N-Q 1 wildermuthnq.htm N-Q

united states
securities and exchange commission
washington, d.c. 20549

form n-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY

Investment Company Act File Number 811-22888

 

Wildermuth Endowment Strategy Fund

(Exact name of registrant as specified in charter)

 

11525 Park Woods Circle, Ste. 200, Alpharetta, GA 30005

(Address of principal executive offices) (Zip code)

 

Daniel Wildermuth, President

11525 Park Woods Circle, Ste. 200, Alpharetta, GA 30005

(Name and address of agent for service)

 

Registrant's telephone number, including area code: 678-222-1100

 

Date of fiscal year end: 12/31

 

Date of reporting period: 9/30/15

 

Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to Rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.

 

A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.

 

Item 1. Schedule of Investments.

 

Wildermuth Endowment Strategy Fund      
Schedule of Investments (Unaudited)        
September 30, 2015        
             
Shares            Value
    COMMON STOCK - 15.9 %        
    APPAREL - 0.3 %        
               1,451   Iconix Brand Group, Inc. *        $                    19,617
             
    AUTO PARTS & EQUIPMENT - 0.1 %        
               3,823   SORL Auto Parts, Inc. *                                6,767
             
    BANKS - 0.6 %        
                  257   Capital One Financial Corp.                              18,638
                  319   JPMorgan Chase & Co.                              19,449
                                   38,087
    BIOTECHNOLOGY - 0.9 %        
                    94   Biogen, Inc. *                              27,430
                    69   China Biologic Products, Inc. *                                6,198
                  182   United Therapeutics Corp. *                              23,886
                                   57,514
    CHEMICALS - 0.8 %        
               1,787   Huntsman Corp.                              17,316
                  341   Innospec, Inc.                              15,860
               1,093   Kraton Performance Polymers, Inc. *                              19,565
                                   52,741
    COMMERCIAL SERVICES - 0.5 %        
                  769   On Assignment, Inc. *                              28,376
             
    COMPUTERS - 1.4 %        
                  209   Apple, Inc.                              23,053
                  800   Synaptics, Inc. *                              65,968
                                   89,021
    DIVERSIFIED FINANCIAL SERVICES - 0.6 %      
                  496   Encore Capital Group, Inc. *                              18,352
                  695   World Acceptance Corp. *                              18,654
                                   37,006
    ELECTRIC - 0.7 %        
                  149   Huaneng Power International, Inc. - ADR                                6,303
                  390   Public Service Enterprise Group, Inc.                              16,442
               1,117   Spark Energy, Inc. - Cl. A                              18,486
                                   41,231
    ELECTRONICS - 0.1 %        
               2,341   AU Optronics Corp. - ADR                                6,929
             
    ENTERTAINMENT - 0.1 %        
                  566   Bona Film Group Ltd. - ADR *                                6,741
             
    ENVIRONMENTAL CONTROL - 0.3 %        
                  135   Stericycle, Inc. *                              18,807
             
    FOOD - 0.8 %        
                  494   Tyson Foods, Inc.                              21,291
                  653   United Natural Foods, Inc. *                              31,677
                                   52,968
    HEALTHCARE-PRODUCTS - 0.4 %        
               1,234   Exactech, Inc. *                              21,509
             
Wildermuth Endowment Strategy Fund      
Schedule of Investments (Unaudited) (Continued)      
September 30, 2015        
             
Shares            Value
    COMMON STOCK - 15.9 % (Continued)        
    HEALTHCARE-SERVICES - 0.8 %        
                  195   Chemed Corp.        $                    26,027
                  527   Ensign Group, Inc.                              22,466
                                   48,493
    HOUSEHOLD PRODUCTS/WARES - 0.3 %      
                  236   Helen of Troy Ltd. *                              21,075
             
    INSURANCE - 0.6 %        
                  851   Greenlight Capital Re Ltd. - Cl. A *                              18,960
                  403   MetLife, Inc.                              19,001
                                   37,961
    INTERNET - 0.4 %        
               1,002   eBay, Inc. *                              24,489
             
    LODGING - 0.5 %        
               1,584   Extended Stay America, Inc.                              26,579
                  230   Homeinns Hotel Group *                                6,610
                                   33,189
    MACHINERY-DIVERSIFIED - 0.4 %        
393   Hollysys Automatcion Tech                                6,870
                  122   Roper Technologies, Inc.                              19,117
                                   25,987
    MEDIA - 0.4 %        
                  440   Scripps Networks Interactive, Inc.                              21,644
             
