Frequently Asked Questions
How do I invest?
Below are answers to many common questions. However, nothing written here should be considered as a substitute for the prospectus, which should be read carefully before investing. You may click here
to download a prospectus, or call 1-877-SMI-FUND to request one by mail.
Where do I send my investment?
You can get a prospectus and account registration form by downloading them here
, or email your request to us
for information to be sent through the U.S. Mail. They are also available by calling toll-free 1-877-SMI-FUND. After reading the prospectus carefully, fill out the account registration form and mail it with your initial investment. The SMI Funds are available at most leading brokerages.
Send your investment to:
Are the Sound Mind Investing Funds available through my broker?
I'm already an investor. How can I check on my account?
The Sound Mind Investing Funds are available for purchase at most leading brokerages. To request the Funds be added at a brokerage, email firstname.lastname@example.org
. If the Fund is not yet available on your brokerage platform, please call the platform and request that the Fund be added. Many brokerage platforms will not add a fund to the platform without shareholder demand.
Are the Sound Mind Investing Funds no-load?
Call 1-877-764-3863 between 9am and 5pm Eastern Time Monday through Friday to speak to a shareholder services representative about your account. Have your account number ready. You can also call this number 24 hours a day for current share price information and account balances. In addition, you can access your account information via this website - if you have not signed up already, you simply need to complete a brief registration process, after which we'll mail you your login information. Click here to get started.
Yes. The Sound Mind Investing Funds are no-load mutual funds, so you do not pay a sales charge when you purchase shares. If you redeem your shares within 60 days of purchase, you will be charged a redemption fee of 2.00%. See the current prospectus for more information.
What is the minimum investment?
You can open an account with the Sound Mind Investing Funds with a $2,500 minimum initial investment.
Do you offer Individual Retirement Accounts (IRAs)?
Individual Retirement Accounts (IRAs) and Uniform Gift/Transfer to Minors Accounts (UGMA/UTMA) may be opened with a $2,500 minimum initial investment. Coverdell Education Savings Accounts may be opened with a $2,000 minimum initial investment.
Those who invest $100 or more per month through the Automatic Investment Plan may open an account with NO minimum initial investment.
Can I open an account to save for my child's or grandchild's education?
Yes. You can open an IRA
with a $2,500 initial investment, transfer an existing IRA account from another institution, or even consolidate several existing IRA accounts into one of the Sound Mind Investing Funds' IRA accounts. The Funds offer Traditional, Roth and SEP IRAs.
Yes. Coverdell Education Savings Accounts may be opened with a $2,000 minimum initial investment. Uniform Gift/Transfer to Minors Accounts (UGMA/UTMA) may be opened with a $2,500 minimum initial investment.
How can I track the SMI Funds?
Many news and financial web sites report daily share prices using the fund ticker symbols (SMIDX, SMIFX and SMILX). While most financial web sites will have the daily share prices for the Funds each evening, many newspapers will not report them. This is because, as funds-of-funds, calculating the daily share price each evening requires us to wait to receive the pricing information from each underlying fund owned. As a result, the Funds are often unable to meet the early reporting deadline required to be included in many newspapers.
What's the history behind the Sound Mind Investing Funds?
Who manages the funds?
The Upgrading strategy has been advocated for many years by the Sound Mind Investing newsletter and has been followed by thousands of newsletter subscribers to implement an upgrading portfolio on their own. However, prior to the launch of the SMI Funds, no vehicle existed for investors who wanted to follow the newsletter's upgrading recommendations, but didn't want the responsibility of implementing the strategy on their own. In early 2004, the newsletter's publisher (Austin Pryor) and executive editor (Mark Biller) began to seriously consider starting an upgrading mutual fund, but ultimately concluded the time demands would be too significant to do so without a partner. In early 2005, a financial management firm named Omnium Capital contacted the newsletter about starting a fund based on the Upgrading investing strategy. After much deliberation, the decision was made to go forward, and Austin, Mark and the Omnium principals formed SMI Advisory Services, LLC, a registered investment advisory firm (the "Adviser"). The Adviser then began the long process of starting the Sound Mind Investing Fund (SMIFX) and serving as the Fund's investment adviser.
The SMI Balanced Fund (SMILX) was launched in 2011 to offer investors a convenient vehicle which provides professional management of both stock and bond portfolios by SMI Advisory Services.
