55509_Ladenburg-Boyar Fund_Q3_2013_Front

Performance
Update
The Boyar Value Fund
September 30, 2013
A Multi-Cap Value Fund Seeking
Long-Term Capital Appreciation
BOYAX
Overall
The Lipper ratings are subject to change every month and are
based on an equal-weighted average of percentile ranks for the
Tax Efficiency metrics over three-, five-, and ten-year periods (if
applicable). The highest 20% of funds in each peer group are
Portfolio Manager:
Mark Boyar, President, Boyar Asset Management
Investment Objective:
Long-term capital appreciation by primarily investing
in multi-cap stocks that Mr. Boyar perceives to be
undervalued relative to their intrinsic value
Inception Date:
5/5/98
Minimum Investment:
$5,000 ($3,000 for IRAs)
Nasdaq Symbol:
BOYAX
H ISTORICAL C OMPETITIVE R ETURNS
Share price and investment return will fluctuate such that an investor’s shares may
be worth more or less than their original cost upon redemption. Past performance
data quoted represents past performance.
named Lipper Leaders, the next 20% receive a score of 4, the
middle 20% are scored 3, the next 20% are scored 2, and
Average Annual Returns
the lowest 20% are scored 1.
1 Year
Lipper ratings for Tax Efficiency reflect a fund’s historical success
At NAV
Inclusive of sales charges
After taxes on distribution
After taxes on distribution
and the sale of shares
S&P 500 Index
in postponing taxable distributions relative to peers, as of
*(5/5/98)
Lipper Leader ratings are not intended to predict future
results and Lipper does not guarantee the accuracy of this
information.
3 Year
(through 09/30/13)
5 Year
Since
10 Year Inception*
22.41%
16.30%
16.24%
16.55%
14.58%
14.46%
10.53%
9.40%
9.27%
5.52%
4.99%
4.62%
6.04 %
5.68%
5.32%
9.30%
19.34%
11.47%
16.27%
7.45%
10.02%
3.99%
7.57%
4.60%
4.60%
09/30/13. Tax Efficiency offers no benefit to investors in
tax-sheltered accounts such as 401(k) plans.
Cumulative Returns Since Inception*
S&P 500 Index
100.02%
More information is available at www.lipperleaders.com.
Lipper Leader ratings © 2013 Reuters, All Rights Reserved.
*(5/5/98)
Boyar Value Fund
146.67%
Past performance is not indicative of future
results. Current performance may be lower
or higher than quarterly performance. For
current, to the most recent month end, performance please go to www.ladenburg.com.
The Boyar Value Fund has a maximum sales
charge of 5.00%. After-tax returns are calculated using the highest historical individual
federal income tax rate and do not reflect the
additional impact of state and local taxes.
Actual after-tax returns depend on a shareholder’s tax situation and may differ from
those shown. After-tax returns are not relevant for shareholders who hold fund shares
in tax-deferred accounts or to shares held by
non-taxable entities. It is important to note
that the Fund is currently waiving a portion of
fees and at such time as the fee waiver is no
longer in place, future returns may be lower
than past returns.
The S&P 500 Index is an unmanaged index of
stocks trading in the United States. Index performance illustrated is hypothetical and is not
indicative of any mutual fund investment.
Investors cannot invest in an index.
The value of the portfolio will fluctuate as the
underlying securities move in response to
overall market movements and other factors
beyond the control of the advisor, and investments in the fund may result in the loss of
principal. The fund may invest in stocks of
several different capitalization levels and it is
important to note that historically, small- and
mid-cap stocks have experienced greater
volatility than stocks of larger, more established companies.
Mark Boyar
THIRD QUARTER 2013
Mark began his career as a securities analyst in 1968. In 1975, he founded
Performance Review For The Boyar Value Fund
Asset Analysis Focus, a subscription-based, institutional research service
The month of September marked the five year anniversary of the collapse of
focused on value investing. He quickly began managing money for high
Lehman Brothers. Stocks certainly have had quite a run since that period,
net worth clients and later formed Boyar Asset Management, a registered
advancing by ~155%, as measured by the S&P 500 from their March 2009
investment advisor, in 1983. He began managing the Boyar Value Fund
in 1998. His opinions are often sought by such media outlets as Barron’s,
BusinessWeek, CNBC, Forbes, Financial World,The New York Times and
lows.
