Ultra-hip mutual fund company Thrasher Funds takes aim at the long-coveted young investor market with their just-launched and peculiarly capitalized GendeX Mutual Fund.
The GendeX Mutual Fund was developed and is managed by young adult investors for young adult investors. A group of more than 60 million Gen X and Y'ers largely untapped by the financial market place...until now.
The GendeX Mutual Fund offers this demographic the opportunity to leverage their youth, along with a disciplined investment and savings strategy to help use what they already know to engage the stock market. We provide this Next Generation of investors the opportunity to invest in markets near to them, while providing the structure, fundamentals, and diversity currently available in investment products aimed at older generations.
We created The GendeX Fund for any investor who does not feel a connection to the traditional investment establishment. Welcome Home."
Besides a website featuring photos of attractive twenty-somethings and even an original soundtrack, the new no-load fund attempts to woo young investors by offering an initial minimum investment requirement of just $100 with enrollment in an automatic investment plan ($2,500 minimum for non-AIP investments). The fund is on the expensive side with a 1.5% (capped) total expense ratio. There is also a a $2 per month maintenance fee for accounts under $2,500, and a 2% redemption fee shares sold within a year of purchase – a bit high and long for a fund that owns mostly actively traded U.S. stocks.
The fund's investment strategy also comes with a hipster hook. Fund manager James C. Perkins, Jr. will identify attractive investments using what he calls the Demographic Convergence Thesis a "proprietary model seeks to capitalize on the convergence of what the firm believes to be two generational socioeconomic trends: the Baby Boomer generation’s increased life expectancy, elongated career life cycle, along with its member’s propensity to emulate younger lifestyles, and simultaneously, Generations X and Y’s increased access to capital and increasingly younger financial maturity." The fund's current holdings list includes companies like Apple (of course), Volkswagon and American Apparel (Endeavor Acquisition Corp - EDA).
So should you re-route some of your disposable skateboard/sushi/tattoo money to the GendeX? While we're (alas) no longer in the target demo, we’re not against investments targeted to younger investors. Any company that can get people to invest at an earlier age is good by us – it wasn’t that long ago (seven years ago actually) that we held our MAXfunds.com Young Investor Summit in New York City.
As for the actual investment strategy, we’re a little suspicious of demographic trend investing, notably because noted Dow 40,000 futurist Harry Dent's underwhelming AIM Dent Demographic Trends Fund. That said we’ve always felt Wall Street doesn’t really understand young people, fads, and trends. Traditional investors don’t really get video game stocks, they missed the Apple turnaround, and generally get on board of a trend after it takes off – like Urban Outfitters (URBN). We’ll have to see if these fund managers have that finger on the pulse of the young.
For other young investors looking for a more traditional choice, we would go with a good old-fashioned investment in the decidedly un-hip Vanguard Target Retirement 2050 Fund (VFIFX). Vanguard does have a $3,000 minimum investment requirement, but subsequent investments can be as low as $100.
Like other lifecycle funds, this Vanguard fund gets increasingly more conservative as retirement nears and is meant to be a one stop invest-and-forget portfolio.
Ultra-hip mutual fund company Thrasher Funds takes aim at the long-coveted young investor market with their just-launched and peculiarly capitalized GendeX Mutual Fund.
According to the firm's website:
The GendeX Mutual Fund was developed and is managed by young adult investors for young adult investors. A group of more than 60 million Gen X and Y'ers largely untapped by the financial market place...until now.
The GendeX Mutual Fund offers this demographic the opportunity to leverage their youth, along with a disciplined investment and savings strategy to help use what they already know to engage the stock market. We provide this Next Generation of investors the opportunity to invest in markets near to them, while providing the structure, fundamentals, and diversity currently available in investment products aimed at older generations.
We created The GendeX Fund for any investor who does not feel a connection to the traditional investment establishment. Welcome Home."
Besides a website featuring photos of attractive twenty-somethings and even an original soundtrack, the new no-load fund attempts to woo young investors by offering an initial minimum investment requirement of just $100 with enrollment in an automatic investment plan ($2,500 minimum for non-AIP investments). The fund is on the expensive side with a 1.5% (capped) total expense ratio. There is also a a $2 per month maintenance fee for accounts under $2,500, and a 2% redemption fee shares sold within a year of purchase – a bit high and long for a fund that owns mostly actively traded U.S. stocks.
The fund's investment strategy also comes with a hipster hook. Fund manager James C. Perkins, Jr. will identify attractive investments using what he calls the Demographic Convergence Thesis a "proprietary model seeks to capitalize on the convergence of what the firm believes to be two generational socioeconomic trends: the Baby Boomer generation’s increased life expectancy, elongated career life cycle, along with its member’s propensity to emulate younger lifestyles, and simultaneously, Generations X and Y’s increased access to capital and increasingly younger financial maturity." The fund's current holdings list includes companies like Apple (of course), Volkswagon and American Apparel (Endeavor Acquisition Corp - EDA).
So should you re-route some of your disposable skateboard/sushi/tattoo money to the GendeX? While we're (alas) no longer in the target demo, we’re not against investments targeted to younger investors. Any company that can get people to invest at an earlier age is good by us – it wasn’t that long ago (seven years ago actually) that we held our MAXfunds.com Young Investor Summit in New York City.
As for the actual investment strategy, we’re a little suspicious of demographic trend investing, notably because noted Dow 40,000 futurist Harry Dent's underwhelming AIM Dent Demographic Trends Fund. That said we’ve always felt Wall Street doesn’t really understand young people, fads, and trends. Traditional investors don’t really get video game stocks, they missed the Apple turnaround, and generally get on board of a trend after it takes off – like Urban Outfitters (URBN). We’ll have to see if these fund managers have that finger on the pulse of the young.
For other young investors looking for a more traditional choice, we would go with a good old-fashioned investment in the decidedly un-hip Vanguard Target Retirement 2050 Fund (VFIFX). Vanguard does have a $3,000 minimum investment requirement, but subsequent investments can be as low as $100.
Like other lifecycle funds, this Vanguard fund gets increasingly more conservative as retirement nears and is meant to be a one stop invest-and-forget portfolio.
See also: Ask MAX: What does MAX think of the Vanguard Target Retirement Fund?