FYI: Buy and hold isn’t a perfect strategy. If you convinced somebody in the fall of 2007 that this was the right way to invest, they’d have a bone to pick with you, as they’d watch U.S. stocks crash by nearly 60% over the following sixteen months.
But if this person were able to hold on, even if they bought on the day that the market topped, they would have received 7.48% per year over the next 10.5 years. Not so terrible. The most recent decade actually worked out okay for investors, even if it wasn’t easy.
Regards,
Ted

My mom is freaked out by the market volatility this year and wants to take some money out of some of her Fido equity funds and put it into one or two Fido bond funds. She's looking for Fido bond funds with large dividends and seems to want to park her funds into these bond funds for many years.
I have some ideas of high dividend Fido bond funds that she could put her money into but I would also like suggestions from this board. Thanks in advance for any and all suggestions!

Now both GABCX and GADVX are available with a tf at E-Trade with a 25 basis point difference in expense ratios. Still hoping GADVX will go back to a ntf fund as it was several years ago.

Back in 2003, I bought a "zero" at a great rate, almost doubling my money over 10 years. I'm not finding quite so high a rate at that same source, these days. Anyone able to point me to a government-issued "zero" I can buy DIRECT, and denominated in dollars---like the last time--- bypassing brokers and mutual funds? Thanks. (I can't even BELIEVE how the Irish gov't lately sold a huge slug of "zeros" at a negative rate. I mean, it boggles me!)

" ... In fact, not a single mutual fund has beaten the market since 2009. "
There's your first clue that the writer is statistically challenged. Is the question about outperformance since 2009 (i.e. 2010 to the present), or since March 2009? The start of the bull market is often pegged as March 9, 2009.
Then there's the question of what "the stock market" means: S&P 500, S&P 1500, Wilshire 5000, MSCI All Country World Index (ACWI), .... For kicks, let's use the S&P 500. Growth of $10K (using M* charts) :
March 9, 2009 through March 23, 2018
VPMCX: $52,028 vs. S&P 500: $45,832
Jan 1, 2010 through March 23, 2018
VPMCX: $31,087 vs. S&P 500: $27,587
Though the lead question (regardless of starting date or market index implied) is not what the article is about. The article asks whether any fund landed in the top quartile every year since the bull market began. Again there's the question of whether this means calendar year or years ending each March 8th.
Then there's the question: top quartile of what? Peer funds (same category) or all broad-based domestic stock funds? But wait, it gets worse. While the article says that the universe studied was broad based domestic stock funds, it writes about two small cap energy funds that remained in the top quartile for five successive one year periods. Bzzt, wrong universe (of funds).
The bottom line is that, lousy writing and lousy analysis aside, it's starting with a lousy premise: that a good fund is one that lands in the top quartile year in, year out. That would rule out index funds.
VFINX (among large cap blend peers) ranked in the 54th percentile in 2009, 31st percentile in 2010, 38th percentile in 2012, 44th percentile in 2013, 29th percentile in 2016, 33rd percentile in 2017, and 29th percentile YTD. Since 2008, VFINX landed in the top quartile only 3 times (1/3).
Don't get ripped off by bogus metrics.
Edit: I was working on this as Catch posted other comments. Interesting that we both cited VPMCX. I was originally going to use FCNTX (another of Catch's funds), but while it outperformed the S&P 500 from 1/1/2010 on, it slightly underperformed since March 9, 2009. Still, a very good fund.

http://www.rfsadvisors.com/etfs-vs-mutual-funds/
How many mutual funds would you guess outperformed the stock market since the last bull run started nine years ago?

I've been holding on to POSKX due to a large appreciation over the past few years, but it is a volatile fund, in my opinion. It really tanks when the market goes south.

@davidrmoran I've been a DSEEX owner for several years. Although it may not be a fair benchmark for comparison, I use VTI. I've noticed that, over the past year, DSEEX's performance is 3% or so below VTI.
Any thoughts as to why this underperformance has taken place and whether it might continue? Thanks!

@bee, I also find it very confusing on TRP's side. The funds named "Retirement" are essentially asset allocation funds. I don't believe they change much if at all in equity/bond allocation. They should be called more appropriately '60:40 fund', or '50:50 fund' or '70:30 fund', whatever the allotment.
My 401k was with TRP for many years. I can remember them sending information a couple years ago when they decided to go the 'target date' and the 'retirement' funds as different style offerings. I don't remember the rationale .

