"BigTom">RCRIX has a small AUM. I wouldn’t be comfortable knowing the top 10 securities make up 49% of the portfolio in floating rate space (75% in junk) but that’s just me..
BigTom, very understandable. The category of Bank Loan/Floating Rate is basically a subsector, of the broader HY Junk Bond category. For an investor, especially a conservative bond oef investor, to be willing to invest in junk bonds, is an important question that each investor should answer. The Bank Loan/Floating rate bond oef, that I would most likely invest in, is MWFRX/MWFLX. It is from a stable of bond oefs, offered by Met West, and it has an established history of being managed very conservatively, at least "conservative" for a sector HY bond category.
RCRIX/RCRFX is from a smaller investment company, but a company that has offered some very good bond oefs, with a very conservative approach to investing. But on a confidence/comfort level, many investors will choose to only invest in a larger fund, from a more well known company.
I offered this topic to just offer a topic of discussion for a category of bond oefs, that has been around for many years. In general Bank Loan/Floating Rate funds, are considered a bit more conservative way of investing in junk bonds, at least from my experience. Of course some Bank Loan/Floating Rate bond oefs can vary greatly in risk, with many having much higher volatility, much worse performance in downmarkets, and focusing on much riskier types of bank loan assets.

Thanks, John.
Inflation (Consumer Price Index) was up 2.1% in 2019 as of last November, so it's not surprising that IRA contributions would remain the same for 2020. Some years (in fact most years) I struggle to find the max to contribute anyway!
IRA contribution limits last increased by $500 for tax year 2019. With inflation so low I wouldn't bank on another increase for 2021. The increase for 2019 was the first since 2013.

FWIW, Schwab lists PONAX with a net exp ratio of 1.45% It also shows it has a 12b-1 expense of .25%. So I have know idea what you would end up paying. But, I haven't owned it for a few years so don't care.

PONAX exp ratio is 1.45%. This includes 12b-1 fees, management fees, administrative fees, operating costs, and all other asset-based costs incurred by the fund.
It doesn't include transaction costs as a result of trading of the fund's assets but this is very small.
The most important is the fact that performance is after all costs and risk attributes (SD=volatility, Max Draw, Sharpe, Sortino...) are correct too.

I'd thought I make a second comment about this months edition of Dr. Madell's newsletter.
I find it interesting that Dr. Madell chose five year periods for his study to determine what the next five years might offer investors. This is because I use a rolling five year period to determine what my portfolio's distributions will be. What I do is take (up to) a sum equal to what one half of my five year aveage returns have been as a retirement distribution and I have also found that principal grows over time by leaving the other half for capital formation. This is the way I ran my parents money years back (when they were retired) and it worked well for them growing their principal over time while providing them income to live off of. With this, I figured well if it "aint" broke why try to fix it. Thus, I do the same for me and my wife.
Thank you Dr. Madell @tmadell for writting about your five year study concerning capital formation as I found it to be extremely interesting.
Cordially,
Old_Skeet

Linked chart might shed some light. Compares returns (both stocks and bonds) among different countries since 1900 (but ends with 2014). Clearly, U.S. stands out as leader when it comes to equities.
https://monevator.com/world-stock-markets-data/
Some things to keep in mind:
- U.S. benefitted over the century from many unique cultural, societal and political advantages (including a strong regulatory, legal, judiciary framework and strong educational stystem).
- It costs more to invest abroad for a variety of reasons - some related to the above.
- The chart may not reflect the impact of currency fluctuation. I’ll take a 0% market return over a 10% market return if the currency of the former appreciated 20% while that of the latter declined.
- The world has changed dramatically over the past century. Namely, industrialization and technological innovation are far more widespread across the globe today than just 50 years ago.
- Assuming outperformance by the U.S. continues for decades more (a big assumption) an investor might still want to dampen year-to-year volatility by spreading out across the globe.

You know, just as an example, for the past few years everyone has been saying "go short term" for bonds, but the "long term" bonds have done better. Theory and Practice are two different things.
I often wonder if "you will do better in emerging markets" is more a low-risk prediction game given recent history rather than any fundamental intellect from those who keep saying it.
Specifically, everyone has been beating the drum on "emerging value". If you look at PRMSX to PRIJX comparison, has not quite played out that way. I have basically given up on trying to grow a brain realizing that's what most people who put ideas in print are doing.

