Target date vs target risk:
http://fiduciarynews.com/2015/05/the-big-401k-fiduciary-question-target-date-or-target-risk/
Derf

@Derf, no mutual funds, all ETFs. They use mostly their own. Out of 20 ETFs in the portfolio, 14 of them are Schwab. There are a couple others, Vanguard, ishares , Vaneck.
I don't plan to make any changes right now. I've held it for about 3 years now. I plan to reconsider the robo when interest rates start to climb and the Fed starts to raise rates again. That would be because of the large, low interest cash position they hold. Who wants to hold 12% of their portfolio in cash making < 1/2 % when CDs will be climbing to 3, 4, 5% ?
Anyway, I think it's a decent option to consider for the hands off approach, especially for those who just can't help tinkering with their portfolios. But, there are other options too.
Oh, forgot to mention, a benefit to the Schwab Intelligent Portfolio is a very low cost personal advisory service. I haven't done that yet, but I might.

The Rochester family of bond funds are extremely high octane. When things work out, the funds can be fantastic; when they don't, the funds will go down in flames. Even by HY standards, they're quite aggressive.
If you want to know who was deep into Puerto Rican bonds, look no further. They're all managed "the Rochester way".
In 2006, this fund, then known as Oppenheimer Rochester National Municipals was flying high as the top selling muni fund. By 2009 it had crashed and burned. In 2014 it settled a suit alleging that the fund had misrepresented its risks. It wasn't until last October that settlement payments were made:
http://securities.stanford.edu/filings-case.html?id=104270
Apparently this action (or perhaps others) were enough to convince Oppenheimer to change the fund's risk disclosures on July 29, 2013 and to change the name of the fund itself from National Muni to High Yield Muni on Nov 27, 2013 (per prospectus of the same date).
While much of this is somewhat old history, I don't know how much has changed. Certainly Oppenheimer made many changes on June 29th of last year, dropping "Rochester" from the name of several muni funds. More importantly, it dropped five of the six managers from ORNAX.
Of course since then, Mass Mutual has sold Oppenheimer Funds to Invesco. Maybe these earlier moves were just preparation, or maybe they're more. Certainly the ORNAX manager overhaul goes beyond window dressing.
All that said, one can't deny its high (albeit erratic) performance. I hope it works for you.

@MikeM: Thank you for filling in the blanks for me concerning robo & personal account.
Your second thought on using TRP retirement fund, or in my case VG, may be the way to go. Three pot it ,Retirement 1/3- 2025 1/3 & 2030 the final 1/3
If I'm reading you right , you'd have 1/2 in TRP & run the other 1/2 yourself ?
Does Schwab use their funds in robo account ?
Good investing to all, Derf

Hi @Derf. I think you mentioned before you might invest in robo. Here's a few numbers from my experience that might help you. Just to qualify, the robo is about 62% diversified equity, about 22% bonds, 12% cash and 4% in gold.. My self managed moves around a little because I play with stocks. I would say on average it has been maybe 40% equity and the rest in fixed income and cash, mostly cash in form of CDs. Oh, have a little gold there also. So where I'm going with that info is the portfolios are certainly not apples to apples. But here's some #s:
4th Q of 2018, robo -5.5%, self -6.7%
YTD 2019, robo +8.5%, self +7.2% (as of 5/1)
Long term not sure what I will do. You (or I) may be better off, instead of a robo, just using a TRP retirement fund. I believe the 60:40 TRP fund has better results YTD than my robo. Slightly bigger drop in the 4th Q. The cash portion of the robo absolutely weighs on return when markets are moving up. But that's how Shwab makes it's money on the "free" robo.
Good luck to you.

Latest MFO Fund Family Scorecard gives AQR a "Lower" grade. Of AQR's 39 funds, 26 trail their peers since launch through April 2019 based on absolute return.

Fortunately, most of AQR's AUM is in just five funds: Managed Futures Strategy (AQMIX), Style Premia Alternative (QSPIX), Large Cap Defensive Style (AUEIX), Long-Short Equity (QLEIX) and Large Cap Multi-Style (QCELX), which have all bested their peers since launch.

But it's been a tough past year for two of these: Style Premia Alternative (QSPIX) and Long-Short Equity (QLEIX), each down 13-14%, particularly since alternatives tend to target investors with more moderate risk tolerance.