I will add this... for those invested in TDF and within 15 years of retirement:
Do some homework. Figure out your retirement income sources and your likely retirement budget.
Any shortfall will need to be made up by withdrawing from other investments. This should be considered "safe asset money".
Find some alternatives to even the most conservative TDF (TRRBX for example). Here are a few funds that I quickly compared to TRBBX (VWINX, PRSIX, and AONIX).
Looking at the 2007-2009 time frame is important in this comparison. Find other funds to compare and possibly decide on a few that would appropriate for your "safe asset money" Funds.
Remember volatility can be both negative and positive:

For melt up: great economic fundamentals, Fed that appears moderate to dovish, an administration eager to cut whatever taxes / regulations business wants it to
For "this is it": high valuations in nearly every market, several common signs of a peak (e.g. a clearly insane mania, now bitcoin, 20 years ago pets.com etc; or bigtime fraud, now Theranon, then Enron), possible trade war, an executive branch that appears (to me) utterly incapable of handling any kind of crisis, and the chance that Mueller will find a smoking gun and political instability will result.
Hard to say what it'll be, but I've been slowly selling equities, bringing my allocation down to 65% from 80%.

This is the most useless thing I have read in some time:
... ask yourself if your TDF's risk level is right for you. Here are three questions to ask your 401(k) ... fund company:
-- How much market risk are you taking within five years of your target or retirement age? If the stock mix is more than 70% in that timeframe, you could get nailed by a bear market.
-- How much bond-market risk are you taking? Shifting most of your money into bonds near retirement is risky as well. ....
Whatever you do, don't plug into these funds and forget about them.
Gawd.
@Bee's take above is thorough and thoughtful while Surz's is insanely conservative and seems to ignore recovery times of recent decades.

@JohnN, From your linked article was this quote:

Ron Surz, president of Target Date Solutions, a company that designs "smart" TDFs, has been sharply critical of conventional TDFs for years. “These funds with high concentrations in stocks are a time bomb,” Surz told Reuters

I found a paper that RS wrote that further explains his strategy.
targetdatesolutions.com/pdf-source/DeRisking-Target-Date-Funds.pdf
If I understand his strategy correctly he is recommending that investor's in TDF reallocate all accumulated contributions into safe assets 15 years prior to retirement date. So if your retirement date is age 70, then at age 55 one would separate out all accumulated contributions and place them into "safe assets". He doesn't explain what these "safe assets" are other than saying that they will not lose money. I assume the accumulated gains remain invested in the TDF.
My take:
With this strategy, does one assume contributions made during the 15 year window (age 55 - age 70) also no longer get directed to the TDF? I am assuming they are being directed into "safe assets". I would worry about inflation risk over this 15 year time frame. Shifting the contribution component of your TDF 15 years prior to retirement seems excessively conservative to me as well during this 15 year period. Depending on the size of that accumulated contribution and its importance in supplementing retirement income I would shoot for funding a 5 year supplemental income bucket (safe assets...maybe laddered CDs or Treasuries).
Setting aside five years of safe assets seems appropriate. Creating this 5 year bucket during these 15 years before retirement would allow the portfolio to re-allocate during years when the portfolio had positive returns or excessive returns or growth in a dollar amount equal to 1/5 of the safe asset bucket or whatever criteria would sustain growth without compromising market opportunities.
These 5 years of safe assets could be accessed (withdrawn from the retirement account) to supplement other retirement income (SSI, pension, work or rental income, income from LT capital gains, etc.). In addition, It should be adequately funded to help the retiree meet inflation increases that are not built into their retirement income sources.
Keeping in mind that the first five years of retirement will have different supplemental needs than year six or year 16 or year 26, this 5 years supplemental income bucket will likely have a rolling balance that reflects the future 5 year rolling withdrawal needs throughout retirement.
Preparing to add to the 5 year bucket could start 10 years prior to the need. Again, market opportunities (positive volatility) could be maximized to help determine the timing of the funding. This would allow this reallocation to be laddered to mature when needed or be place in some other safe investment strategy.
Your thoughts?

