10/16/2017

Estimated capital gains as of October 16, 2017

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The funds listed below may pay a capital gain distribution in December, 2017.  The amount reflected represents an estimate, per share, as of the date indicated.               Printable Version

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXShort-Term          Long-Term

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXEstimate               Estimate

Aquila Three Peaks Opportunity Growth Fund1                           $0.33                    $2.03

Aquila Tax-Free Trust of Arizona2                                        $0.00                    $0.02

Aquila Churchill Tax-Free Fund of Kentucky2                      $0.00                    $0.01

1 The preliminary distribution amount above can be reduced by any losses realized by October 31, 2017.

Represents undistributed gains from fiscal year 2017 which must be distributed in 2017 and cannot be reduced.

Read more “Estimated capital gains as of October 16, 2017”

10/11/2017

Annual Shareholder Meeting November 9th

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Aquila Tax-Free Trust of Arizona

Shareholders of Aquila Tax-Free Trust of Arizona and financial professionals are invited to attend the Annual Shareholder Meeting scheduled at 9:30 a.m. on November 9, 2017.  The meeting will take place at the JW Marriott Scottsdale, Camelback Inn Resort & Spa located at 5402 E. Lincoln Drive in Scottsdale.

An additional outreach meeting will take place at 10:00 a.m. on November 8, 2017 at the Union Hills Golf & Country Club in the Main Dining Room, located at 9860 Lindgren Avenue in Sun City.

Breakfast will be served prior to both meetings.

John Lucking, former Aquila Tax-Free Trust of Arizona Independent Trustee and Chair, and President of Econ-Linc, an economic consulting firm in Phoenix, will be speaking about the Arizona and national economy. Read more “Annual Shareholder Meeting November 9th”

10/11/2017

Annual Shareholder Meeting October 12th

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Aquila Tax-Free Fund For Utah

Shareholders of Aquila Tax-Free Fund For Utah and financial professionals are invited to attend the Annual Shareholder Meeting scheduled at 8:30 a.m. on October 12, 2017.  The meeting will take place at the Sheraton Salt Lake City Hotel in the Bryce Canyons Ballroom.  The Sheraton Salt Lake City Hotel is located at 150 West 500 South in Salt Lake City.  This is a new venue for the Annual Shareholder Meeting, and a buffet breakfast will be served prior to the meeting.

Utah State Senator and former Aquila Tax-Free Fund For Utah Trustee, Lyle Hillyard, will be speaking about the Utah economy. Read more “Annual Shareholder Meeting October 12th”

09/20/2017

Harvey, Irma and the Muni Market

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With two hurricanes recently making landfall in southern states, only eleven days apart and inflicting what may be as much as $230 billion in damages, the potential impact to municipal credits is on investors’ minds. While both hurricanes made landfall in areas with booming economies and population growth, history tells us that the fiscal strength of the affected municipalities and the rapid relief efforts are likely to limit negative impacts on municipal bonds.

Hurricane Harvey hit Houston as a category 4 storm on August 25th and stayed over the area for several days dropping as much as 50 inches of rain in Harris County, which includes the city of Houston, and surrounding areas. Houston is the nation’s fifth largest municipal economy and Harris County is home to over four million people. Read more “Harvey, Irma and the Muni Market”

09/19/2017

Consumer resources related to Equifax data breach

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Following are resources which may be valuable to consumers concerned about the recent Equifax data breach.

Federal Trade Commission

Free credit freezes from Equifax, Lisa Weintraub Schifferle, Attorney, FTC, Division of Consumer & Business Education

Fraud alert or credit freeze – which is right for you?, Lisa Weintraub Schifferle, Attorney, FTC, Division of Consumer and Business Education

The Equifax Data Breach: What to Do, Seena Gressin , Attorney, Division of Consumer & Business Education, FTC

To report identity theft and get a recovery plan, visit Federal Trade Commission IdentityTheft.gov

State Attorneys General

Arizona Attorney General Mark Brnovich,

AG Brnovich Launches Investigation into Equifax Data Breach Calls for Equifax to Disable Fee-based Monitoring Services Link

Colorado Attorney General Cynthia Coffman,

Equifax data breach: 5 steps to take to protect yourself

Hawaii AG Douglas Chin,

State opens investigation into Equifax breach, offers advice for Hawaii residents

