N-Q 1 franknq.htm SEC FILING

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549



FORM N-Q


QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

 MANAGEMENT INVESTMENT COMPANY


Investment Company Act file number: 811-21532


Frank Funds

(Exact Name of Registrant as Specified in Charter)


312 East 22nd Street, #2B, New York, NY  10010

 (Address of Principal Executive Offices)  (Zip Code)


Brian J. Frank, Frank Capital Partners LLC

312 East 22nd Street, #2B, New York, NY  10010

 (Name and Address of Agent for Service)


With copy to:

JoAnn M. Strasser, Thompson Hine LLP

312 Walnut Street, 14th Floor, Cincinnati, Ohio  45202


Registrant’s Telephone Number, including Area Code:  973-887-7698


Date of fiscal year end: June 30


Date of reporting period: September 30, 2009


Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (ss.ss. 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 the Secretary, Securities and Exchange Commission, and 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. ss. 3507.


ITEM 1. SCHEDULE OF INVESTMENTS.

       

Frank Value Fund

 

Schedule of Investments

 

September 30, 2009 (Unaudited)

 
       

Shares

    

Value

 
       

COMMON STOCKS - 94.82%

    
       

Commercial Banks, NEC - 0.14%

    

516

 

Citigroup, Inc. *

  

$           2,497

 
       

Communications Equipment - 3.06%

    

10,882

 

Lojack Corp. *

  

55,389

 
       

Computer Communications Equipment - 5.70%

    

4,386

 

Cisco Systems, Inc. *

  

103,246

 
       

Concrete, Gypsum & Plaster Products - 1.32%

    

1,388

 

USG Corp. *

  

23,846

 
       

Electronic Computers - 2.79%

    

3,313

 

Dell, Inc. *

  

50,556

 
       

Finance Services - 2.58%

    

2,959

 

Americredit Corp. *

  

46,723

 
       

Fire, Marine & Casualty Insurance - 1.65%

    

9

 

Berkshire Hathaway, Inc. - Class B *

  

29,907

 
       

Hospital & Medical Service Plans - 12.72%

    

1,377

 

Humana, Inc. *

  

51,362

 

5,430

 

Wellcare Health Plans, Inc. *

  

133,849

 

952

 

Wellpoint, Inc. *

  

           45,087

 
     

230,298

 

Men's & Boy's Furnishings, Work Clothing & Allied Garments - 2.40%

   

1,435

 

Cintas Corp. *

  

43,495

 
       

Miscellaneous Furniture & Fixtures - 1.48%

    

2,569

 

Knoll, Inc.

  

26,795

 
       

Perfumes, Cosmetics & Other Toliet Preparations - 3.76%

    

5,732

 

Bare Escentuals, Inc. *

  

68,153

 
       

Pharmaceutical Preparations - 17.53%

    

3,052

 

Forest Laboratories, Inc. - Class A *

  

89,851

 

1,590

 

NBTY, Inc. *

  

62,932

 

7,886

 

Pfizer, Inc.

  

130,513

 

4,855

 

Prestige Brands Holdings, Inc. *

  

           34,179

 
     

317,475

 

Retail-Computer & Computer Software - 3.55%

    

2,431

 

Gamestop Corp. *

  

64,349

 
       

Retail-Drug Store and Proprietary Stores - 5.20%

    

4,997

 

Petmed Express, Inc.

  

94,193

 
       

Retail-Radio, TV & Consumer Electronics Stores - 2.61%

    

1,259

 

Best Buy Co., Inc.

  

47,238

 
       

Services-Advertising Agencies - 3.28%

    

4,504

 

Valueclick, Inc. *

  

59,408

 
       

Services-Business Services - 8.29%

    

8,771

 

Bidz.com *

  

30,523

 

3,325

 

Ebay, Inc. *

  

78,470

 

2,174

 

Western Union Co. *

  

           41,132

 
     

150,125

 

Services-Computer Programming - 2.29%

    

4,923

 

Pros Holdings, Inc. *

  

41,452

 
       

Services-Consumer Credit Reporting - 1.24%

    

1098

 

Moody's Corp.

  

22,465

 
       

Services-Mailing, Reproduction - 2.76%

    

5,250

 

American Reprographics Co. *

  

49,980

 
       

Services-Management Consulting - 2.20%

    

1,603

 

Corporate Executive Board Co.