    OIL & GAS - 0.6 %        
                  673   Delek US Holdings, Inc.                              18,642
                  694   Murphy Oil Corp.                              16,795
                    66   Occidental Petroleum Corp.                                4,366
                                   39,803
    OIL & GAS SERVICES - 0.6 %        
               2,902   Gulfmark Offshore, Inc.                              17,731
                  563   National Oilwell Varco, Inc.                              21,197
                                   38,928
    PHARMACEUTICALS - 0.3%        
                  147   USANA Health Sciences, Inc. *                              19,702
             
    RETAIL - 1.0 %        
                  271   Asbury Automotive Group, Inc. *                              21,992
                  273   Target Corp.                              21,474
                  250   Walgreens Boots Alliance, Inc.                              20,775
                                   64,241
    SEMICONDUCTORS - 0.9 %        
                  666   Cabot Microelectronics Corp. *                              25,801
                  996   Cirrus Logic, Inc. *                              31,384
                                   57,185
    SOFTWARE - 0.5 %        
                  337   Changyou.com Ltd. - ADR *                                5,999
                  278   Fiserv, Inc. *                              24,078
                                   30,077
    TELECOMMUNICATIONS - 0.4 %        
                  987   ARRIS Group, Inc. *                              25,632
             
Wildermuth Endowment Strategy Fund      
Schedule of Investments (Unaudited) (Continued)      
September 30, 2015        
             
Shares            Value
    COMMON STOCK - 15.9 % (Continued)        
    TRUCKING & LEASING - 0.6 %        
                    47   AMERCO        $                    19,394
                  604   Greenbrier Cos., Inc.                              18,493
                                   37,887
             
    TOTAL COMMON STOCK (Cost - $1,059,913)                       1,003,607
             
    EXCHANGE TRADED FUNDS - 20.6 %        
    ASSET ALLOCATION FUND - 0.8 %        
               1,100   SPDR Barclays Convertible Securities ETF                              49,192
             
    CLOSED-END FUND - 0.7 %        
               5,399   PIMCO High Income Fund                              40,223
             
    DEBT FUNDS - 6.7 %        
               1,236   iShares Core U.S. Aggregate Bond ETF                            135,441
               1,167   iShares iBoxx $ Investment Grade Corporate Bond ETF                          135,477
                  481   iShares JP Morgan USD Emerging Markets Bond ETF                            51,178
               1,883   PowerShares Emerging Markets Sovereign Debt Portfolio                            51,651
               1,855   SPDR Barclays Short Term High Yield Bond ETF                            49,974
                                 423,721
    EQUITY FUNDS - 12.4 %        
               4,205   ETRACS Alerian MLP Infrastructure Index ETN                          113,787
               8,248   Global X MLP ETF                              89,243
               1,404   iShares MSCI Australia ETF                              25,160
               1,708   iShares MSCI Austria Capped ETF                              25,579
                  955   iShares MSCI Chile Capped ETF                              31,477
                  544   iShares MSCI EAFE Small-Cap ETF                              25,987
               1,013   iShares MSCI Frontier 100 ETF                              25,467
               1,023   iShares MSCI Germany ETF                              25,309
               1,359   iShares MSCI Hong Kong ETF                              25,984
               1,011   iShares MSCI India ETF                              28,884
               3,245   iShares MSCI Malaysia ETF                              32,158
               1,091   iShares MSCI Netherlands ETF                              25,529
                  801   iShares MSCI New Zealand Capped ETF                              25,616
                  755   iShares MSCI Philippines ETF                              25,965
               2,495   iShares MSCI Singapore ETF                              25,374
                  890   iShares MSCI Sweden ETF                              25,837
               2,090   iShares MSCI Taiwan ETF                              27,504
                  465   iShares MSCI Thailand Capped ETF                              28,951
                  286   iShares MSCI Turkey ETF                              10,450
                  649   iShares MSCI United Kingdom Small-Cap ETF                            25,668
               3,718   JPMorgan Alerian MLP Index ETN                            112,990
                                 782,919
             