Kentucky Attorney General Andy Beshear,

Beshear, 33 AGs Demand Equifax Provide Better Safeguards and Improve Consumer Services Following Massive Data Breach

Oregon Attorney General Ellen F. Rosenblum,

Equifax Data Breach: What You Need to Know

Rhode Island Attorney General Peter F. Kilmartin,

AG Kilmartin, Investigating AGs Ask Equifax to Disable Fee-Based Monitoring Services, Reimburse Fees for Security Freezes

Utah Attorney General Sean D. Reyes,

Utah Attorney General’s Office Urges Consumers to be Cautious Following the Equifax Data Breach

09/05/2017

The Wall Street Transcript Interviews Co-Portfolio Manager Zach Miller

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Zach Miller, CFA

The Wall Street Transcript recently spoke with Aquila Three Peaks Opportunity Growth Fund’s Co-Portfolio Manager Zach Miller, and discussed how the Fund’s Managers use their expertise in analyzing high-yield issuers to help them discover opportunities in the equity market.

Through this interview you’ll hear directly from Zach regarding why the management team chose several of the most recent quarter-end holdings of Aquila Three Peaks Opportunity Growth Fund, and what they think about certain sectors in the current market.

 

Before investing in a 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.

 

 

07/26/2017

Moody’s Downgrades Kentucky Debt

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On July 20, 2017, Moody’s Investors Service (Moody’s) downgraded the Commonwealth of Kentucky’s issuer rating to Aa3 from Aa2. Simultaneously, other Kentucky government entities were also downgraded, including Kentucky’s general fund appropriation lease revenue bonds to A1 from Aa3, Kentucky’s agency fund appropriation lease-revenue bonds to A2 from A1, the Kentucky Public University Intercept Program to A1 from Aa3, the Kentucky School District Enhancement Program to A1 from Aa3, and the Kentucky Turnpike Authority to Aa3 from Aa2. Reasons cited for the downgrades were the large unfunded pension liability, high fixed government costs and revenue underperformance. Moody’s credit outlook for the state remains stable.

The downgrades have been expected for some time as Kentucky continues to battle one of the largest unfunded pension burdens in the U.S. The state experienced positive revenue growth of 5.3% in fiscal year 2015, but saw a decline of 3.7% in fiscal year 2016, followed by a decline of 1.3% in fiscal year 2017. Despite the credit rating downgrade, the Kentucky Turnpike Authority exceeded revenue projections for the recent fiscal year.

Kentucky’s economy is considered stable and employment continues to strengthen. If the expected manufacturing expansions by Amazon, Ford and Toyota come to fruition, we believe that the credit ratings may see a reversal over the next couple of years. Moody’s mentioned in their report that the State’s current administration has demonstrated a willingness to cut expenditures and balance the budget. As of June 30, Kentucky’s available liquid resources remained at $4 billion, a level that has been maintained over the past four years, and the general fund had a $239 million balance.

The portfolio managers and credit analysts of Aquila Churchill Tax-Free Fund of Kentucky will continue to monitor all credits in the portfolio. The only impact we see to the portfolio at this time is a downward shift in the quality breakdown directly related the downgrades. Kentucky debt pricing has stabilized in the secondary market due to the lack of new issuance, which was down 38% year-over-year at the end of the second quarter. For the most recent quarter-end performance, holdings and manager commentary please see the Fund page on this web site.


Before investing in a 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.

07/13/2017

Got Bonds? An update on Colorado municipal bond issuance

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Colorado started 2017 by “running out of the gate” with strong supply of tax-exempt municipal bonds evidenced by net issuance hitting $1.28 billion in January, due primarily to a record $3.21 billion in general obligation bonds approved across the state during the November 2016 election. Net issuance is the difference between the volume of municipal bonds issued and the amount matured or called. More recently, net issuance in Colorado has declined by $1.54 billion in June, due to $1.82 billion of municipal bonds maturing or being called.

Source: Bloomberg

Demand for Colorado bonds has strengthened in recent months due not only to the impact of declining net issuance, but also the increased dollars sitting on the sidelines as the result of bonds maturing or being called. We expect supply constraints and strong demand for municipal bonds will continue for at least the next several months as municipal bond issuance is unlikely to satisfy investor demand. Lipper US Fund Flows data released recently indicates municipal bond mutual funds have seen an average weekly year-to-date inflow of approximately $236 million as investors are facing increasing difficulty sourcing bonds. In addition, credit spreads between high and low investment grade municipal bonds have tightened to the point that investors are assuming measurable credit risk for the addition of only a few basis points.