The SMI Balanced Fund is normally invested with a roughly 60% stock, 40% bond allocation. The SMI Dynamic Allocation Fund (SMIDX) was launched in 2013 to offer investors a convenient vehicle which provides professional management of the Dynamic Asset Allocation (DAA) strategy by SMI Advisory Services.
Mark Biller, who is the Sound Mind Investing newsletter's executive editor, is a principal of the Adviser and serves as the Funds' senior portfolio manager. He has worked alongside Austin Pryor, publisher of the Sound Mind Investing newsletter, since January of 2000. So you can rest assured that the decisions made by Mark in managing the Funds are in keeping with the core investing philosophies advocated in the SMI newsletter. Although Austin is not involved in the day-to-day investment management of the Funds, he does have a significant ownership stake in the Adviser. Reams Asset Management* serves as the subadvisor responsible for managing the bond portion of the SMI Balanced Fund portfolio. When instructed to do so, Reams Asset Management* also manages individual bond securities and cash in the SMI Dynamic Fund portfolio.
Should I invest in the Funds, or implement DAA or Upgrading on my own using the newsletter?
*Reams Asset Management Services, a division of Scout Advisers, a wholly owned subsidiary of UMB
Do the Funds own the same funds recommended by the SMI newsletter?
That's a decision to be made based on your specific needs and financial plan, in consultation with your financial planner if you have one. Here are a few factors to consider in making that decision.
Implementing the strategies on your own with the newsletter will generally be less expensive. The Funds charge an extra layer of expenses on top of the expenses being paid to the underlying funds. You're basically paying a fee to have the Funds' managers implement the strategy for you.
While the Funds charge an extra layer of fees, they do offer certain advantages over implementing the strategies on your own. First, it's much easier and more convenient than managing your own portfolio. Plus, the Funds implement the strategies a little differently than you can.
Regarding Upgrading, as an institutional investor the Funds have a wider selection of underlying funds to choose from: they can often invest in load-waived funds and closed funds, funds with high minimum investment requirements, and institutional share classes. The Funds can often save on transaction costs and the expenses of the underlying funds.
Regarding DAA, the Fund will typically own some additional investments within the asset classes that are currently in favor. Additionally, the Fund will usually attempt to achieve a quicker “flight to safety” during periods of dramatic market change.
Plus you get daily professional management of the portfolios. But these advantages may or may not be enough to offset the additional expense of having the Funds implement the strategies on your behalf.
The Funds were designed primarily to help people who want to benefit from the strategies, but don't want to keep up with the process on their own. If that describes you, the Funds will likely be an attractive alternative to manually implementing the strategies in your own portfolio.
The Sound Mind Investing newsletter has a strong Christian emphasis. How does this impact the Funds? Are the Funds' investments screened?
Sometimes they will, but many times they won't. The Funds select which funds to buy and sell by utilizing the same basic methodology that the newsletter uses to determine which funds to recommend to its subscribers. However, there are some key differences between how the Funds will operate and how newsletter subscribers can implement the strategies on their own.
Regarding DAA, the Fund will be in the same asset classes as the newsletter, but there will often be differences in the securities held in each of the asset classes due to the process the Fund uses to select its securities and also due to the process the Fund uses to seek safety during periods of dramatic market change.
Regarding Upgrading, the Funds will likely have access at no additional cost to a wide variety of load-waived funds and institutional share classes that the newsletter does not recommend and newsletter subscribers cannot access on their own. This means the Funds are "shopping" in a much wider fund universe than the universe of recommended funds available to the newsletter's subscribers. In addition, the Fund portfolios are constantly monitored, every day, whereas the newsletter recommends portfolio changes just once per month.
As a result of those factors, the Funds will frequently own funds that are different from those recommended in the newsletter.
The Funds' investments are not screened. While the Funds are based on a strategy and philosophy developed by the Sound Mind Investing newsletter, which is overtly Christian, there's nothing specific to the Funds to make them "Christian" funds per se.
Why aren't the Sound Mind Investing Funds listed as recommended funds in the SMI newsletter?