Morn'in.
This statement from the writer (Russel Kinnel is the director of manager research for Morningstar) is misleading, and I don't understand what he is attempting to portray. One hell of a discouraging statement (below in bold) for any newbie investor or others, too. Obtaining enough clear thinking about nominal/standard types of investments is much less complex than learning fluent Mandarin Chinese.
" Picking funds for an IRA is a little tricky. The limits on yearly contributions make it challenging to build a complete portfolio. Furthermore, it's wise to view the IRA as a complement to the rest of your portfolio rather than as a stand-alone entity. However, IRAs do have their own set of rules and implied investment horizon both on the accumulation and withdrawal sides."
Let us assume a new employee at small company "A" doesn't have any access to a 401k type plan. They choose to contribute to a Roth IRA. For 2019, if they can budget the amount, they are able to contribute $6,000. This amounts to $500/month for dollar cost averaging into chosen investments.
I'm placing just a few investment choices that come to my mind and are readily available at the Fidelity.
--- ITOT, U.S. centric, cost = $66/share
--- ACWI, Global equity, cost = $74/share
--- FCNTX, U.S. centric, active managed, cost = $13/share
--- FSPHX, U.S. broad healthcare, active managed, cost = $23/share
--- FBALX, U.S. moderate allocation, active managed, cost = $23/share
I find in about 15 minutes of light thinking, several investments for a younger investor that ARE NOT tricky or leave an incomplete portfolio for growth.
No wonder folks become turned off when considering investing.
Have a good remainder,
Catch

FYI: When Walt Bettinger’s 3 a.m. alarm sounds, among the first things the Charles Schwab Corp. SCHW -1.60% chief executive does is check how much net new money his company has pulled in over the past 24 hours. Last year, that was an average of $624 million a day—more than its three biggest Wall Street rivals combined.
Regards,
Ted
https://www.wsj.com/articles/how-schwab-ate-wall-street-11556474103?shareToken=st19482b034702426f9214435d6032710f

FYI: A decade after target-date funds were damaged during the financial crisis, they have re-emerged bigger than ever as retirement investments. But they still have vulnerabilities.
Regards,
Ted
https://www.wsj.com/articles/what-weve-learned-about-target-date-funds-10-years-later-11557108540?mod=article_inline

Hi @_art.. Sir congrats! Well deserved. What is your favorite /best performer funds (vehicles) you held the past 25 or 30+yrs of investing.
Any wisdoms or ideas /tricks you wish to share regarding funds picking before heading to the peaceful sunset.
Any lessons learnt regrets you may want to share
Thank you so much

@ MikeM:From statement below you said,"
Over the last 5 years or so I've simplified my self-managed portfolio to about 8 funds that I feel good about. That's 1/2 the pot. The other 1/2 is in a well diversified robo.
Would you care to let the cat out of the bag, & report which did better for 4/th Qter 2018 ?
I'm thinking I may put some money to work in a robo or directed account.
Thanks for your're time , Derf

Congrats on your coming retirement Art. I'm about there myself, but will probably work part time to ease into retirement.
Over the last 5 years or so I've simplified my self-managed portfolio to about 8 funds that I feel good about. That's 1/2 the pot. The other 1/2 is in a well diversified robo. The 8 self managed funds include equity and fixed income funds. About 20% of that is in 1 balanced fund, PRWCX. I am not a believer in duplicating funds in categories or asset classes but to each their own. I also believe a 1 fund portfolio can be a fine idea coupled with a cash bucket in retirement. That 1 fund would be a target/retirement fund. How simple is that, but I don't think that is what you are looking for.
You, having 7 world/global funds, tells me that you and I have different portfolio building ideas, so I can't offer much help. 1 or 2 of those would be fine in my mind (or none depending on what else you hold). You can't go wrong with TRP (I'd pick PRGSX fwiw), and maybe even holding one of the Grandeur Peek funds might make sense IF they were different enough from TRP.
Good luck to you.

AKREX co-manager Saberhagen left 4/25/19 https://www.morningstar.com/funds/XNAS/AKREX/quote.html
Given the 4% turnover for AKREX that may not be an immediate concern, but the departure was unexpected.