  

39,915

 
       

Services-Prepackaged Software - 3.48%

    

2,448

 

Microsoft Corp.

  

62,963

 
       

Telegraph & Other Message Communications - 4.79%

    

3,759

 

J2 Global Communications, Inc. *

  

           86,495

 
       

TOTAL FOR COMMON STOCKS (Cost $1,635,315) - 94.82%

  

$     1,716,963

 
       

SHORT TERM INVESTMENTS - 6.10%

    

110,537

 

First American Treasury Obligations Fund Class Y

  

         110,537

 
  

    0.00% ** (Cost $110,537)

    
       

TOTAL INVESTMENTS (Cost $1,745,852) - 100.92%

  

$     1,827,500

 
       

LIABILITIES IN EXCESS OF OTHER ASSETS - (0.92)%

  

        (16,695)

 
       

NET ASSETS - 100.00%

  

$     1,810,805

 
       

* Non-income producing securities during the period.

    

** Variable rate security; the coupon rate shown represents the yield at September 30, 2009.

   
       

NOTES TO FINANCIAL STATEMENTS

    

Frank Value Fund

    

1. SECURITY TRANSACTIONS

    

At September 30, 2009, the net unrealized appreciation on investments, based on cost for federal income tax purposes of $1,745,852 amounted to $81,648, which consisted of aggregate gross unrealized appreciation of $224,305 and aggregate gross unrealized depreciation of $142,657.

       

2. SECURITY VALUATION

    

Equity securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the adviser believes such prices accurately reflect the fair market value of such securities.  Securities that are      
traded on any stock exchange or on the NASDAQ over-the-counter market are generally valued by the pricing service at the last quoted sale price.  Lacking a last sale price, an equity security is generally valued by the pricing service at its last bid price.  When market quotations are not readily available, when the adviser determines that the market quotation or the price provided by the pricing service does not accurately reflect the current market value, or when restricted or illiquid securities are being valued, such securities are valued as determined in good faith by the adviser, in conformity with guidelines adopted by and subject to review by the Board of Trustees.

       

Fixed income securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the adviser believes such prices accurately reflect the fair market value of such securities.  A pricing service utilizes electronic data processing techniques based on yield spreads relating to securities with similar characteristics to determine prices for normal institutional-size trading units of debt securities without regard to sale or bid prices.  If the adviser decides that a price provided by the pricing service does not accurately reflect the fair market value of the securities, when prices are not readily available from a pricing service, or when restricted or illiquid securities are being valued, securities are valued at fair value as determined in good faith by the adviser, in conformity with guidelines adopted by and subject to review of the Board of Trustees.  Short term investments in fixed income securities with maturities of less than 60 days when acquired, or which subsequently are within 60 days of maturity, are valued by using the amortized cost method of valuation, which the Board has determined will represent fair value.

       

In accordance with the Trust’s good faith pricing guidelines, the adviser is required to consider all appropriate factors relevant to the value of securities for which it has determined other pricing sources are not available or reliable as described above.  No single standard for determining fair value exists since fair value depends upon the circumstances of each individual case.  As a general principle, the current fair value of an issue of securities being valued by the adviser would appear to be the amount which the owner might reasonably expect to receive for them upon their current sale.  Methods which are in accord with this principle may, for example, be based on (i) a multiple of earnings; (ii) a discount from market of a similar freely traded security (including a derivative security or a basket of securities traded on other markets, exchanges or among dealers); or (iii) yield to maturity with respect to debt issues, or a combination of these and other methods.

       

In accordance with FAS 157, fair value is defined as the price that the Funds would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. FAS 157 also establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency  of  inputs  to  the valuation of an asset or liability.  The three-tier hierarchy of inputs is summarized below:

       

Valuation Inputs of Assets

Level 1

Level 2

Level 3

Total

Common Stock

$1,716,963

              $0

              $0

$1,716,963

Exchange Traded Funds

              $0

              $0

              $0

              $0

Convertible Bonds

              $0

              $0

              $0

              $0

Cash Equivalents

$110,537

              $0

              $0

$110,537

Total

  

$1,716,963

       $0

       $0

$1,716,963

    

 

 

 

Leigh Baldwin Total Return Fund

Schedule of Investments

September 30, 2009 (Unaudited)

       

Shares

     

Value

       

COMMON STOCKS - 71.78%

    
       

Beverages - 8.78%

    

1,900

 

Coca Cola Co.