FWIW, Schwab lists PONAX with a net exp ratio of 1.45% It also shows it has a 12b-1 expense of .25%. So I have know idea what you would end up paying. But, I haven't owned it for a few years so don't care.

I was working on increasing foreign exposure in my portfolio after the last few years run up in the US market. Using Portfolio Visualizer, increasing international exposure lowered CAGR, Sortino, and Sharpe numbers. Since PV is backward looking data that made sense to me as US has been much stronger than Foreign. I then started using earlier start dates to minimize the recent results but I ran into same numbers being lower the more foreign exposure I increased. This writer finds similar results.
https://fortunefinancialadvisors.com/blog/the-global-portfolios-rough-three-decades/
(dated Mar 2019)
He's not saying not to invest outside the US but he writes:
"It seems that no matter how one looks at the data, the last few decades have not been friendly to the global equity portfolio when viewed through the lens of an American equity investor. However, I do not want readers to come away thinking that I am opposed to investing abroad. Far from it! As I have argued previously, there is no compelling reason to own everything in the foreign equity universe. Similarly, foreign equity portfolios with factor tilts such as momentum and minimum volatility offer value to investors. In addition, investors may find better value in foreign small caps as I have discussed here and here. So, by all means, diversify your portfolio not just sufficiently, but also prudently".
He had also written previously that US Tech and Health Care sectors may also have been a major reason for US out performance as well.

"Simon">From my own perspective I've hugely enjoyed reading and digesting this thread. I've learned a great deal and have researched almost every fund mentioned. Thanks to every contributor and dtconroe in particular for starting the discussion and for his exceptionally well informed comments.
My personal circumstances are such that when it comes to bond funds (both mutual and ETFs) all I am looking for is a greater overall return than an online savings account. Let's say anything above 1.8% APY. Preservation of principal is absolutely paramount because I may need to withdraw money on very short notice for my wife's medical expenses due to a back injury. (We both have high deductible plans.) Therefore, I have money in ultrashort duration/ultrashort maturity funds like TRBUX, SEMRX, DLSNX, MINT, and just this week I have opened a position in JPST. All of these I consider cash alternatives with little to no risk to principal. These are in taxable accounts separate from our retirement plans.
The wife and I work for the same employer and we are both around 80% stocks/20% bonds in each of our 401K plans - with 20 and 12 years to go until full retirement respectively. That allocation will of course change as retirement nears. The single bond fund we use (out of a grand choice of only two) is WAPSX. Both of our Roth IRAs are 100% in equity mutual funds because we are very bullish for the coming decade and are prepared to weather the inevitable volatility.
As so many have rightly said - everyone's circumstances are different.
Simon, I appreciate your describing your unique circumstances, and your investing approach to address those circumstances. There are many of us who can identify with your description, and many of us who choose to adjust our investing decisions to accommodate our spouses and their wishes/needs. My wife does not have health issues, but in our joint taxable account, about half of it came from my wife's inheritance of her deceased parents estate. She is very conservative and has made it very clear to me what her risk tolerance is--very very conservative, with very low volatility as a key component of what is chosen for her inheritance and her personal IRA monies. That leads me to trying to find funds that she is comfortable with, not funds I try to force on her.
Best wishes on your investment choices.

"Carefree">My 401k provider offers PONAX -Pimco Income A- in the plan, but the expense is 1.45. Thoughts avoid because of the expense is so high or buy it? The only other bond fund is BHYAX BlackRock High Yield. I’m 55 years old and I appreciate your thoughts.
Carefree, you are quoting Gross Expense Ratios. You have to look at the Adjusted Expense Ratios for the actual ER you will be charged. The Adjusted Expense Ratio shows the ER after loads and other expenses are waived. When you do that, you will see the Adjusted Expense Ratio for the 2 funds are about the same, around .90. PONAX and BHYAX are 2 very different kind of bond oefs--BHYAX is a sector HY bond fund in which almost all assets held are below investment grade. PONAX is a multisector bond fund, with a small portion in junk bonds, some in Emerging Market, but the bulk in mortgages. When you chart the 2 funds, you will see the performance pattern for PONAX is much smoother compared to the higher standard deviation of BHYAX. PONAX has become a huge AUM fund, with over 130 billion AUM, but overall it appears to be a much less risky bond oef than BHYAX. BHYAX will correlate much more closely to equities than PONAX, so if you are looking for some level of ballast with a smoother ride, PONAX will probably fill this role a bit better and offer you more diversification than BHYAX. Good luck with your decision.

