@shipwreckedandalone : that was Schwab from 9/30. Appears they dropped about 10% of their bonds.
Stay Safe, Derf

rickrmf If I'm not mistaken, the new mandate took effect in June or July 2020. During the March swoon, the fund followed the old mandate, so its stock allocation was only 10-20 %, when the decline started.

Where do you see 59% of portfolio in B and BB bonds?
PMEFX Inception 7/31/20.
As of 9/30/20: 25.7% equity and 74.3% bonds. Of the 74.3% bonds: 22.7% AAA, 6.1% BBB, 27.2% BB, 22.6% B, 3.9% CCC and 17.5% convertibles. Not enough time to see how the portfolio construction settles. Limit 40% equity exposure.

Thank you, MrRuffles, that's great news.
I was always wondering what happened to former Berwyn Income Fund managers Cipollini and Saylor after they resigned in 2019. Looks like they finally found a new home at Penn Mutual. I will be following the new fund closely, it could certainly find a place in my portfolio. Hopefully, PMEFX will soon be available at Fidelity.
Thanks, again, much appreciated.
Fred

If you’re looking for something along the lines of the old Berwyn Income Fund, you might want to look at PMEFX, a new fund run by its former managers that has a very similar strategy. More info here: https://www.pennmutualam.com/strategies/balanced-income-strategy/penn-mutual-am-1847-income-fund

Yes, thanks; my chart criticism was misguided. I am kneejerk about reinvesting.
I picked a longlived mfund, FFIDX, and as usual went to:
http://quotes.morningstar.com/chart/fund/chart.action?t=ffidx
M* always includes "S&P 500 TR USD", which is often (not always) slightly unmatched by the performance of actual SP500 mfunds. That aside, the $10k value of S&P 500 TR USD as of 1/11/73 returned to $10k (with reinvestment), indeed had broken even and then gone above, by 7/2/76. Which is earlier than I wrote.
This abovewater state continued for a while.
I don't know what a fair fund example would be for SP500 for that period. FFIDX, fwiw, was itself back to breakeven by the middle of June of the Centennial, ~3.5y later.

« 1929 will never repeat... »
When my parents died and their house needed selling, my sibs and I found a pile of stock certificates representing shares in companies that had ceased to exist as result of the Great Crash. It was both fascinating and sobering. The companies I’ve invested in that went belly up don’t leave certificates behind, they just disappear into the ether.

"The author does mention that this price performance ignores dividends"
"Something seems off with your chart, as $10k in Jan of 1973 into SP500 reinvested was back to $10k by early December '76"
According to Wikipedia (IMHO not the best data source but quick and dirty), the S&P 500 closed at 120.24 on 1/11/73, and closed at 121.44 on 7/17/80; that was also the first day that it rose back to (and through) 120.24.
https://en.wikipedia.org/wiki/Closing_milestones_of_the_S&P_500#The_1970s_Bear_Market_(1967–1973)
This is consistent with data from TheStreet.com, which shows that the 1973 high for the S&P 500 was 120.24 and that no subsequent year achieved a value at least that high until 1980.
https://www.thestreet.com/investing/annual-sp-500-returns-in-history

@LB,
My trough period intervals were taken from M* $10k growth (= reinvestments) of FXAIX.
Something seems off with your chart, as $10k in Jan of 1973 into SP500 reinvested was back to $10k by early December '76, meaning breakeven a little less than 4y later.
The US market was sideways the next two years after that, though, yes --- until the nonstop bull started mid-'78 and rolled and rolled till the late summer of 2k.
So I dunno where their 7.5 comes from.
1929 will never repeat for a whole host of reasons behind now being way different.

Thanks all for this discussion! I hold IVIQX in this space and it has been even more disappointing than TBGVX. After reading the commentary, I am going to give them a little more time but I also am thinking about adding some more foreign, going from 5% to 10%. My preliminary look points me toward adding a Fidelity fund or an iShares ETF from the LB category.
FYI - this topic was also discussed, more generally, back in August : https://mutualfundobserver.com/discuss/discussion/comment/130072/#Comment_130072</
a>

It's funny how most studies on market performance ignore the Great Depression as if it never happened, yet the first article does reference it:

The author does mention that this price performance ignores dividends so the recovery rate would've been sooner than 25 years with that, but I wonder how many people during the Great Depression would have had the stomach or the financial wherewithal with 25% unemployment to hold on and reinvest their dividends as the market went into free-fall.

For SP500 w full reinvestment:
This is even true for the peak starting 9/2k --- it took ~6y, though, following the ensuing dip --- and for the peak starting 11/07 --- and that one took, following the ensuing dip, just under ~5y. To break even.
Sobering, but if one stays optimistic ....
Worse, as everyone knows, if you 'ignore' (somehow) the second peak (and had gone all in Labor Day 2k), it was not until xmas 2010, over a decade later, that you were breakeven on paper --- and that while suffering ~27% inflation.
Such a scenario certainly seems more likely now going forward than anything else, with the market 'foaming at the mouth':
https://www.nytimes.com/2020/12/26/business/investors-bull-market-pandemic.html

This is why Warren Buffet recommends S&P 500 index fund for many investors. The compounding return year after year helps to build wealth.
My kid's 529 college funds invested in Total Market Index, Total Int'l Market Index, Total bond index and Total int'l bond index fund. Eighteen years later the 529 plan accumulated enough to pay for their 4-years college tuition plus room and board. The cost basis is about 40% of the total sum after 18 years of compounding. Through monthly investment the college grew and grew. We also added our year-end bonus to the 529 fund. Asset allocation were adjusted to pay the college bills.