    TOTAL EXCHANGE TRADED FUNDS (Cost - $1,442,012)                       1,296,055
             
    LIMITED PARTNERSHIPS - 6.8 %        
                      2   GPB Automotive Portfolio LP + #                            100,000
           275,000   Semper Midas Fund LP + #                            273,681
                    56   Shopoff Land Fund III LP + #                              50,680
                  250   Uniprop Manufactured Housing Communities LP + #                              2,233
    TOTAL LIMITED PARTNERSHIPS (Cost - $427,752)                          426,594
             
Wildermuth Endowment Strategy Fund      
Schedule of Investments (Unaudited) (Continued)      
September 30, 2015        
             
Shares            Value
    PUBLIC NON-TRADED REAL ESTATE INVESTMENT TRUSTS - 19.3 %    
    REAL ESTATE - 19.3 %        
             50,478   Behringer Harvard Opportunity REIT I, Inc. + #      $                  180,709
             32,369   CNL Lifestyle Properties, Inc. + #                            168,318
             18,440   Cottonwood Residential, Inc. + #                            267,564
             18,060   Dividend Capital Diversified Property Fund + #                          134,190
             51,447   Inventrust Properties Corp. + #                            205,787
             42,196   KBS REIT I, Inc. + #                            190,726
               1,000   Landmark Apartment Trust, Inc. + #                                8,150
               4,037   TIER REIT, Inc. + #                              59,425
    TOTAL PUBLIC NON-TRADED REAL ESTATE INVESTMENT TRUSTS (Cost - $996,881)                   1,214,869
             
    SHORT-TERM INVESTMENTS - 38.7 %        
        2,433,738   Blackrock Liquidity Funds T-Fund Portfolio, 0.01 % ^      
    TOTAL SHORT-TERM INVESTMENTS (Cost - $2,433,738)                       2,433,738
             
    TOTAL INVESTMENTS - 101.3 % (Cost - $6,330,296) (a)      $               6,374,863
    OTHER LIABILITIES LESS ASSETS - (1.3) %                          (80,322)
    NET ASSETS - 100.0 %        $               6,294,541
             
^ Rate shown represents the rate at September 30, 2015, is subject to change and resets daily.      
+ Illiquid security. Total illiquid securities represent 26.1% of net assets as of September 30, 2015.    
# Market Value estimated using Fair Valuation Procedures adopted by the Board of Trustees. Total of such securities is $1,641,463, or 26.1 %, of net assets.
ADR - American Depositary Receipt        
LP - Limited Partnership        
REIT - Real Estate Investment Trust        
(a) Represents cost for financial reporting purposes. Aggregate cost for federal income tax purposes is $6,330,296 and differs from market value by net unrealized appreciation (depreciation) of securities as follows:
           Unrealized appreciation:  $                  271,238
           Unrealized depreciation:                    (226,671)
           Net unrealized appreciation:  $                    44,567

 

 

 

 

Wildermuth Endowment Strategy Fund
Notes to Schedule of Investments (Unaudited)
September 30, 2015
 
The following is a summary of significant accounting policies followed by the Fund and are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).  
 
Security Valuation – Securities listed on an exchange are valued at the last reported sale price at the close of the regular trading session of the exchange on the business day the value is being determined, or in the case of securities listed on NASDAQ at the NASDAQ Official Closing Price (“NOCP”).  In the absence of a sale such securities shall be valued at the mean of the closing bid and asked prices for the day of valuation.
 
When price quotations for certain securities are not readily available, or if the available quotations are not believed to be reflective of market value by the Adviser, those securities will be valued at “fair value” as determined in good faith by Wildermuth Advisory, LLC's, the Fund's investment adviser (the "Adviser"), fair value team using procedures adopted by and under the supervision of the Fund’s Board of Trustees (the “Board”). There can be no assurance that the Fund could purchase or sell a portfolio security at the price used to calculate the Fund’s NAV.
 
Investment Funds that are Private Funds and Non-Traded REITs (“Non-Traded Funds”) will be difficult to value, particularly to the extent that their underlying investments are not publicly traded. In the event a Non-Traded Fund does not report a value to the Fund on a timely basis, the Adviser, acting under the Board’s supervision and pursuant to policies implemented by the Board, will determine the fair value of the Fund’s investment based on the most recent value reported by the Non-Traded Fund, as well as any other relevant information available at the time the Fund values its investments. Following procedures adopted by the Board, in the absence of specific transaction activity in a particular investment fund, the Adviser will consider whether it is appropriate, in light of all relevant circumstance, to value the Fund’s investment at NAV reported by the Non-Traded Fund at the time of valuation or to adjust the value to reflect a premium or discount.
 