If that's your only 2 options I would buy PONAX because it's more of a ballast fund than BHYAX. I would start making adjustments to your asset allocation gradually 5-7 years before retirement.

As so many have rightly said - everyone's circumstances are different.

Is it really true that everyone's circumstances are different? can it be that 2 investors with similar situations invest completely differently and both be correct?
Examples:
1) I played tennis with a guy that sold his company for 15 million 25 years ago and put all his money in Munis.
2) I helped several ex co-worker all their twenties around 2009-10 with their 401K, one was scared and invested it at 30/70, the other selected 90/10.
3) Two ninty years old guys each with savings to cover the next 20 years. One invests at 20/80. The other invests at 80/20 because he knows he will have enough and his money will go to the kids.
4) In the last 5 years I read hundreds of posts where investors use MM,CD and funds like MINT and made less than 2% while many bond funds made a lot more and several of them with extremely low volatility.

Hello Carefree. My opinion is "why have a bond fund when you are 55 years old", unless you are planning to retire in a couple of years. I was 100% equity until 2 years before retiring at 67. Having said that my 401k had PIMIX ("I" shares), which I used for the last 1-1/2 years before retiring. I also owned BHYAX (BHYSX at Schwab, load waived) in my TIRA account as one of my first bond OEFs. Both are good funds IMHO.
Some will not buy PONAX/PIMIX due to the high ER. High ERs don't bother me in bond OEFs (or equity OEFs as well) as long as the returns justify them. One thng about PONAX/PIMIX is that Pimco keeps the income the same each month. Most bond OEFs do not.

My 401k provider offers PONAX -Pimco Income A- in the plan, but the expense is 1.45. Thoughts avoid because of the expense is so high or buy it? The only other bond fund is BHYAX BlackRock High Yield. I’m 55 years old and I appreciate your thoughts.

From my own perspective I've hugely enjoyed reading and digesting this thread. I've learned a great deal and have researched almost every fund mentioned. Thanks to every contributor and dtconroe in particular for starting the discussion and for his exceptionally well informed comments.
My personal circumstances are such that when it comes to bond funds (both mutual and ETFs) all I am looking for is a greater overall return than an online savings account. Let's say anything above 1.8% APY. Preservation of principal is absolutely paramount because I may need to withdraw money on very short notice for my wife's medical expenses due to a back injury. (We both have high deductible plans.) Therefore, I have money in ultrashort duration/ultrashort maturity funds like TRBUX, SEMRX, DLSNX, MINT, and just this week I have opened a position in JPST. All of these I consider cash alternatives with little to no risk to principal. These are in taxable accounts separate from our retirement plans.
The wife and I work for the same employer and we are both around 80% stocks/20% bonds in each of our 401K plans - with 20 and 12 years to go until full retirement respectively. That allocation will of course change as retirement nears. The single bond fund we use (out of a grand choice of only two) is WAPSX. Both of our Roth IRAs are 100% in equity mutual funds because we are very bullish for the coming decade and are prepared to weather the inevitable volatility.
As so many have rightly said - everyone's circumstances are different.

You can edit a post you make by clicking on the icon in the upper right corner of the post. That brings up a bubble where you can click "edit".
The history of the fund's day-to-day management is one of continuity. Kevin Booth was an original manager of the fund (first with Guardian Investor Services, then with Guardian's subsidiary Park Ave) and continues as a co-manager for Park Ave. Victory acquired the management firm RS Investment Management and retained Park Ave as the sub-adviser.
Technically, Guardian was the sub-adviser through April 30, 2015. Then it switched to Park Avenue Institutional Advisers, which according to the 2015 prospectus was "organized in 2015 [as a] wholly-owned subsidiary of GIS [Guardian Investor Services]."
The SEC filing announcing Victory's acquisition of RS Investment Management Company (not Guardian) said that it would keep the subadvisory contracts in place except for a few funds. RSFYX kept its sub-adviser.
The fund's best performance has come since it joined the Victory family. So it's not a matter of the fund "still" earning a 5 star rating, but rather that it's now at the top of its game. It has a 5 star rating for its past 3 and 5 years, but "only" 4 stars over its past ten years, i.e. its lifetime.
For completeness, according to the current prospectus, "Victory Capital Management Inc "is an indirect wholly-owned subsidiary of Victory Capital Holdings, Inc. (“VCH”), a publicly traded Delaware corporation." It is not a subsidiary of Guardian.
USAA Investment Management Company was recently acquired by Schwab, and AFAIK never had anything to do with RSFYX.
https://mutualfundobserver.com/discuss/discussion/51485/charles-schwab-corporation-to-acquire-assets-of-usaa-s-investment-management-company