Tend to agree with Ol’Skeet that number of funds doesn’t matter a lot. Getting the number down may well be a sign that you’ve successfully identified the funds that are most aligned with your own personal needs. So I suggest you view a lower number more as a measure of how well you’ve identified the right funds for you rather than a goal in itself.
A few things important to me in adding or culling funds (highly subjective criteria):
- Low fees
- Diversification across fiduciaries (fund houses or other)
- Diversification across asset classes
- Moderate exposure to international markets
- Superior downside protection relative to peers
Absent from my list is performance. Perhaps that’s due to it being so obvious a consideration. In addition, capital preservation becomes more important in retirement - especially later on. I’ve always strived to keep the number under 20, believing that meets my needs and is fairly easy to get my head around. Currently I hold 15 funds across 4 different management houses. In addition, I have one ultra-short bond fund that I treat the same as cash.
RPGAX is one of the 3 balanced funds I own - the only one with significant international exposure. I suspect the choice has as much to do with my preference for T. Rowe Price as with anything else. But RPGAX is a good fund with reasonable fees.

Hi @Art:
I tend to look at things in a different color of lens than most on the board. I'm thinking, this is because of my baackground being a former credit manager of a fairly large wholesale distribution company servicing the Carolinas, parts of Virginia, Tenn and Georgia. We would not let any one customer become more than 1 percent of our gross revenue nor carry more than two percent of our receivables. To keep the DSO low we required pre payment on special (non stock) items, as most were not returnable, along with good discounting for timely payment of invoices such as 2% ten days, net 30. Our larger and better customers just about always paid taking their discounts.
One might ask ... How does this have any light on your investment portfolio? It's simple. Even in my cash area of my portfolio I will not put more than a couple of percent of my portfolio into any one security weather it be a CD or money market mutual fund. Then moving on to the income area I keep the upper limit at a two to three percent range as well with two exceptions. In the growth & income area, I also have a cap on how much, percent wise, I'll hold in a single position. This also applies, as well, to the growth area of my portfolio.
If one or even a few funds falter then there are a good number of others that can continue to propel my portfolio. After all, funds do change managers and they have styles and strategies that move in and out of favor during market cycles as well. Think growth vs. value, small vs, large, domestic vs foreign, varrying regional allocations, varrying stock vs bond allocations, etc.
Not knowing more about your goals, positioning along with whatelse you own and in what percentages I find it hard to make comment on which funds you should "can" and which ones you should keep. There possibly could be tax issues that might need to be considered along with some other things as well.
Generally, the more risk associated with a fund the less of it I'll own in realation to other funds held within its sleeve, its area, and my portfolio as a whole. Take the growth area of my portfolio which now accounts for about 15% of my overall portfolio and holds a total of 12 funds with these being divided among four sleeves. The two largest sleeves are my large/mid cap sleeve and my global growth sleeve at about 30% each. The two minors are my small/mid cap and specialty & theme sleeves at about 20% each. Generally, for a three member sleeve, I'll run about a 50/30/20 percent mix. An example. In my large mid cap sleeve I'm 50% SPECX, 30% AGTHX and 20% AMCPX.
With all of the above being said ... I'm thinking you should do as you feel best and discount the thoughts of others (mine included).
If you want to reduce the number of holdings held within your portfolio I'm sure you have good reason to do this. Likewise, I have good reason, as well, to govern they way I do.
I'm also thinking, they are all good funds. Why "can" any of them?

Krugman: “What all this tells us is that Republican positioning on economic policy has been in bad faith all these years.”
Nothing new here. Don’t need Paul Krugman to know that. Have already noticed they believe they can “scrounge up” 8.5 bill in unused funds to erect a glorified 18th or 19th century wall - apparently without raising taxes. While same folks can “explain away” food for hungry kids because: “there's no demonstrable evidence“ it helps their performance.
https://www.romper.com/p/trumps-budget-manager-says-feeding-hungry-kids-hasnt-been-proven-to-help-their-performance-45235
(By the way, the fella who did all this explaining has since been promoted.)