It is clearly more difficult to find bargains today than when former significant
The Wall Street Journal.
holdings in the Fund like CBS traded for $6 per share (current price ~$59.00),
or when Saks was trading at a $1.85 (current price ~$16.00) and is on its way
Top Ten Equity Holdings (As of 09/30/13)
to being acquired. For the moment, the days of six or seven baggers (stocks
Holdings
rising six-or- sevenfold) are over.
1. The Travelers Companies, Inc.
4.27 %
2. Ameriprise Financial Inc.
3.68 %
Politics and policy dominated the markets in the third quarter, especially
3. Pfizer Inc.
3.48 %
during the eventful, nerve racking and surprising final weeks that left the
4. Home Depot, Inc.
3.46 %
markets in a state of heightened uncertainty. A trifecta of events, that included
5. Time Warner Inc.
3.36 %
6. Microsoft Corp.
2.93 %
7. Disney (Walt) Company
2.91 %
8. Wendy’s Co.
2.82 %
government shut down, and the potential for the debt ceiling not to be raised
9. J.P. Morgan Chase & Co.
2.64 %
which almost contributed to a technical default on U.S. debt obligations, all
10. Comcast Corp. - Class A
2.27 %
contributed to the uncertainty.
Total
31.82%
The above illustrates the Fund’s ten largest equity holdings, as a percentage of total assets, as of 09/30/13 and are subject to change.
the Federal Reserve's decision not to commence the tapering of its $85 billion
per month bond buying program, which surprised most pundits; the
After closing at 1,725.52 on September 18th, the day of the Fed decision to
continue with tapering; the Standard & Poor's 500- stock index fell on seven
Industry Weightings
Healthcare - Services 0.5%
Semiconductors 0.9%
Telecommunications 1.1%
Apparel 1.2%
Electrical Components & Equipment 1.4%
Miscellaneous Manufacturing 1.5%
Entertainment 1.8%
Lodging 1.9%
Transportation 2.2%
Internet 2.2%
of the last eight trading days of the quarter. Even with the weakness at the end
(As of 09/30/13)
Cash & Cash Equivalents 26.5%
of the quarter, the S&P 500 gained a very respectable 5.24% for the past three
months. The more speculative Russell 2000 and the NASDAQ Composite
Real Estate 0.1%
Media 12.6%
fared even better advancing 10.21% and 10.82% respectively. The Boyar
Value Fund advanced by 3.66% for the quarter making our year to date
performance a positive 19.69% versus an advance of 19.79% for the S&P 500.
We are quite pleased with that performance due to the fact that our cash
Retail 8.9%
Commercial Services 2.3%
Leisure Time 2.3%
Household Products/Wares 2.9%
Software 2.9%
position throughout 2013 has averaged 23.58% which equates to approximately 25% return on equity for the year. So in effect we kept pace with the
market and took significantly less risk.
Banks 7.5%
Continued on page 3.
Pharmaceuticals 6.5%
Insurance 4.3%
Food & Beverage 5.2%
The above illustrates the Fund’s industry weightings, as a percentage of total assets, as of 09/30/13 and are subject to change.
The mention of specific securities, countries or asset classes is not a recommendation or solicitation for any person to buy, sell or hold any particular security. Investors should
consider the investment objectives and policies, risk considerations, charges and expenses of this fund carefully before investing. The prospectus contains this and other information
relevant to an investment in the fund. Please read the accompanying prospectus carefully before you invest or send money. If a free prospectus did not accompany this literature,
please contact your securities representative or the Boyar Value Fund, 570 Lexington Avenue, 11th Floor, New York, NY 10022, 800 523-8425.
N O T
F D I C - I N S U R E D
•
N O T
B A N K - G U A R A N T E E D
Ladenburg Thalmann & Co., Inc.