Vasilios Gerasopoulos
Vice President, Municipal Bond Credit Analyst
Kirkpatrick Pettis Capital Management

Investments in bonds may decline in value due to rising interest rates, a real or perceived decline in credit quality of the issuer, borrower, counterparty, or collateral, adverse tax or legislative changes, court decisions, market or economic conditions.

07/13/2017

Got Bonds? An update on Oregon municipal bond issuance

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2017 has seen a significant shift in issuance due to the $1.76 billion in general obligation bonds approved during the November election and the $1.5 billion approved during the May election. As a result, new money issues have lead the charge in Oregon in 2017. Overall, 2017 has been a strong year for issuance with new issues outpacing last year at over twice the issuance through June. Yet, due to a large amount of maturities and calls, demand remains robust with new issues continuing to price aggressively. Net issuance is the difference between the volume of municipal bonds issued and the amount matured or called. Net issuance in Oregon for the first half of the year has been positive. However, in June, net issuance plummeted by $2.56 billion due to $2.17 billion of municipal bonds maturing or being called.

Source: Bloomberg

Demand for Oregon bonds has strengthened in recent months due not only to the impact declining net issuance, but also the increased dollars sitting on the sidelines as the result of bonds maturing or being called. We expect supply constraints and strong demand for municipal bonds will continue for at least the next several months as municipal bond issuance is unlikely to satisfy investor demand. Lipper US Fund Flows data released recently indicates municipal bond mutual funds have seen an average weekly year-to-date inflow of approximately $236 million as investors are facing increasing difficulty sourcing bonds. In addition, credit spreads between high and low investment grade municipal bonds have tightened to the point that investors are assuming measurable credit risk for the addition of only a few basis points.

Tim Iltz
Vice President, Municipal Bond Credit Analyst
Kirkpatrick Pettis Capital Management


Investments in bonds may decline in value due to rising interest rates, a real or perceived decline in credit quality of the issuer, borrower, counterparty, or collateral, adverse tax or legislative changes, court decisions, market or economic conditions.

06/14/2017

Active and Passive Management: A Blended Approach

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A heightened focus regarding fees and investor protection has generated an increased number of headlines around the decades-old debate between active and passive fund management. Historically, investors have viewed the two theories of management as one-verses-the-other, and many investors have been known to fluctuate between the two based on which style is in favor; in recent years, the trend has tilted toward passive management. Lower volatility, monetary policy and economic recovery have made it more difficult for active managers to consistently beat their benchmarks. However, history tells us that when passive management becomes oversaturated, the pendulum often swings back toward active. While we don’t anticipate a major shift away from passive, there are attractive aspects of active management that should be considered – and we believe that a combination of both styles creates a strong and timeless portfolio.

The shift to passive fund management

Investing in passive mutual funds is unquestionably a way to reduce investment fees that can drag on fund performance while maintaining exposure to a wide variety of investment styles. Fee-conscious investors, Financial Advisors and Broker Dealers are all embracing the idea of balancing less active portfolio management and research against the potential of earning benchmark returns from simply tracking the overall market.

Passive funds are particularly attractive in areas where markets are extremely efficient, where information is readily available, and where the ability to uncover opportunities to beat the market is rare. Take the U.S. large-capitalization segment for example; only 5% of portfolio managers in that segment who beat their index for three consecutive years also beat their index the following three years, according to S&P Dow Jones Indices*. Passive funds can also be an attractive tax-efficient investment; particularly those that track more narrowly focused benchmarks.

Overall, the mutual fund industry has benefited from the increase in the number of passive funds. Low-cost providers have driven down the cost of active funds, while sharpening the focus of active managers on performance and fund expenses.

Do investors still benefit from active management?

We think so. While passive funds may be attractive from a fee and tax-efficient standpoint, they do have drawbacks. Markets have inefficiencies, which passive managers cannot exploit. Managers following an index lack the ability to make adjustments based on market conditions and research discoveries. For instance, active managers can judge when to raise cash levels, in order to reduce potential downside exposure, when markets react to external events. Active managers also have the ability to weight holdings according to where they see value, while most passive approaches are weighted to align with the chosen index, for instance by market capitalization – giving more exposure to well-established companies that may have less growth potential.

Read more “Active and Passive Management: A Blended Approach”