draw on the rainy day fund during the 2015 fiscal year, which ends June 30th. Spending restraint, along with stronger revenue growth, is anticipated to help Arizona maintain structural balance in the fiscal 2016 budget and in the near future.
In 2013, the Oregon State Legislature passed two bills which collectively reduced the 2% cost-of-living adjustment (COLA) for State of Oregon Public Employees Retirement System (PERS) retirees and ended a payment intended to compensate out-of-state retirees paying Oregon income taxes, which resulted in approximately $5.3 billion in combined savings. Last week, the Oregon State Supreme Court overturned a significant portion of the previously enacted PERS reforms. The Supreme Court decision effectively restored the 2% cost-of-living-adjustment (COLA), reversing approximately $5 billion in combined pension liability reductions and eliminating potential future savings already incorporated into state and local government budgets. The court ultimately upheld the state’s ability to eliminate the income tax offset to out-of-state retirees, and said the legislature can change the COLA for benefits being offered to current and future PERS members. Read more “Oregon State Supreme Court Rules on PERS Reforms”
As the ‘baby-boom’ generation reaches retirement age at an estimated 8,000 to 10,000 people per day, according to AARP and the Pew Research Center, questions about Social Security increase.
The problem for many planning for retirement is that as the Social Security system has aged (it began in 1937 with the first check going out 75 years ago), it has become more and more complex. Further, while many begin taking benefits as soon as possible at 62 years old, the life expectancy has increased from around 60 in 1937 to close to 80 years old in 2013. Clearly, making the most of retirement income has become more important.
For these reasons, many financial advisers are choosing to focus some or all of their practice on retirement strategies and Social Security maximization. There are many resources available to these advisers. Read more “Complexities in Social Security drive baby boomers to seek advice”
During the Aquila Narragansett Tax-Free Income Fund Annual Shareholder meeting on April 2, 2015, Rhode Island State Treasurer, Seth Magaziner spoke to attendees, sharing his observations on the economy in Rhode Island. He pointed out that the financial position of the state is steadily improving, having reached a turning point with a new sense of optimism in the air. Read more “Rhode Island State Treasurer, Seth Magaziner, speaks to Fund shareholders”
We are pleased to announce that Aquila Three Peaks Opportunity Growth Fund has received a 2015 Lipper Fund Award, presented to Aquila Investment Management LLC.
Each year, Lipper recognizes funds and fund management firms for their consistently strong risk-adjusted performance relative to their peers, based on Lipper’s proprietary performance-based methodology. Aquila Three Peaks Opportunity Growth Fund Class Y received a Lipper Award in the Mid-Cap Core Category for the 3-year performance period ending 12/31/2014. At that time, the Lipper category included 324 funds. The Fund sub-adviser is Three Peaks Capital Management, LLC and the co-portfolio managers are Sandy Rufenacht and Zach Miller.
The equity investment strategy of Aquila Three Peaks Opportunity Growth Fund is very distinctive, with equity investment ideas generated in the process of conducting research on high yield debt issuers with financially responsible management teams that have used leverage to grow their business and who are committed to improving the corporate balance sheet. For certain companies, improvement in the corporate balance sheet may lead to improvement in the performance of the company stock.
We are honored that Aquila Three Peaks Opportunity Growth Fund has been recognized by Lipper for risk-adjusted performance. You will find more information about the investment strategy and performance of the Fund on this site.
Before investing in the Fund, carefully read about and consider the investment objectives, risks, charges, expenses, and other information found in the Fund prospectus. The prospectus is available on this site, from your financial adviser, and when you call 800-437-1020.
Shareholders of Aquila Tax-Free Fund of Colorado are cordially invited to attend their annual shareholder meeting May 13, 2015 at 2:00 p.m. in the Hyatt Denver Tech Center, 7800 E. Tufts Avenue, Denver, CO.
Attendees will have the opportunity to visit with Fund Executives, Trustees, the Portfolio Manager and hear Tom Binnings, Senior Partner, Summit Economics, LLC speak about the Colorado and national economy.
Please plan to attend. We look forward to seeing you on May 13th.
Rhode Island’s former Treasurer and recently appointed Governor, Gina Riamondo, has proposed an $8.6 billion budget for fiscal year 2016 designed to reenergize Rhode Island’s stressed economy. Included in her proposal is restructuring a portion of the State’s debt to enhance economic development. The debt restructuring is expected to generate a total of $83.9 million for the state over the next two fiscal years. Riamondo plans to allocate the funds to a school construction capital fund, a state infrastructure bank and toward economic development priorities in the old I-195 corridor in downtown Providence.
Zach Miller, Co-Portfolio Manager of Aquila Three Peaks Opportunity Growth Fund, provided comments for a February 21, 2015 article published by Barron’s regarding HCA Holdings (HCA). The firm has been a long-term holding in Aquila Three Peaks Opportunity Growth Fund and operates 166 hospitals and 113 surgical centers in 20 states. The Barron’s article discusses the business model and financial results of HCA Holdings, and evaluates the firm in the context of the Affordable Care Act and a related case currently pending before the U.S. Supreme Court. Read more “Zach Miller Comments on HCA in Barron’s”