570 Lexington Avenue
11th Floor
New York, NY 10022
•
M A Y
L O S E
VA L U E
800.523.8425
www.ladenburg.com
NYSE, NYSE Amex, FINRA and all other
principal exchanges. Member SIPC.
06/30
Where Do We Go From Here?
• The current bull market is approximately 54 months long and the average bull market since 1921 has been 29 months.
• The average price increase from the bottom in the past 17 bull markets has been ~153% vs. the ~155% jump in the S&P 500 from March 9, 2009.
• The longest and strongest bull market which ended with the bursting of the tech bubble lasted 113 months and climbed 417%.
• The six bull markets of the 17 that have occurred since 1921 have seen better stock gains than the current one.
• The average price to earnings ratio since 1999 has approximated 16.6x. The projected 2014 P/E of the S&P 500 is currently around 14.5x.
Typically bull markets come to an end following a period of extraordinary performance. In other words, some of a bull market's best returns occur right before it
dies. Remember the NASDAQs performance in the 4th quarter of 1999 when it advanced ~48%? The NASDAQ hit its all-time high four months later, just
before the bubble burst. In the months leading to market tops there are striking similarities that often occur. Growth stocks outperform value stocks and small
capitalization stocks outperform their larger brethren. There are early signs today that such a trend has commenced.
Currently there are a number of companies that have captured Wall Street's fancy each with multiples of 100xs or more. They include names like Netflix, Zillow
and LinkedIn. Tesla is another example of a high multiple stock. The company delivered just 1400 cars in July or about 1% of Ford Motor Company’s sales for
the same month. Today Tesla commands a market valuation of over $21 billion. This is about a third of Ford's market cap and approximately triple that of Fiat
which is the majority owner of Chrysler.
Although there are some early indications that the U.S equity market is getting somewhat frothy, it could still have some more room to run. Yes, it is true the
more speculative technology laden NASDAQ, and the small capitalization Russell 2000 have become the market leaders. Momentum stocks, such as Tesla and
Netflix, each with triple digit P/E ratios, have also become market darlings. On the other hand during the 1990's large capitalization stocks such as Microsoft,
Pfizer, Cisco and Intel to name a few commanded outsized price/earnings ratios of 40x to 150x. Today, the P/E ratios of those companies average approximately 12x, well below the multiples of most of the companies within the S&P 500. These companies also yield 3% or more, with the capability of multiple dividend
increases during the next five years.
There are a number of other factors that could help continue the stock market’s advance for a while longer. The Federal Reserve’s low interest rate policy,
which includes the purchase of $85 billion per month in U.S. Government obligations, shows no signs of abating. The Fed in fact has green lighted asset
purchases with its easy money bias.
Individual investors usually show up late for the party, but they usually do show up. As a result of both individual and institutional investors fleeing the equity
markets en masse during the 2007- 2009 period, common stocks are currently under owned, while bonds have a much higher weighting than normally is the
case. A higher asset allocation into stocks could prolong the stock market advance.
To summarize, the overall stock market is probably fairly valued. Stocks are not on the bargain basement table as they were in 2008-2009. Temper
your expectations in terms of expected future returns, and be wary of momentum stocks with triple digit P/E ratios
Best regards,
Chief Investment Officer
The mention of specific securities, countries or asset classes is not a recommendation or solicitation for any person to buy, sell or hold any particular security. Investors should
consider the investment objectives and policies, risk considerations, charges and expenses of this fund carefully before investing. The prospectus contains this and other information
relevant to an investment in the fund. Please read the accompanying prospectus carefully before you invest or send money. If a free prospectus did not accompany this literature,
please contact your securities representative or the Boyar Value Fund, 570 Lexington Avenue, 11th Floor, New York, NY 10022, 800 523-8425.
N O T
F D I C - I N S U R E D
•
N O T
B A N K - G U A R A N T E E D
Ladenburg Thalmann & Co., Inc.
570 Lexington Avenue
11th Floor
New York, NY 10022
•
M A Y
L O S E
VA L U E
800.523.8425
www.ladenburg.com
NYSE, NYSE Amex, FINRA and all other
principal exchanges. Member SIPC.
06/30