There is no single standard for determining fair value of a security. Rather, the Adviser’s fair value calculations will involve significant professional judgment in the application of both observable and unobservable attributes, and as a result, the calculated net asset values of the Non-Traded Funds’ assets may differ from their actual realizable value or future fair value. In determining the fair value of a security for which there are no readily available market quotations, the Adviser, acting under the Board’s supervision and pursuant to policies implemented by the Board, may consider several factors, including, but not limited to: (i) the nature and pricing history (if any) of the security; (ii) whether any dealer quotations for the security are available; (iii) possible valuation methodologies that could be used to determine the fair value of the security; (iv) the recommendation of the portfolio manager of the Fund with respect to the valuation of the security; (v) whether the same or similar securities are held by other accounts managed by the Adviser and the method used to price the security in those accounts; (vi) the extent to which the fair value to be determined for the security will result from the use of data or formula produced by third parties independent of the Adviser; and (vii) the liquidity or illiquidity of the market for the security. As part of its due diligence of Non-Traded Fund investments, the Adviser will attempt to obtain current information on an ongoing basis from market sources, asset managers and/or issuers to value all fair valued securities. However, it is anticipated that portfolio holdings and other value information of the Non-Traded Funds could be available on no more than a quarterly basis. Based on its review of all relevant information, the Adviser may conclude in certain circumstances that the information provided by the asset manager and/or issuer of a Non-Traded Fund does not represent the fair value of the Fund’s investment in such security. Private Funds that invest primarily in publicly traded securities are more easily valued because the values of their underlying investments are based on market quotations.
 
The Fund utilizes various methods to measure the fair value of most of its investments on a recurring basis.  GAAP establishes a hierarchy that prioritizes inputs to valuation methods. The three levels of input are:
 
Level 1 – Unadjusted quoted prices in active markets for identical assets and liabilities that the Fund has the ability to access.
Level 2 – Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.  These inputs may include quoted prices for the identical instrument in an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
Level 3 – Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund's own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.
 
The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment.  Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.
 
The inputs used to measure fair value may fall into different levels of the fair value hierarchy.  In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
 
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
 
The following is a summary of the valuation inputs, representing 100% of the Fund's investments, used to value the Fund's assets and liabilities as of September 30, 2015:

 

               
Assets Level 1   Level 2   Level 3   Total
Common Stock  $        1,003,607    $                         -    $                         -    $        1,003,607
Exchange Traded Funds             1,296,055                                -                                -               1,296,055
Limited Partnerships                              -                                -                  426,594                  426,594
Public Non-Traded Real Estate Investment Trusts                              -                                -               1,214,869               1,214,869
Short-Term Investments             2,433,738                                -                                -               2,433,738
Total Assets  $        4,733,400    $                         -    $        1,641,463    $        6,374,863

 

There were no transfers into or out of Level 1 and Level 2 during the current period presented.  It is the Fund's policy to record transfers into or out of Level 1 and Level 2 at the end of the period.

 

The following is a reconciliation of assets in which Level 3 inputs were used in determining value:

 

       
  Limited   Public Non-Traded
  Partnership   REIT
Beginning Balance  $                       -       $                       -   
Total realized gain/(loss)                            -                                   -
Appreciation/(depreciation)                   (1,158)                  217,988
Cost of Purchases                427,752                  996,881
Proceeds from Sales & Return of Capital                            -                                   -
Accrued Interest                            -                                   -
Net transfers in/out of Level 3                            -                                   -
Ending Balance  $            426,594    $        1,214,869
       

 

Item 2. Controls and Procedures.

 

(a) The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended.

 

(b) There were no significant changes in the registrant’s internal control over financial reporting that occurred during the registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

Item 3. Exhibits.

 

Certifications required by Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) (and Item 3 of Form N-Q) are filed herewith.

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Wildermuth Endowment Strategy Fund

 

By

/s/ Daniel Wildermuth

Daniel Wildermuth, Trustee, Chairman of the Board, President and Chief Executive Officer

 

Date 11/30/15

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By

/s/ Daniel Wildermuth

Daniel Wildermuth, Trustee, Chairman of the Board, President and Chief Executive Officer

 

Date 11/30/15

 

By

/s/ Gerard Scarpati

Gerard Scarpati, Treasurer and Chief Financial Officer

 

Date 11/30/15