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Neither fund is subject to gating/redemption fees.Why would one ever mess around with VUSXX, assuming they hold an account in vanguard? The vanguard sweep account, Vanguard Federal Money Market Fund (VMFXX), yields a tick more, is just as "safe" and has no restrictions.
This retiree prefers to separate strategies so he sees the moving parts he's betting on -- I mean investing in.Pimco Real Return PRRIX provides worthwhile inflation-protected bond exposure, which can help preserve purchasing power in retirement. By Miriam Sjoblom, (CFA) for M* ,Jan 16, 2020
"Despite some noteworthy team turnover, Pimco Real Return's experienced management team and extensive supporting cast of global-bond specialists continue to give it an edge in the inflation-linked bond arena. Given the importance of low fees in this competitive field, the fund's cheapest institutional share classes earn Morningstar Analyst Ratings of Silver and Bronze, while its remaining shares are rated Neutral."
Article Here
But for people that don't like to own too many funds this offering from PIMCO is probably safe enough.It employs macro-driven strategies (driven by real growth, inflation, and country-specific analysis) and micro-driven themes (including Consumer Price Index seasonality, on-the-run/off-the-run premiums, and implied inflation volatility). Although U.S. TIPS and, to a lesser extent, other global inflation-linked bonds dominate the portfolio, the strategy can invest up to 20% in other sectors, such as corporates and securitized fare.
The approach has led to sizable off-index bets at times, a trait that distinguishes it from its more-constrained peers, including use of Pimco's bonds-plus techniques, by which the strategy gets exposure to its primary sectors via derivatives and invests the cash collateral in short-term bonds. The team may also make meaningful and swift maturity shifts, though the portfolio's overall duration has generally stayed within a year of the benchmark's. The strategy's adventurous nature can cause its performance to diverge from that of the U.S. TIPS market at times. But overall, its flexible approach, which benefits from the insights of Pimco's broad, deep bench of global-bond experts, earns a High Process Pillar rating.
Duration is 1.9 years, SEC yield 1.56% and ER 0.07%.
It's mostly foreign, and classified as an infrastructure sector fund based in the US, just as MGGPX is a US Fund World Large Stock fund, i.e. a US based global fund.I've used two for some time now, MGGPX a world fund and GLFOX a sector fund mentioned by WABAC which M* categorizes as a US Infrastructure fund but it's mostly not. I would love to hear the logic behind that placement.
https://www.morningstar.com/articles/751882/growing-fund-choices-spur-4-new-categoriesWhat types of firms do infrastructure funds invest in?
Infrastructure funds primarily invest in energy, industrial, utilities, and telecom firms that hold long-duration assets that generate stable cash flows. Examples include toll road operators, pipeline firms, airports, cell tower owners, and electric and gas utilities.
What are the general traits of infrastructure funds?
Prior to the creation of the infrastructure category, most of the funds were classified as world-stock funds. Typically, these funds have about a 30% to 50% allocation in U.S. stocks with the remainder invested in firms domiciled in the developed world. These funds, on average, tend to exhibit lower beta relative to the market.
DODFX HFQIXAll figures as of 12/31/19
1 yr 21.06% 18.12%
3 yr 6.76% 4.11%
5 yr 2.88% 2.63%
10 yr 4.95% 4.46%
Sec yield is not an accurate number.@dtconroe
Regarding Tax Cost Ratio (TCR), I don't recall what tax rate / bracket M* uses to calculate the value. The definition M* provides is silent on the topic. For munis, with a TCR of 0% the issue is moot. Perhaps I don't understand TCR fully, but for taxable bond funds, the tax impact is tied to one's specific tax situation / tax rate and whether they are close to a breakpoint in tax brackets. The tax impact of interest / dividends for someone in the 15% tax bracket is different than for someone in the 22% bracket or higher. State and local taxes also need to be considered to get a full picture. Seems like TCR is more a relative vs. absolute measure and one needs to do further due diligence to get the full picture for their particular situation.
