Two Chou funds to change names, investment strategies in March

By Toni Weeks

San Diego, Dec. 5 - The board of trustees of Chou America Mutual Funds approved the modification of the principal investment strategy and name of the Chou Equity Opportunity Fund and the Chou Income Opportunity Fund, according to a 497 filing with the Securities and Exchange Commission.

The changes were approved on Dec. 1 and will take effect on March 1.

The Chou Equity Opportunity Fund will change its name to the Chou Opportunity Fund. At the same time, it will eliminate its investment policy to invest, under normal circumstances, 80% or more of its net assets in equity securities and other financial instruments that provide exposure to equity securities. Though the fund is likely to continue investing primarily in equity securities, the loosening of the requirement will allow the fund to purchase the most compelling investments at specific price points and hold them a longer time for long-term capital growth, the filing noted.

In addition, the Chou Income Opportunity Fund will change its name to the Chou Income Fund. The fund will expand the types of fixed-income securities that it can invest in to include money market instruments, commercial paper, variable- and floating-rate securities, Rule 144A securities, pay-in-kind securities and loan participation. The fund will continue to invest at least 80% of its net assets in fixed-income securities and financial instruments that provide exposure to fixed-income securities.

The board also said it would waive each fund's 2% redemption fee for fund shares redeemed between Dec. 5 and Feb. 29.

The funds' investment adviser is Toronto-based Chou America Management Inc.

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