The answer is actually "it's different for everybody." There is no formula.

Couldn’t agree more. Some have no REI since everything is covered by SS and pensions. My REI is 45 years and I am about to turn 72. That tells me I need to obsess more about spending my nest egg instead of more accumulation. But old habits are hard to break. Even more so since in early January there was a buy signal I have seen but 4 times since 1960.

FYI:
Regards,
Ted
February 14, 2019
Dear WEALTHTRACK Subscriber,
18th century British nobleman Baron Nathan Mayer Rothschild is alleged to have said: “Buy when there is blood in the streets.” He supposedly made a fortune speculating when Napoleon was defeated at Waterloo. We know for a fact that legendary 20th century investor Sir John Templeton followed his: “Buy in periods of maximum pessimism” principle to great success.
If you were to name places in the world where you wouldn’t consider investing today what comes to mind? How about Venezuela where the economy is in ruins, the president discredited and the opposition mounting? Or a specific company in this country like Pacific Gas and Electric, PG&E for short, the California utility that filed for bankruptcy and bore the physical and legal brunt of the recent devastating California wild fires? Those are fertile ground for contrarian investors, or just traditional value investors who look for opportunities where others fear to tread.
This week’s guest is just such an investor. Her specialty is fixed income but she has the latitude to invest around the world, anywhere in a company’s capital structure and she revels in the hunt. She is Kathleen Gaffney, Director of Diversified Fixed Income at Eaton Vance where she is also the lead portfolio manager of the Eaton Vance Multisector Income Fund, which she launched as the Eaton Vance Bond Fund when she joined the firm in early 2013.
The fund is known for its flexibility to seek higher total return opportunities wherever available in the world and the capital structure of the companies chosen. That approach has also meant “significantly more volatility” than its peers in Morningstar’s Multisector Bond category. It carries a 3-star rating but is ranked in the top one percentile for the last 3 years, the middle of the pack for the last 5 and has beaten its benchmark since inception.
Gaffney is also lead portfolio manager of the somewhat more traditional Eaton Vance Core Plus Bond Fund. It carries a 5-star rating and has ranked in the top performance percentiles for the last 3 and 5 year periods under her leadership.
The last time I sat down with Gaffney in late 2017 she told us we were at an important inflection point, shifting from a secular decline in interest rates to a gradual rise. She will share her views of where we stand now.
If you’d like to watch any of our programs ahead of their official broadcast they are available to our PREMIUM viewers on our website about 24 hours before. You’ll also find the EXTRA interview with Kathleen Gaffney about her technique to keep mentally fresh.
If you would prefer to take WEALTHTRACK with you on your commute or travels, you can now find the WEALTHTRACK podcast on TuneIn, Stitcher, and SoundCloud as well as iTunes and Spotify.
Thank you for watching. We hope you had a happy Valentine’s Day. Make the week ahead a profitable and a productive one.
Best regards,
Consuelo
Video Clip:

M* Snapshot EVBAX:
https://www.morningstar.com/funds/XNAS/EVBAX/quote.html
Lipper Snapshot EVBAX:
https://www.marketwatch.com/investing/fund/evbax
EVBAX Is Unranked In The (MB) Fund Category By U.S. News & World Report:
https://money.usnews.com/funds/mutual-funds/multisector-bond/eaton-vance-multisector-income-fund/evbax

Within equities Old_Skeet holds about 9% in energy while the S&P 500 Index holds about 5%. One of the reasons for my overweight in the sector is because a good number of the energy related companies are fairly good dividend payers. Plus, energy has been a fairly beaten up sector over the past five years. My thinking is that it is a good value play and I will get paid while waiting for it to finds some legs. Thus far and year-to-date I am finding that energy (XLE) is the second best performing major sector within the S&P 500 Index with a return of 13.46% while over the past five years it has had a loss of about 25%.
And, if this dog (XLE) can continue to hunt ... Well, I've got me a winner winner chicken dinner!

I am calling BS on this one. I have told this story before
Northern Technology Fund. $5000 to invest. Instead of investing the $5000, I thought I will first "study" how to invest. I learnt I should not "lose" the opportunity" and I "should also cost average". So I invest $2500 - the fund minimum - and then $250 a month for next 10 months.
After the dot com bust hit My total investment was under water. If I had invested the $5000 at the beginning I would have been positive. I would have held the fund instead of selling.
DCA is like everything else. Wait for the right time of the year/decade/whatever then do a "study" to say "a-ha i told you so".
My motto - when you go in, you go in quick. IF you go in after dip you went in at lower price. Math. The only good 4-letter word.

Lots of reasons to hold managed funds - low cost ones can do well, some categories are not amenable to indexing, some funds are unique.