   

$       102,030

1,200

 

Diageo

   

           73,788

      

175,818

Cigarettes - 4.00%

    

4,500

 

Altria Group

   

80,145

       

Farm Machinery & Equipment - 1.27%

    

5,000

 

Arts Way Manufacturing Co. *

   

25,350

       

Finance Services - 1.27%

    

3,000

 

Oneida Financial Corp.

   

25,530

       

Food & Kindred Products - 3.67%

    

2,800

 

Kraft Foods, Inc.

   

73,556

       

Grain Mill Products - 3.69%

    

1,500

 

Kellogg Co.

   

73,845

       

National Commercial Banks - 1.12%

    

1,000

 

NBT Bancorp

   

22,540

       

Natural Gas Distribution - 1.83%

    

1,000

 

Nicor, Inc.

   

36,590

       

Petroleum Refining - 8.67%

    

1,200

 

Chevron Corp.

   

84,516

1,300

 

Exxon Mobil Corp.

   

             89,193

      

173,709

Pharmaceutical Preparations - 1.12%

    

1,000

 

Bristol Myers Squibb Co.

   

22,520

       

Real Estate Investment Trusts - 3.89%

    

4,300

 

Annaly Capital Management, Inc.

   

78,002

       

Retail-Eating Places - 5.13%

    

1,800

 

McDonald's Corp.

   

102,726

       

Search, Detection, Navigation, Guidance, Aeronautical Systems  - 4.65%

   

1,800

 

Northrup Grumman Corp.

   

93,150

       

Security Brokers, Dealers & Flotation Companies - 4.78%

    

5,000

 

Charles Schwab & Co., Inc.

   

95,750

       

Semiconductors & Related Devices - 3.91%

    

4,000

 

Intel Corp.

   

78,280

       

Services-Miscellaneous Amusement & Recreation - 1.29%

    

1,000

 

Disney Corts

   

25,750

       

Telephone Communications - 6.22%

    

3,500

 

AT&T Corp. *

   

94,535

4,000

 

Frontier Communications Corp.

   

             30,160

      

124,695

Trucking & Courier Services - 3.38%

    

1,200

 

United Parcel Services, Inc.

   

67,764

       

Water Supply - 1.76%

    

2,000

 

Aqua America, Inc.

   

35,280

       

Wholesale-Farm Product Raw Materials - 1.35%

    

1,000

 

CHS, Inc.

   

             27,120

       

TOTAL FOR COMMON STOCKS (Cost $1,375,750) - 71.78%

   

$    1,438,120

       

EXCHANGE TRADED FUNDS - 9.16%

    

5,000

 

Aberdeen Asia Pacific Fund

   

$         30,950

2,000

 

The Gabelli Global Gold, Natural Resources & Income Trust

  

30,960

2,000

 

Powershares Commodity Index Fund *

   

44,120

1,000

 

Proshares Ultra Short *

   

40,390

4,000

 

Templeton Global Income Fund

   

           37,200

       

TOTAL FOR EXCHANGE TRADED FUNDS (Cost $188,041) - 9.16%

   

$       183,620

       

 PUT OPTIONS

    
       

Shares Subject

 

Underlying Security

    

to Put

 

Expiration Date/Exercise Price

    
       
  

Altria Group, Inc.

    

4,500

 

 January 2011 Put @ 12.50

   

$           2,565

       
  

Annaly Capital Management, Inc.

    

4,500

 

January 2011 Put @ 10.00

   

             2,340

       
  

AT&T Corp.

    

3,500

 

January 2011 Put @ 20.00

   

             5,180

       
  

Chevron Corp.

    

800

 

January 2011 Put @ 60.00

   

             4,560

       
  

Coca Cola Co.

    

1,500

 

January 2011 Put @ 37.50

   

             1,575

       
  

Diageo Plc

    

1,200

 

January 2011 Put @ 50.00

   

             4,080

       
  

Exxon Mobil Corp.