This looks at past motives, which appear to have considerable momentum:
https://www.nytimes.com/2019/05/04/opinion/the-sabotage-years.html

FYI: When I was a junior analyst at Sanford Bernstein nearly 25 years ago, our betters drummed into our heads that everything in the investment world went back to normal and that John Templeton was right when he said that the four most expensive words in the English language were “this time it’s different.” Bernstein had a sophisticated computer model that we referred to as the black box; its job was to tell us worker bees the most statistically cheap sectors every month. Like good worker bees, we would more or less automatically buy the stocks in those sectors and sell stocks in the most expensive sectors. The black box minted money for the firm and its clients for decades, precisely because everything did eventually return to normal. Cheap auto stocks appreciated to fair value, expensive tech stocks returned to average, and the investing world was good—safe and predictable. It was indeed dangerous to think “this time it’s different.”
Regards,
Ted
https://www.barrons.com/articles/reversion-to-the-mean-is-dead-investors-beware-51556912141?mod=past_editions

So what it looks like you're saying is that only AP's are allowed (able) to pull off this stunt and not your average everyday investor. True?

Any time a fund redeems shares in kind, it can dump the lowest cost basis (highest gain) shares. This tax maneuver not limited to ETFs, and anyone can buy/redeem open end fund shares.
Whether the fund will redeem in kind is another matter, but it is usually "allowed". For example, from FCNTX's prospectus:
"In addition to paying redemption proceeds in cash, a fund reserves the right to pay part or all of your redemption proceeds in readily marketable securities instead of cash (redemption in-kind). Redemption in-kind proceeds will typically be made by delivering the selected securities to the redeeming shareholder within seven days after the receipt of the redemption order in proper form by a fund."
As an investor, do you really want to get a basket full of securities instead of cash when you sell your mutual fund shares?

Junkster

I referenced this symbol back in January 2018 and have been following it since. While impressed with its performance, there is a caveat. It is prone to out of the ordinary daily trading gains. For instance most of its outperformance YTD can be attributed to an outsized daily gain one day in January. It was the same way last year where just a couple trading days contributed to its yearly gain. I worry that could cut both ways and you could see an outsized daily decline. Also, how much longer can the good times continue in securitized credit more specifically non agency rmbs.

The fund has a limited number of holdings because of its current size. So a move in a single security can move the fund’s performance on a daily basis. I would say that more than a few days influenced RCTIX performance last year, and most daily moves in most funds are noise.
In many cases, only a few days account for the performance of many investments.
For example if you missed the 20 best days in the stock market over the past 20 years(1/99-12/18) your annualized return was -.33% vs 5.62%.
Yes, in January they monetized a bond at a significantly higher price than the pricing services were pricing it at. Their investment thesis on the bond was realized faster than they had anticipated, and when they were offered a very attractive price, decided to monetize it.
Also, there's more to securitized credit than just non-agency RMBS. They don’t know how long the good times can last, but relative to other credit sectors such as investment grade or high yield, they think securitized credit and non-agency RMBS can still offer strong relative returns.
Non-agency RMBS won’t produce the returns they have in the past, but today they still offer good yields with capital appreciation opportunities. Housing continues to improve, borrowers continue to pay their mortgages, and loan to values continue to improve. So they think these underlying trends will continue to support the non-Agency RMBS market -- which I noted in my article.
JoJo26

That's what you get with less liquid underlying instruments... Honestly, a daily liquid mutual fund probably isn't the best package to offer a strategy that is largely structured credit.
If the fund gets larger and then subsequently sees large redemptions, it will be difficult to unwind positions without taking severe down marks.

With regards to liquidity, the fund has a 60% investment grade minimum specifically designed to meet the daily liquidity needs of investors. Between cash and Agency mortgage TBA’s over 60% of the fund could be in cash tomorrow.
Additionally, regarding the non-agency RMBS, there is strong demand for this paper, and it can be liquidated quickly as well. The sector has recovered substantially and trades very well.
Investors would be wise to consider fund size with regards to liquidity in non-agency RMBS. Many of the mega funds who would need to liquidate billions of dollars in Non-Agency RMBS would have a much more difficult time than a smaller fund such as RCTIX.
Last, RCTIX invests across the capital structure of the individual securities they own. In many cases, they've invested in the senior tranches of the structure. Also, the fund is not investing in odd lot securities that can be difficult to trade.
I hope that this additional information is helpful. I'm done reporting on the fund and moving on.
Best.