Cetusnews seems to have vanished, so my comments are limited to what bee described.
1. Roth income limits. Here are some concerns about Kitces backdoor solution, a couple pragmatic and one a matter of principle.
I don't know how many 401(k) plans allow transfers from IRAs. If you can't segregate pre-tax and post-tax IRA money via an IRA to 401(k) transfer, backdoor conversions are often impractical. Too much pre-tax money in the IRA.
Also, even if you can move your pre-tax IRA money to your 401(k), that money will be stuck there, whether the 401(k) is a good plan or not.
The matter of principle is that, as Kitces stated, what makes backdoor conversions illegal is intent. The fact that you won't get caught if you follow his prescription doesn't make it legal. Just in case that matters. Me, I jaywalk daily and twice on Sunday.
3. Time value of Roths. Locking in rates can be good or bad. Would you lock in a 5 year CD at 3% now when you can get 2.5% on an 18 month CD? There is potential value in flexibility - one can contribute to a traditional IRA and convert to a Roth some time in the future when taxes are lower (locking in that lower rate when it materializes).
Whether you want to wait depends on what your crystal ball shows for future tax rates from now until retirement, and perhaps beyond. Personally, I'm betting on higher taxes (and locking in via Roth conversions of past years' contributions), but that's just one individual's opinion.
Someone who has difficulty maxing out IRA contributions is more likely in retirement to draw steadily from an IRA for income. That will limit the growth of the IRA, so that RMDs (and taxes) don't grow out of control. On the other hand, if one can easily max out IRA contributions, the time value of the Roth becomes even more important.
Here's a numeric example showing that even if tax rates are somewhat lower in retirement, contributing to a Roth (if you max out) can be better than contributing to a traditional IRA. It comes out better because when you max out a Roth you're sheltering more dollars (in after tax value) than you would in a traditional IRA.
Say the person is in the 24% bracket, but will be in the 22% bracket at retirement.
Assume there's $5500 in earnings, and $1320 (24% of $5500) in a taxable account. Finally, also assume that the taxable account is 100% tax-efficient (no taxes along the way), and gets taxed 15% (cap gains) at the end.
The investor can either put the $5500 into the Roth, using the $1320 from the taxable account to pay the taxes up front, or can put $5500 into a traditional account, and invest the $1320 in the taxable account.
Even with the higher (24%) taxes up front, the Roth breaks even once the investments have grown 125% (i.e. 2.25 times the original value). From that point on, the Roth pulls ahead. I've shown below what happens at the 125% growth mark, and at the 250% (3.5 times original value) point. That's still a lot less than Bee's growth (600%, to 7 times the original value).

Roth     |    Traditional  +  Taxable
Start:   $5500     |     $5500       +   $1320
125%:   $12,375    |    $12,375      +   $2970
-taxes     $0      |   ($ 2,722.50)  +  ($ 247.50)    22% tax, 15% cap gains
Net     $12,375    |    $ 9652.50    +   $2722.50   = $12,375
250%:   $19,250    |    $19,250      +   $4620
-taxes     $0      |   ($ 4,235)     +  ($ 495)       22% tax, 15% cap gains
Net     $19,250    |    $15,015      +   $4125      = $19,140

A few weeks ago on Consuelo Mack's program, Bob Doll said that there were only 2 possibilities: either this is it (meaning the bull market is ending......or......we have a melt up that carries the market much higher over the next 1 to 3 years.
Which of these seems more likely at this point? Or is there a third possibility?
Personally, I feel very strongly both ways.

FYI: Nine years ago, the US economy sank into a recession, the housing market crashed, and credit markets seized, bringing the banking industry to its knees. Businesses were going down. Workers were losing jobs. Americans were losing hope. For many, the psychologically critical low moment was the Lehman Brothers bankruptcy on September 15, 2008. But the memory of events before and after that day is slowly fading.
Business Insider outlined the 27 major moments, from 2007 to 2009, and added some context. From the initial reports of subprime defaults to AIG's second bailout, here are the scariest moments of the financial crisis.
Regards,
Ted
http://www.businessinsider.com/financial-crisis-scariest-moments-2017-9#february-8-2007-hsbc-says-its-bad-debt-provisions-for-2006-will-be-20-higher-than-expected-because-of-a-slump-in-the-us-housing-market-nonfinance-people-start-paying-attention-to-what-subprime-is-1

@MikeM, I reduced my equity and bond allocation by 15% early in the year and have been holding double digit in cash. We had a good run last year but the geopolitic situation has worsen and the possibility of a trade war. I may increase my TRP Capital Appreciation and let the manager to make that decision. He has been right on in last several years.

