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Franklin Mutual Recovery Fund

Fund Category: ValueGo to Prices & Performance page
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Symbol FMRAX
CUSIP 354 02P 203
Fund Number 471
Inception Date1 Jun 02, 2003
Distributions Annually
Total Net Assets
(all share classes)
As of 03/31/2014
$61.4
(millions)

As of  04/17/2014

NAV2 $12.34  
NAV Change $0.05  
POP3 $13.09  
YTD Total Return at NAV 1.90%
Distribution Rate at NAV N/A
30-day Standardized Yield
N/A

Average Annual Total Returns4
As of Quarter End 03/31/2014

w/ Sales Charge w/o Sales Charge
1 Yr 12.03% 18.86%
5 Yrs 13.45% 14.81%
10 Yrs 3.86% 4.48%
Life 5.31% 5.88%

Expense Ratio and Sales Charge As of 08/01/2013 (updated annually)

Gross Expense Ratio5,6 2.83%
Net Expense Ratio 1.49%
Max Initial Sales Charge 5.75%
CDSC 0.00%
12b-1 Fee 0.29%

Fund Description

Strategy Statement
Portfolio Managers
Shawn Tumulty
"The fund was created to provide exposure to our expertise in event-driven situations (distressed securities and risk arbitrage) and undervalued equities with an identifiable catalyst to unlock value."

Shawn Tumulty
Joined Mutual Series in 2000
Managed Fund since 2005

Strategy, Benefits, Results

Strategy

At Mutual Series, we focus on recognizing value that other investors might miss.

Our goal with this fund is to deliver solid, risk-adjusted returns with moderate correlation to the U.S. equity markets by investing mainly in the three categories described below:

  • Distressed Companies. We focus on companies that are, have been, or are about to be, involved in financial restructurings, reorganizations, or bankruptcy.
  • Merger Arbitrage Securities. We invest in companies involved in restructurings (mergers/acquisitions, consolidations, liquidations).
  • Special Situations/Undervalued Securities. We seek companies that are trading at prices substantially below or above their intrinsic value by investing in either long (below) or short (above) positions in equity securities.

THE QUARTERLY TENDER OFFER PROCESS

Mutual Recovery Fund is structured as a continuously offered, closed-end investment company due to the relatively illiquid nature of many of the fund’s investments. Investors can purchase shares on any day the markets are open, but shares aren’t redeemed daily. Instead, Mutual Recovery Fund offers to buy back 5%–25% of the outstanding shares each quarter during the tender offer period. The fund may suspend or postpone a tender offer subject to approval by the fund’s board.

Benefits

  • Event-Driven Investing. The managers' experience in investing in distressed securities, arbitrage scenarios and special situations make this a unique offering in the industry.
  • Activist Investors. Managers go the extra mile and will influence company management to help unlock that company's full potential for the benefit of our shareholders.
  • Low Correlation to Broader Markets. Event-driven securities tend to be affected less by broad market movements than by the specifics surrounding each particular situation.

Results

Hypothetical $10K Investment

Hypothetical $10K Investment

Investing in the Fund

What Are the Risks?
  • All investments involve risks, including possible loss of principal.
  • Stocks historically have outperformed other asset classes over the long term, but tend to fluctuate more dramatically over the short term.
  • Value securities may not increase in price as anticipated, or may decline further in value.
  • Investments in companies engaged in mergers, reorganizations or liquidations involve special risks as pending deals may not be completed on time or on favorable terms. Investments in lower-rated bonds entail higher credit risk.
  • A non-diversified fund may be more susceptible to adverse economic or regulatory developments affecting similar issuers or securities.
  • The risks of investment in foreign securities include currency fluctuations and economic and political uncertainty.
  • These and other risks are described more fully in the fund’s prospectus.

Minimum Investment

$10,000.00

How Financial Advisors Help You

Speak to your financial advisor about whether this fund is appropriate for you. If you don't have a financial advisor, request a referral.

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Important Legal Information

Footnotes

For U.S. residents only.