The Sound Mind Investing Funds are designed to be owned instead of the newsletter's recommended funds, not in addition to them. Naturally you're free to use the funds as you see fit, but their purpose is to allow you to buy a single fund and have the managers carry out the full Upgrading or DAA process for you within one of the SMI Funds. So rather than have to buy and sell funds on your own using the monthly newsletter recommendations, you can buy one of the SMI Funds once and forget about it, knowing it will continue to implement the strategy on your behalf without requiring any further effort or attention from you.
The Funds may be designed as a "one stop shop," but is it safe to put all my eggs in one basket like this?
The level of diversification you need for your portfolio is something you'll need to determine for yourself. That said, the SMI Funds are potentially a useful "one stop shop" for your investing. Normally you wouldn't want all your money in any single fund. But because these are "funds of funds," the situation here is quite different.
Regarding the SMI Dynamic Allocation Fund, three broad asset classes are typically owned at any point in time. So your ownership of this single fund will always mean you are immediately diversified among at least three different asset classes. Furthermore, within each asset class, at least a portion of that money is typically devoted to some type of investment offering broad exposure to that particular asset class. For example, when U.S. Stocks are part of the Fund’s investments, at least a portion of the Fund will likely be invested in a broad-based instrument like the S&P 500 ETF (SPY or similar), offering broad exposure to the U.S. stock market.
Regarding the Upgrading Funds, both the SMI Fund and the SMI Balanced Fund each own at least 20 other stock funds within them. So you're really not putting all your eggs in one basket — you're still going to indirectly own at least 20 separate funds, much as an investor would if they were to upgrade on their own using the SMI newsletter's recommendations. The difference is that you can accomplish it with just one purchase through one of the SMI Funds, rather than having to buy 20 or more separate funds on your own. And of course the main benefit is you don't have to keep up with upgrading twenty or more funds on your own after that, you can just buy and hold one of the SMI Funds' "fund of funds" and have the upgrading process accomplished for you automatically.
Most investing professionals will tell you that one of your most important decisions as an investor is the asset allocation decision, specifically, how to divide your money between stocks and bonds. The SMI Balanced Fund normally invests with a roughly 60% stock, 40% bond allocation. Each investor will need to determine what their ideal personal allocation looks like. At that point, the SMI Balanced Fund may or may not be a helpful tool in achieving that target allocation. Note that asset allocation does not ensure a profit or guarantee against loss.
For example, an investor who desires more stock exposure than the 60% provided in the SMI Balanced Fund (SMILX) can easily increase their portfolio’s total stock exposure by also purchasing shares of the flagship SMI Fund (SMIFX). For example, an investor with a total portfolio of $100,000 who desires an 80% stock/20% bond overall allocation could invest half their money in SMILX and half in SMIFX. The half in SMILX would roughly represent $30,000 in stocks and $20,000 in bonds, while the half in SMIFX would roughly translate to another $50,000 in stocks. Combined, they would total roughly $80,000 in stocks and $20,000 in bonds, which would be close to the investor’s 80/20 target.
Alternatively, an investor who desires more bond exposure than the 40% provided in the SMI Balanced Fund (SMILX), can easily increase their portfolio’s total bond exposure by also purchasing shares of a separate bond fund (or multiple bond funds). For example, an investor with a total portfolio of $120,000 who desires a 50% stock/50% bond allocation could invest $100,000 in SMILX while investing the remaining $20,000 in one or more pure bond investments of their choosing. The net effect of this would be to have roughly $60,000 of stock exposure and $40,000 of bond exposure through SMILX. Adding the additional $20,000 of bonds via another pure bond investment would bring the portfolio into roughly a 50-50 balance.
Asset allocation does not ensure a profit or guarantee against loss.
Should I invest in the SMI Funds directly or through my Schwab/Fidelity/Etc. account?
How can I find out more?
You can do either. In many cases it will be slightly less expensive to invest directly with the Sound Mind Investing Funds. Most brokerages charge a transaction fee to buy the Funds, whereas it's free to invest with the Funds directly. That may not be a significant expense if making just a single purchase, but it definitely could be if you plan to add to your account regularly. See the Open An Account page for details.
If the Fund is not yet available on your brokerage platform, please call the platform and request that the Fund be added. Many brokerage platforms will not add a fund to the platform without shareholder demand.
Review the prospectus for more complete information, including fees and expenses. Please read it carefully before you invest or send money.
Feel free to email email@example.com
or call toll-free 1-877-SMI-FUND (877-764-3863)
if you have additional questions.