@msf, thanks for the input. I agree with 2 of your points, "some categories are not amenable to indexing, some funds are unique". FD1000 mentioned that bond funds are a category that needs a good manager. You, bring-up SmallCap International as not being amenable to Indexing. I mentioned a great balanced fund like PRWCX and a unique fund like DSENX that continues to outperform the S&P 500. I think we are on the same page.
But I contend, the vast majority of funds talked about here, especially Domestic equity funds would probably best be held in zero cost index funds. Do you agree with that?
And a secondary point I was trying to make... holding a collection of funds in the same category is no different than holding a very high cost index fund. I tried to be subtle, but that's what I believe.

T. Rowe Price Global Technology Fund, Inc.
https://www.sec.gov/Archives/edgar/data/1116626/000111662619000004/gtfstatsticker-february20193.htm
497 1 gtfstatsticker-february20193.htm
T. ROWE PRICE GLOBAL TECHNOLOGY FUND
Supplement to Prospectus Dated May 1, 2018
On page 6, the portfolio manager table under “Management” is supplemented as follows:
Effective March 31, 2019, Alan Tu will replace Joshua K. Spencer as the fund’s portfolio manager and Chairman of the fund’s Investment Advisory Committee. Mr. Tu joined T. Rowe Price in 2014.
On page 9, the disclosure under “Portfolio Management” is supplemented as follow:
Effective March 31, 2019, Alan Tu will replace Joshua K. Spencer as Chairman of the fund’s Investment Advisory Committee. Mr. Tu joined the Firm in 2014 and his investment experience dates from 2010. Since joining the Firm, he has served as an equity investment analyst covering the technology sector. Prior to joining the Firm, he was an associate at Huron Consulting and then an investment analyst at Ananda Capital Management (beginning 2010).
The date of this supplement is February 14, 2019.
https://www.sec.gov/Archives/edgar/data/80248/000008024819000003/nhfstatsticker-february20192.htm
T. Rowe Price New Horizons Fund, Inc
497 1 nhfstatsticker-february20192.htm
T. ROWE PRICE NEW HORIZONS FUND
Supplement to Prospectus Dated May 1, 2018
On page 5, the portfolio manager table under “Management” is supplemented as follows:
Effective March 31, 2019, Joshua K. Spencer will replace Henry M. Ellenbogen as the fund’s portfolio manager and Chairman of the fund’s Investment Advisory Committee. Mr. Spencer joined T. Rowe Price in 2004.
On page 8, the disclosure under “Portfolio Management” is supplemented as follow:
Effective March 31, 2019, Joshua K. Spencer will replace Henry M. Ellenbogen as Chairman of the fund’s Investment Advisory Committee. Mr. Spencer joined the Firm in 2004 and his investment experience dates from 1998. He has served as a portfolio manager with the Firm throughout the past five years.
The date of this supplement is February 14, 2019.
F42-042 2/14/19

Can anyone explain why they use managed mutual funds that cost you 1-2% to own ...
What do others think? What are the reasons to use managed funds over free ETFs?

You're starting with a number of questionable assumptions:
- that ETFs are all passively managed index funds
- that my managed funds cost over 1%
- that mutual funds (as compared with ETFs) are actively managed, or even that they cost more than ETFs
I've said before that all else (or at least ERs and transaction costs) being equal, I'll take the mutual fund format over the ETF format because I don't risk tracking error (i.e. the part of tracking error from market price not matching NAV) and I'm not charged SEC Section 31 fees.
So I'll rewrite your question as: What are the reasons to use managed funds over index funds?
Almost none of the funds I own cost over 1%. I own a number of actively managed Vanguard funds that cost around 531;% or less. My two largest Vanguard holdings (which I've had for several years if not decades) continue to outperform; my newest (held for a couple of years) is still subject to reconsideration.
What would you suggest for small cap int'l? That's where I've had the most difficulty finding good, inexpensive funds. There's always VFSAX if one wants an index fund (or its ETF share class VSS if one insists), but one ought to be able to do better in this category. VINEX doesn't exactly excite, and ACINX has not done well for years. There are DFA funds (available through VAs, HSAs, etc.), but they're hard to get.
If one is willing to go up a bit in price, the stalwart PRIDX continues to roll along. Do you feel that index funds will do better than this?
What index fund do you feel would do a better job than RPHYX as a cash alternative? (Despite the high cost of RPHYX.)
Lots of reasons to hold managed funds - low cost ones can do well, some categories are not amenable to indexing, some funds are unique.
Still, I agree that it's getting harder to beat index funds, and over the next decade or two I'll likely shift more investments into index funds.

Investors don’t need to do anything at the moment. Since the advice is being handed out free by one of the big investment houses, consider its worth. Personally, it seems to me Goldman’s been right about 50% of the time.
Anybody ever consider that this kind of verbage (or another word that rhymes) is really more of an attempt by Goldman or whomever to get free advertising? No need to go for name recognition buying expensive ads if CNBC and others are willing to parade your name all day long in front of millions of readers and viewers.

