MutualFundWire.com: A Texas Fund Firm's Average AUM and Net Outflows Fall

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Wednesday, November 20, 2019

A Texas Fund Firm's Average AUM and Net Outflows Fall

Shareholders redemptions contributed to a 13 percent decrease in average assets under management at a Texas fund firm.

Frank E. Holmes
U.S. Global
CEO, Chief Investment Officer

The team at San Antonio-based U.S. Global Investors released their fiscal Q1 2020 earnings on November 8, 2019, and they had a net loss of $3.6 million for the quarter ending September 30, 2019, which was partly due to a decrease in operating revenue.

Frank Holmes, CEO and CIO of U.S. Global Investors, stated that despite volatility in their investments in the cryptocurrency and artificial intelligence industry through HIVE and GoldSpot, "HIVE reported a healthy first fiscal quarter ended June 30, with positive net income and positive cash flow. HIVE generated net income of $5.6 million" after mining over 1,000 Bitcoin throughout the quarter. Holmes also states that U.S. Global Investors' investment in GoldSpot is doing well thanks to "artificial intelligence (AI) and machine learning geological consulting agreements with Vale S.A., Hochschild Mining and Yamana Gold."

In an earnings call (as transcribed by Seeking Alpha, Holly Schoenfeldt, marketing and public relations manager at U.S. Global Invesetors, stated that "a majority of [U.S. Global Investors Funds'] mutual fund assets are in emerging markets and natural resources, while 32 percent are in domestic equities and fixed income.” Furthermore, more than 75 percent of assets come from retail investors while the rest comes from institutional investors.

U.S. Global Investors' average AUM was $541 million as of the quarter ended September 30, 2019, a 4 percent decrease compared to $564 million as of the quarter ended June 30, 2019 and a 13 percent decrease compared to $624 million as of the quarter ended September 30, 2018. The decrease in AUM was mainly due to net shareholder redemptions totaling $16 million as of the quarter ended September 30, 2019, down 11.6 percent compared to total net shareholder redemptions of $18 million as of the quarter ended September 30, 2018.

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