    

1,000

 

January 2011 Put @ 55.00

   

             3,800

       
  

Frontier Communications Corp.

    

4,000

 

February 2010 Put @ 2.50

   

                    0

       
  

Intel Corp.

    

4,000

 

January 2011 Put @ 12.50

   

             2,720

       
  

Kellogg Co.

    

1,500

 

January 2011 Put @ 35.00

   

             1,350

       
  

Kraft Foods, Inc.

    

2,800

 

January 2011 Put @ 20.00

   

             3,192

       
  

McDonald's Corp.

    

1,500

 

January 2011 Put @ 45.00

   

             3,525

       
  

Merck & Co., Inc.

    

3,000

 

January 2011 Put @ 20.00

   

             3,150

       
  

Nike, Inc.

    

1,000

 

January 2011 Put @ 35.00

   

             1,050

       
  

Northrup Grumman Corp.

    

1,800

 

January 2011 Put @ 40.00

   

             3,870

       
  

Novartis Ag

    

1,800

 

January 2011 Put @ 35.00

   

             1,260

       
  

Charles Schwab & Co., Inc.

    

4,500

 

January 2011 Put @ 12.50

   

             3,375

       
  

United Parcel Service, Inc.

    

1,200

 

January 2011 Put @ 45.00

   

             3,840

       
  

TOTAL (Premiums Paid $125,412) - 2.57%

   

$         51,432

       

SHORT TERM INVESTMENTS - 19.21%

    

384,880

 

Fidelity Governmental Fund 57, 0.19%** (Cost $384,880)

   

         384,880

       

TOTAL INVESTMENTS (Cost $1,689,203) - 102.72%

   

$    2,058,052

       

LIABILITIES IN EXCESS OF OTHER ASSETS - (2.72%)

   

         (54,484)

       

NET ASSETS - 100.00%

   

$    2,003,568

       

* Non-income producing securities during the period.

    

** Variable rate security; the coupon rate shown represents the yield at September 30, 2009.

   
       

Leigh Baldwin Total Return Fund

Schedule of Options Written

September 30, 2009 (Unaudited)

       
  

CALL OPTIONS WRITTEN

    
       

Shares Subject

 

Underlying Security

    

to Call

 

Expiration Date/Exercise Price

   

Value

       
  

Altria Group, Inc.

    

4,500

 

 October 2009 Call @ 18.00

   

$              855

       
  

Annaly Capital Management, Inc.

    

4,300

 

 November 2009 Call @ 19.00

   

               1,505

       
  

Aqua America, Inc.

    

2,000

 

 November 2009 Call @ 17.50

   

               1,100

       
  

AT&T Corp.

    

3,000

 

 October 2009 Call @ 26.00

   

3,150

500

 

 October 2009 Call @ 27.00

   

                  200

      

               3,350

  

Bristol Meyers Squibb Co.

    

1,000

 

 November 2009 Call @ 22.00

   

               1,110

       
  

Chevron Corp.

    

1,200

 

 October 2009 Call @ 70.00

   

               1,920

       
  

Coca Cola Co.

    

1,900

 

 October 2009 Call @ 50.00

   

               7,220

       
  

Diageo Plc

    

1,200

 

 October 2009 Call @ 65.00

   

                  300

       
  

Exxon Mobil Corp.

    

1,300

 

 October 2009 Call @ 70.00

   

                  832

       
  

Frontier Communications Corp.

    

4,000

 

 February 2010 Call @ 17.50

   

               2,000

       
  

Intel Corp.

    

4,000

 

 October 2009 Call @ 19.00

   

               3,760

       
  

Kellogg Co.

    

1,500

 

 October 2009 Call @ 45.00

   

               6,300

       
  

Kraft Food, Inc.

    

2,800

 

 December 2009 Call @ 26.00

   

               3,500

       
  

McDonald's Corp.

    

1,800

 

 October 2009 Call @ 57.50

   

               1,224

       
  

NBT Bankcorp

    

1,000

 

 October 2009 Call @ 22.50

   

                  850

       
  

Nicor, Inc.

    

1,000

 

 January 2010 Call @ 35.00

   

               2,900

       
  

Northrup Grumman Corp.