Looking at that graph, I must wonder who amongst us here would have the patience to sit on our stocks (or funds) for 30 years patiently waiting for them to regain their 1989 high? Before someone jumps on me, I’d better acknowledge that the graph doesn’t represent return after dividends were paid out over that period, so investors might well be net positive. Thanks to the 2 “OF”s that together posted the NIkkei 225 chart.
BTW - I remember well that period. Everybody was trying to figure out why Japan seemed to be so far ahead of the U.S. financially. Delegations were sent to Japan by U.S. businesses and schools to try to get at the answer. Quoth one after returning: “I don’t get it.”

This was the key sentence for me.
"And over 90% of these bonds are AAA, AA, or A rated."
After watching "The Big Short", I say bulls***. IF you just said it is fund from Vanguard, duration approx 5 years and diversified with 9000 bonds, you had me. Then you add that sentence,...
Vanguard Prime Money Market. Fin.

Mark "Not a fan of Mutual funds, no out performance"
FD I'm a huge fan of Mutual funds. Buying stocks can be rewarding or spinning your wheels. Over the years my stock funds had better risk/reward than the market and my bond funds beat the indexes by a lot.
Buffett recommends most people including his wife to use the SP500 index. FXAIX expense is extremely low at 0.015% and if you really want cheaper than that go for FZROX with zero expense.
If you like single stocks then go for it. If I had to select single stocks I would definitely go for the biggest high tech companies. Over 4 decades they lead the stock market.
===================================
Mark: "Investment style is "anti-fragile" ala Taleb. Majority % of investments in safe, very conservative investments (T-Bills, 5 year CDs), smaller % in DERI Dominion Notes and ~15-20% in handful of stocks mentioned above."
FD: I'm definitely not in Taleb camp of a black swan. Many investors that believed in a black swan stayed out of the markets since 2008 while stocks+bonds had one of the best periods in the last 10 years.
As a conservative investor, I never used CD and t-bills and very unlikely I will use them in the future since I can find better mutual funds like PIMIX,IOFIX and HY munis ORNAX,NHMAX,OPTAX which made me so much more. Just a year ago so many posters were falling all over themselves when they found MM and CD that paid 2.5% while my bond mutual funds made me easily over 10%.
Finally, I wish you good luck with your endeavor.

Baseball_Fan: "Following closely the Bond OEF Investing for more Conservative Investors...does anyone on that thread really trust/know what their funds are invested in? Even conservative funds with asset backed holdings rated highly by the rating agencies you have to wonder don't you? Crazy how many high priced homes I see owned by folks who drive older beat up cars. Don't want to sound elitist but something tells me they are leveraged to the hilt which could spell trouble if interest rates/job market/economy changes. Driving up Sheridan Road in the affluent North Shore burbs of CHI seems every fifth McMansion is up for sale...and same homes been for sale seems like over two years...escape from taxes and/or many of those folks living in those expensive homes know we are in an epic asset bubble?"
B, I hope you get something out of the Bond OEF Investing for more Conservative Investors. I do believe you have to establish some trust in the fund managers of the bond oef fund you are considering, and you have to invest in a manner that fits your risk level. Most bond oef mutual funds have a huge number of assets, that are broken down into categories of bond funds--government, corporates, securitized assets, derivatives, HY and Foreign assets, etc. etc. You have to do extensive due diligence to understand the fund, but it is very difficult to have a level of detailed understanding you are looking for. My due diligence often is tied to looking at detailed analytical information available on the fund web site, in its annual and semiannual performance statements, in its prospectus, etc. but ultimately I like to look at the fund on Portfolio Visualizer, see visually its performance patterns, look at upside/dowside capture ratios, study standard deviation, Sharpe and Sortino ratios, look at Peak to Trough performance in downmarkets, etc. I try to form a strong impression of what to expect from a fund, and I have to form a lot of trust in the fund managers. You have to decide what works for you, and your fund understanding, but there is a lots of information out there to help determine if it fits your needs, and the role you want fulfilled by a given fund under consideration.
Come visit me on the thread you mentioned, and you may find a host of other posters willing to give you some thoughts you may find worthwhile! Good luck and best wishes!