FYI: Energy stocks aren’t necessarily the first place income investors look for yields.
Tethered to commodity prices and the vagaries of geopolitics, the sector can be volatile. The Energy Select Sector SPDR Fund (ticker: XLE) has gained about 11% in 2019, but has a five-year annual return of minus 2.75%, compared with 10.6% for the S&P 500.
Regards,
Ted
https://www.barrons.com/articles/oil-stocks-dividends-yields-51550094836?refsec=income-investing

Some recent writing (not that this is news to most here) is that it does NOT need to be 25x cashflow,
more like 22x
IOW a ~4.5% SWR

The answer is about 25 times your annual expenses at retirement. Mr. Bernstein is wrong for decades, if you listen to him, chances you will never retire, especially if you invest in Treasury inflation-protected securities and inflation-adjusted immediate annuities. You must own some stocks and you can do so much better long term with Multisector funds. Investing in TIPS? really? TIPS made just 1.43% annually in the last 5 years, even BND is a better choice. I have been commenting about him for years on Morningstar.

Huh, nearly the complete opposite from Mr. Buffett. Interesting. At the moment I'm roughly 65-35 equities to PIMCO bond funds. All of my equities are invested in dividend aristocrats (companies who have raised their dividends consecutively for 25 years or more) or those who almost make the cut. I think I'll stay where I am.

https://www.schwab.com/public/schwab/investing/investment_help/investment_research/etf_research/etfs.html?path=%2FProspect%2FResearch%2Fetfs%2Foverview%2FoneSourceETFs.asp%3Fsymbol%3Dundefined
Above is the no cost ETFs from Schwab.
Can anyone explain why they use managed mutual funds that cost you 1-2% to own when the same or likely better returns can be had with these no commission index funds? The selection is huge. I own managed funds but I often wonder why.
There are many here that collect 30, 40, 50+ mutual funds. That just has to dilute any manager affect. Wouldn't it? Why do we continue to believe we get better returns from a collection of higher cost investment vehicles when most all data suggests otherwise?
In saying that, I argued for a long time managers could "steer the ship" for a smoother, higher return ride. I don't believe it anymore. I have not totally jumped on the ETF band wagon myself but I may. I still believe for very specific funds a manager or formula can add value, for example I wouldn't give up the management at PRWCX just yet or the secret ingredient in the CAPE fund DSENX. But other than that I think I have to break away from this paradigm in believing managers can beat these no cost ETFs.
What do others think? What are the reasons to use managed funds over free ETFs?

FYI: (This is a follow up article.)
Fidelity Investments has expanded its platform to let loose a new volley of more than 500 commission-free ETFs and as of February 28, 2019, additional iShares ETFs.
One hour later, Schwab ETF OneSource one-upped competitor Fidelity by announcing it was doubling its lineup of commission-free ETFs to 503 in 79 Morningstar categories, and by adding 90 iShares ETFs to its offerings, starting one day after Fidelity, on March 1, 2019.
Regards,
Ted
https://www.fa-mag.com/news/fidelity-pulls-trigger-on-commission-free-etf-price-war--and-schwab-fires-back-43296.html?print
Schwab Website:
https://pressroom.aboutschwab.com/press-release/corporate-and-financial-news/schwab-etf-onesource-doubles-lineup-500-commission-free-e

Has anyone looked into opening brokerage accounts for bonus payments and buying short term Treasuries (at no commission)?
I started researching this, and see that E*Trade will pay $200 if you bring $25K to a new account for six months (1.6% annualized), that you could invest in a 2.4% six month Treasury.
https://us.etrade.com/what-we-offer/how-it-works/brokerage
Chase(!) has a similar offer, except that it requires you to keep the money there for only 90 days ($200/$25K for 90 days is 3.2% annualized bonus).
https://accounts.chase.com/youinvest/trade/offer?jp_cmp=rb/Chase_Brand_Exact_You+Invest_SEM_US_No+xLOB_Standard_NA
Merrill Edge will pay $100 if you bring in $20K for 90 days (2.0% annualized bonus), or $150 if you are (or become) a Preferred Rewards customer.
https://www.merrilledge.com/cmaoffer ($100)
https://www.merrilledge.com/offers/900offer ($150)

Which firm is the best?!
https://www.ft.com/content/00972e29-4390-346d-b2bc-7ffb35c4c8bf

Hi sir did u use that as cash position?!... Got few private muni bonds yield 4 or 5% but bbb-ratings in portfolio

The best 1 year CD option at Schwab right now is 2.5% from Wells Fargo (actually 13 months). Pretty poor pickings compared to a few months ago. The MM is at 2.33%, so not a lot of incentive to buy more CDs right now - for me anyway.
I have put some cash to work in a gold ETF FWIW.