    

1,800

 

 October 2009 Call @ 50.00

   

               4,500

       
  

Powershares DB Commodity

    

2,000

 

 October 2009 Call @ 22.00

   

               1,000

       
  

Proshares Ultrashort S&P 500

    

1,000

 

 October 2009 Call @ 44.00

   

                  600

       
  

Charles Schwab & Co., Inc.

    

5,000

 

 October 2009 Call @ 18.00

   

               7,000

       
  

United Parcel Service, Inc.

    

1,200

 

 October 2009 Call @ 55.00

   

               2,700

       
  

Total (Premiums Received $51,997)

   

$         54,526

       

NOTES TO FINANCIAL STATEMENTS

    

Leigh Baldwin Total Retrun Fund

    

1. SECURITY TRANSACTIONS

    

At September 30, 2009, the net unrealized depreciation on investments, based on cost for federal income tax purposes of $1,689,203 amounted to $18,560, which consisted of aggregate gross unrealized appreciation of $102,475 and aggregate gross unrealized depreciation of $121,035.

       

2. SECURITY VALUATION

    

Equity securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the adviser believes such prices accurately reflect the fair market value of such securities.  Securities that are traded on any stock exchange or on the NASDAQ over-the-counter market are generally valued by the pricing service at the last quoted sale price.  Lacking a last sale price, an equity security is generally valued by the pricing service at its last bid price.  When market quotations are not readily available, when the adviser determines that the market quotation or the price provided by the pricing service does not accurately reflect the current market value, or when restricted or illiquid securities are being valued, such securities are valued as determined in good faith by the adviser, in conformity with guidelines adopted by and subject to review by the Board of Trustees.

       

Fixed income securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the adviser believes such prices accurately reflect the fair market value of such securities.  A pricing service utilizes electronic data processing techniques based on yield spreads relating to securities with similar characteristics to determine prices for normal institutional-size trading units of debt securities without regard to sale or bid prices.  If the adviser decides that a price provided by the pricing service does not accurately reflect the fair market value of the securities, when prices are not readily available from a pricing service, or when restricted or illiquid securities are being valued, securities are valued at fair value as determined in good faith by the adviser, in conformity with guidelines adopted by and subject to review of the Board of Trustees.  Short term investments in fixed income securities with maturities of less than 60 days when acquired, or which subsequently are within 60 days of maturity, are valued by using the amortized cost method of valuation, which the Board has determined will represent fair value.     

In accordance with FAS 157, fair value is defined as the price that the Funds would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. FAS 157 also establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency  of  inputs  to  the valuation of an asset or liability.  The three-tier hierarchy of inputs is summarized below:

       

Valuation Inputs of Assets

Level 1

Level 2

Level 3

Total

Common Stock

$1,438,120

              $0

              $0

$1,438,120

Exchange Traded Funds

$183,620

              $0

              $0

$183,620

Options Purchased

$0

$51,432

              $0

$51,432

Cash Equivalents

$384,880

              $0

              $0

$384,880

Total

  

$2,006,620

$51,432

       $0

$2,058,052

       
       

Valuation Inputs of Liabilities

Level 1

Level 2

Level 3

Total

Options Written

$0

$54,526

$0

$54,526

Total

  

$0

$54,526

       $0

$54,526



ITEM 2. CONTROLS AND PROCEDURES.


(a)

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Registrant maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Registrant's filings under the Securities Exchange Act of 1934 and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant's management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant's management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Within 90 days prior to the filing date of this Quarterly Schedule of Portfolio Holdings on Form N-Q, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant's management, including the Registrant's principal executive officer and the Registrant's principal financial officer, of the effectiveness of the design and operation of the Registrant's disclosure controls and procedures. Based on such evaluation, the Registrant's principal executive officer and principal financial officer concluded that the Registrant's disclosure controls and procedures are effective.

(b)

CHANGES IN INTERNAL CONTROLS. There have been no significant changes in the Registrant's internal controls or in other factors that could significantly affect the internal controls subsequent to the date of their evaluation in connection with the preparation of this Quarterly Schedule of Portfolio Holdings on Form N-Q.


ITEM 3. EXHIBITS.


Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.


SIGNATURES


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.


Frank Funds


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/Brian J. Frank

Brian J. Frank

President and Treasurer


Date November 18, 2009