This M* widget at the dinky linky seems to be designed for comparing individual bonds, but I don't see why it wouldn't work for funds. It allows you to enter your Federal and State tax rates. I used the latestSEC yields for the funds I was comparing when I looked into adding a taxable bond fund to my taxed account.
dinky linky.
@WABAC: Yes, that calculator works for many situations. It does not account for Qualified Dividends which are taxed at a lower rate than ordinary dividends (0% for lower tax brackets). Some taxable bond funds hold assets which qualify for Qualified Dividend tax treatment but that info is not readily available nor factored into most calculators. While I have used the M* calculator or similar ones, for my situation, I have often found the best assessment is found by doing what if scenarios in tax software, like TurboTax, or one of the many tax estimators available online because there can be many moving parts and interactions in the tax calculations that the simple calculator does not address. At least that has been the case for my situation. As always, your mileage may vary.@dtconroe
Regarding Tax Cost Ratio (TCR), I don't recall what tax rate / bracket M* uses to calculate the value. The definition M* provides is silent on the topic. For munis, with a TCR of 0% the issue is moot. Perhaps I don't understand TCR fully, but for taxable bond funds, the tax impact is tied to one's specific tax situation / tax rate and whether they are close to a breakpoint in tax brackets. The tax impact of interest / dividends for someone in the 15% tax bracket is different than for someone in the 22% bracket or higher. State and local taxes also need to be considered to get a full picture. Seems like TCR is more a relative vs. absolute measure and one needs to do further due diligence to get the full picture for their particular situation.
This M* widget at the dinky linky seems to be designed for comparing individual bonds, but I don't see why it wouldn't work for funds. It allows you to enter your Federal and State tax rates. I used the latest SEC yields for the funds I was comparing when I looked into adding a taxable bond fund to my taxed account.
This M* widget at the dinky linky seems to be designed for comparing individual bonds, but I don't see why it wouldn't work for funds. It allows you to enter your Federal and State tax rates. I used the latest SEC yields for the funds I was comparing when I looked into adding a taxable bond fund to my taxed account.@dtconroe
Regarding Tax Cost Ratio (TCR), I don't recall what tax rate / bracket M* uses to calculate the value. The definition M* provides is silent on the topic. For munis, with a TCR of 0% the issue is moot. Perhaps I don't understand TCR fully, but for taxable bond funds, the tax impact is tied to one's specific tax situation / tax rate and whether they are close to a breakpoint in tax brackets. The tax impact of interest / dividends for someone in the 15% tax bracket is different than for someone in the 22% bracket or higher. State and local taxes also need to be considered to get a full picture. Seems like TCR is more a relative vs. absolute measure and one needs to do further due diligence to get the full picture for their particular situation.
Bingo. There is no more 15%. It goes 10,12,22,24,32,35,37.@dtconroe
Regarding Tax Cost Ratio (TCR), I don't recall what tax rate / bracket M* uses to calculate the value. The definition M* provides is silent on the topic. For munis, with a TCR of 0% the issue is moot. Perhaps I don't understand TCR fully, but for taxable bond funds, the tax impact is tied to one's specific tax situation / tax rate and whether they are close to a breakpoint in tax brackets. The tax impact of interest / dividends for someone in the 15% tax bracket is different than for someone in the 22% bracket or higher. State and local taxes also need to be considered to get a full picture. Seems like TCR is more a relative vs. absolute measure and one needs to do further due diligence to get the full picture for their particular situation.
Thanks for the tips. I still have portfolios over there, especially for shopping.Some of the information is provided on their new pages, some isn't, but can still be found on their legacy pages.
For example, if you click on the price "tab" on a new page, at the lower right you'll find the three year tax cost ratio for a fund. But I don't believe that you can find the 1, 5, 10, or 15 year tax cost ratio as you would on a legacy page, e.g.
http://performance.morningstar.com/fund/tax-analysis.action?t=VFINX®ion=usa&culture=en-US
OTOH, the legacy page doesn't give the category three year tax category tax cost ratio that's provided on the new page.
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