SEC Company Response from BLUE CHIP INVESTOR FUNDS (CIK 0001162127) — Apr 28, 2022
BLUE CHIP INVESTOR FUNDS (CIK 0001162127)
Date: April 28, 2022 · CIK: 0001162127 · Accession: 0001413042-22-000391
AI Filing Summary & Sentiment
File numbers found in text: 333-73104, 811-10571
Letter
Division of Investment Management, Disclosure Review and Accounting Office F. Street, N.E. Washington, DC 20549 Re: Blue Chip Investor Funds (the "Trust”); File Nos. 811-10571 and 333-73104
Dear Mr. Ellington:
Please find below the Trust’s responses to oral comments from the staff received on April 4, 2022 on the Trust's Annual Report to Shareholders for the period ended December 31, 2021 (the "Report") related to the Blue Chip Investor Fund (the “Fund”). For your convenience, I have summarized the staff’s comments.
1. Comment: The sum of the total individual holdings that are over 5% appears to exceed 50% of the total assets. Please confirm that the fund is in compliance with IRS diversification rules for tax purposes.
Response: The Fund is in compliance with IRS diversification rules for tax purposes.
2. Comment: Please update item 4D in the N-CSR Certification to remove the reference to “second fiscal quarter” and file and amended N-CSR.
Response: The Registrant will update item 4D in the N-CSR Certification and file and amended N-CSR.
3. Comment: The Staff noted a significant ownership of the Fund in one account. Please explain how large shareholder risk is disclosed in the prospectus.
Response: We have reviewed the makeup of the Fund’s shareholders and the liquidity of the portfolio and do not believe any additional disclosure is necessary in the prospectus.
4. Comment: The Staff noted a significant percentage of Fund in Berkshire Hathaway. The most recent prospectus does not have a principal risk for investing in Berkshire Hathaway. Please explain why.
Response: The Registrant notes that the “Risk of Non-Diversification” is presently disclosed as “The Fund is non-diversified, which means that it has the ability to take larger positions in a smaller number of securities than a portfolio that is “diversified.” Non-diversification increases the risk that the value of the Fund could go down because of the poor performance of a single investment,” which the Registrant believes captures the risk of an investment such as Berkshire Hathaway. Furthermore, the Registrant notes that a specific reference to Berkshire Hathaway would be rendered irrelevant and misleading if the investment were sold. Berkshire Hathaway shares have appreciated significantly since their purchase more than fifteen years ago. Additionally, Berkshire Hathaway is a diversified holding company.
__________________________________
If you have any questions or additional comments, please call the undersigned at 619-588-9700.
Respectfully,
/s/Jeffrey Provence
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CORRESP
1
filename1.htm
Blue
Chip Investor Funds
April
28, 2022
Ken
Ellington
Staff
Accountant
U.S.
Securities and Exchange Commission
Division
of Investment Management, Disclosure Review and Accounting Office
100
F. Street, N.E.
Washington,
DC 20549
Re: Blue
Chip Investor Funds (the "Trust”); File Nos. 811-10571 and 333-73104
Dear
Mr. Ellington:
Please
find below the Trust’s responses to oral comments from the staff received on April 4, 2022 on the Trust's Annual Report to Shareholders
for the period ended December 31, 2021 (the "Report") related to the Blue Chip Investor Fund (the “Fund”). For
your convenience, I have summarized the staff’s comments.
1. Comment:
The sum of the total individual holdings that are over 5% appears to exceed 50% of the total assets. Please confirm that the fund is
in compliance with IRS diversification rules for tax purposes.
Response:
The Fund is in compliance with IRS diversification rules for tax purposes.
2. Comment:
Please update item 4D in the N-CSR Certification to remove the reference to “second fiscal quarter” and file and amended
N-CSR.
Response:
The Registrant will update item 4D in the N-CSR Certification and file and amended N-CSR.
3. Comment:
The Staff noted a significant ownership of the Fund in one account. Please explain how large shareholder risk is disclosed in the prospectus.
Response:
We have reviewed the makeup of the Fund’s shareholders and the liquidity of the portfolio and do not believe any additional disclosure
is necessary in the prospectus.
4. Comment:
The Staff noted a significant percentage of Fund in Berkshire Hathaway. The most recent prospectus does not have a principal risk for
investing in Berkshire Hathaway. Please explain why.
Response:
The Registrant notes that the “Risk of Non-Diversification” is presently disclosed as “The Fund is non-diversified,
which means that it has the ability to take larger positions in a smaller number of securities than a portfolio that is “diversified.”
Non-diversification increases the risk that the value of the Fund could go down because of the poor performance of a single investment,”
which the Registrant believes captures the risk of an investment such as Berkshire Hathaway. Furthermore, the Registrant notes that a
specific reference to Berkshire Hathaway would be rendered irrelevant and misleading if the investment were sold. Berkshire Hathaway
shares have appreciated significantly since their purchase more than fifteen years ago. Additionally, Berkshire Hathaway is a diversified
holding company.
__________________________________
If
you have any questions or additional comments, please call the undersigned at 619-588-9700.
Respectfully,
/s/Jeffrey Provence
Jeffrey
Provence
Treasurer,
Blue Chip Investor Funds