I'm gonna disagree...mostly.
Problem 1- Roth IRAs have income limits: If your income is too high to contribute to a Roth IRA (a good problem) you have the financial ability to contribute to a taxable retirement account and then orchestrate a "back door" Roth strategy...problem solved.
Source:

Since the income limits on Roth conversions were removed in 2010, higher-income individuals who are not eligible to make a Roth IRA contribution have been able to make an indirect “backdoor Roth contribution” instead, by simply contributing to a non-deductible IRA (which can always be done regardless of income) and converting it shortly thereafter.

https://kitces.com/blog/how-to-do-a-backdoor-roth-ira-contribution-while-avoiding-the-ira-aggregation-rule-and-the-step-transaction-doctrine/
Problem 2 - Roth IRA benefits can be limited: Roth death benefits are tax free for the beneficiary. Tax deferred IRAs are taxable upon death to the beneficiary. If you die early...your dead... regardless. I would agree that if your beneficiaries are non - profit organizations, then, by all means, contribute to tax deductible IRAs and pass the entire tax deferred account on the the non-profit tax free.
Problem 3 - The time value of money can be hard to beat:
Time value is the very reason Roth IRAs are such a great long term retirement investment. You pay less "real dollars" in taxes. When you contribute to your Roth IRA you pay taxes in today's dollars. A $5500 contribution at the 15% tax rate would equate to $825 additional income tax...at 20% rate would equate to $1100...at 25% rate would equate to $1375. The 2018 lower brackets look like this:

If you will fall within these lower brackets it make tax sense to contribute to the Roth. It also makes sense to lower yourself into these brackets by deducting income on contributions to tax deferred IRAs. A combination of the two is also a good strategy.
Fast forward to age 60 (30 years of compounding growth @ 7%):
This one Roth contribution ($5500) would have a value of about $39K (tax free) and has no RMD requirements at age 70. At age 70, it will have grown to almost $77K. This money can help you strategically lower your taxable withdrawals from other taxable accounts to further minimize taxes. This can also help you avoid many income based costs (i.e.- income based medicaid premiums) or qualify for income based subsidies (too many to list).
Fidelity article on Strategic Income Withdrawals:
https://fidelity.com/viewpoints/retirement/tax-savvy-withdrawals
Had this contribution grown in a tax deferred IRA, the deferred tax liabilities at age 60 would be - $5850 (@15% rate), $7800 (@20% rate), and $9750 (@25% rate) and about twice that at age 70. Roth locks in the tax rate at the point of contribution...tax deferred is always the differential between what you saved on contributions (your tax deductions) verse what you paid on withdrawals (your tax liability on your withdrawals). RMDs force your income higher so you have less control over income levels.
If you can lock in a low tax rate on a contribution with either or both tax free (Roth) or tax deferred (401K, 403b, 457, etc.) this is a tax bird 'in the hand". The real problem is not knowing what your taxable income will be on your tax deferred withdrawals in retirement... that is the "tax bird in the bush." and not having a mechanism to help strategically live on some tax free income when it is to your advantage. Saving 15% on contributions to then, 30 years later, pay a higher tax rate on withdrawals is a real long term loss of capital (withdrawal tax rate - contribution tax rate) compared to the Roth IRA (contribution tax rate).
I like to think of the taxes paid on a Roth contribution that permanently locks in the cost of taxes. Obviously, there are many other advantages to a Roth IRA such as access to you contributions at any time tax free, no RMDs, and the ability to fine tune your retirement income with regard to tax liabilities by accessing tax free dollars.

I have held this fund for over 5 years (institutional version CMTFX) and have been very happy. Its a bit less volatile than my other tech fund PRGTX , and the fact that the Price fund was very concentrated, warranted having two tech funds.

This is not a suggestion or recommendation to @Junkster, but I'll just point out the obvious. As of Friday's close, a ladder of individually held to maturity Treasuries were yielding, not adjusting for state income tax exemptions, with little or no compounding of capital, and with zero worries of the "wiggles and squiggles of the markets"...
1 year... 2.03%
2 years... 2.27%
3 years... 2.45%
5 years... 2.65%
10 years... 2.90%

I was going to mention CDs and Treasuries. They are enticing. Just not sure I am ready to tie my money up to that extent quite yet. Maybe if rates continue their ascent or maybe a portion of my capital.