I completely agree with the idea that many people should pay more attention to living and less to making a living. And if you're one of the fortunate minority at risk of dying with a surfeit of cash, there are many worthwhile things you can do with that money to solve this "problem".
But I do take issue with how the figures are presented.
" the average inheritance in the U.S. being $177,000(the median is closer to $69,000)"
The two numbers come from different sources. Which is curious, because the writer had available figures from the same source (Survey of Consumer Finances) on the page he cited:
$707,291 (average) and $69,000 (median).
By mixing numbers from different sources, he makes it appear as though average and mean are not all that far apart. So don't worry when he then gives only average figures:
"The average retired adult who dies in their 60s leaves behind $296k in net wealth, $313k in their 70s, $315k in their 80s, and $238k in their 90s."
However, from the source of that quote also comes this:

The median respondent that died in their 60s had about $3,000 in liquid investments within two years of their passing, which increased to $10,000 for respondents that died in their 70s and $15,000 for those that died in their 80s.

Without liquidating or otherwise monetizing their homes (if any) many people have virtually no assets to live on.

Indeed, about 46 percent of senior citizens in the United States have less than $10,000 in financial assets when they die. Most of these people rely almost totally on Social Security payments as their only formal means of support

https://news.mit.edu/2012/end-of-life-financial-study-0803
The shift from inheritance (used in the original piece) to liquid asset data in the quotes I gave is deliberate. If we're talking about trading money for time, we're talking about the money that you have to spend, not how much your heirs will inherit.
If one has the resources, or projected future earnings, to take more time for oneself, definitely go for it. But for far more people than his figures suggest, being able to do so is only a dream.

If you're interested in multisector bond funds, you may want to consider RCTIX.
Fact Sheet

Thanks for the suggestion, Observant.
RCTIX is already on my watch list and I am currently monitoring its risk/reward performance. So far, so good.
Thanks, again.
Fred

Thanks for sharing, Rick.
Currently, ARBIX, TMSRX, PIMIX and TSIIX make up 65% of my portfolio that I feel fairly comfortable with going into 2021. It's the other 35% that I am struggling with. With high equity valuations I might hide out in funds like FIKFX and VASIX, or do I keep using allocation funds like JBALX and VLAIX, for example, with significantly higher equity exposure, in the hopes that the new vaccines we will soon establish herd immunity and the economy will come roaring back and stabilize the markets?
CTFAX looked like an excellent low volatility fund until its mandate was recently changed requiring it to hold a minimum of 50% in equities. I also looked at GAVAX but it's loss of 12.8% in 2018 makes me uneasy. Do you know by any chance what happened?
GIBLX, an excellent intermediate core-plus bond fund with a good record, used to be in my portfolio until very recently. But with a SEC yield of only 1.84% and a longish duration of 7.3, I don't see it repeating its past total return performance in the current low interest rate environment.
Anyway, just some random thoughts.
Wish you the best of luck and happy holidays.
Fred

I had rather large positions in ARBIX and MERFX. I never lost much money but never made much either. Over last 15 years MERFX has paid out about 10% in income and the share price is up 25% Over a fifteen year period that's not much
There is no magic cure in this low interest rate environment. With a duration of 8 years, VWINX may really hit the wall if rates go up. If there is a substantial equity pull back, you could lose 10 to 15% in a week or so.
I think at these valuations you are better off DCA into a target position over months if not a couple of years, unless you understand options well enough to buy puts ( which reportedly are very cheap now)

If you're interested in multisector bond funds, you may want to consider RCTIX.
Fact Sheet

It is confusing and very messy when dealing with portfolios of all different maturities, coupons and ratings (different yield curves). That's why it's easier thinking about these questions with a single bond or a homogeneous portfolio of bonds all the same.
If you own a bond and sell it before maturity, even assuming that rates remain the same, you'll get a bit more than YTM. This is because longer term bonds pay higher rates. Since SEC yield reflects YTM, I don't believe this return is reflected in that yield.
Think of a two year bond paying interest annually. Let's say that market rate for a two year bond is 2% and market rate on a one year bond is 1%. (This time I'll ignore pennies for simplicity). If the two year bond pays 2% each year, it will cost you $100 (par).
A year after buying, you get a 2% interest payment. You're now holding a 1 year bond with a 2% coupon (that's above the 1% market rate for a one year bond). So you're able to sell that bond for $101 (1% premium). Your net return: 2% market rate interest plus 1% in capital gain.
[A buyer of your bond, if holding to maturity would net 1% on that bond (2% coupon less 1% loss in value). There's your 4% total return over two years.]
There's no difference between you doing this with your own bonds and a fund manager doing this with the fund's portfolio. You get more total return by turning over bonds because you're taking on more risk.
When holding a two year bond to maturity the average maturity over that time is one year. If instead you sell a two year bond after a year (and replace it with another two year bond), your average maturity over time is 1.5 years. You're always holding a bond that matures between one and two years from now.
We didn't assume rates were changing here - just that we didn't have an inverted yield curve where shorter bonds pay higher yields than longer bonds.
Rates changing complicates this. If you swap one bond for another of the same maturity, nothing's going to change. It's as if you sold your bond and then simply repurchased it. Your sale price and your purchase price will be equally affected by the rate change.
But if you're selling shorter maturity bonds and replacing them with longer maturity ones, then a change in the yield curve is going to affect how much you get for extending that average maturity. In ways I honestly don't want to work through right now :-)

@Observant1
Nice article by Ben Carlson, as usual. Thanks for sharing.
I'd add Bruce Berkowitz and the Fairholme Fund FAIRX to that list.
And Bill Miller of Legg Mason Opportunity Fund LMOPX.
There is also a fund company in SF that publishes the NoLoad FundX Newsletter, which is good. And they employ a hot fund chasing strategy in FUNDX. But it too has had years of over-performance followed by years of under-performance.
c