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Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
  • Bonds. The Intense Discussion Thread.
    Are ya wondering whether there is or is not any really silly stuff taking place from and with central banks, and continuing to attempt to prop up soft economic numbers in most places, globally???
    In spite of what or who one reads about growth here and there; the central bankers are still worried and will; one way or another, continue to place more crutches of support, wherever they find a need.
    I am sure Dan Fuss and many other superior bond managers are wringing their hands every day wondering when a crutch may bend too far and break.
    I'm not really thrilled about the prospects of higher rates (for whatever reason) and the impact upon some bond funds; "BUT" equity investors should also remain alert, too; as the removal of easy money will affect this area, as well.
    The below graph is for Euroland and the U.S. Look at the 10 year rates for Italy, Portugal and Spain. Ya, right ! Compare the current to one year ago.
    current yields
    A re-do, of a previous posted link; from May of 2010.....European Debt Crisis.....one of my all-time favorites, and still valid.
    Our largest bond holdings continue to be LSBDX and PIMIX; and dedicated HY; for reason of economic softness in the under bellies of economies.
    If nothing else, have fun with your investing time.
    Catch
    catch22 catch22 in Fund Discussions
  • How crazy would it be to implement this portfolio?
    With hindsight it looks great!! I'm a big fan of POAGX and its my largest single position so I've been very happy with its performance in the last few years. The Primecap folks have a fantastic record with the Vanguard funds they sub-advise for as well as their own Odyssey funds. I'm not sure I'd invest in anything from PIMCO now, but it certainly would have worked out over the past 6.5 years.
    LLJB in Fund Discussions
  • Ouch Funds 2014
    MFLDX Down 5.56 ytd !!
    Derf
    Derf in Fund Discussions
  • How crazy would it be to implement this portfolio?
    40% PRIMECAP Odyssey Aggressive Growth POAGX
    60% PIMCO Income Instl PIMIX
    Since 1/1/2008 ~12.5% annual return vs S&P ~7% annual return
    2008 return -17% vs S&P -38% return
    Beat S&P 5 out of 6 years 2008-2013, YTD about even
    .55% expense ratio
    POAGX holds 30% Large/Giant Cap, 30% Mid Cap, 40% Small/Micro Cap, 14% non-US
    FWIW, POAGX is Morningstar 5 star Gold fund, PIMIX is Morningstar 5 star Silver fund
    JedClampett in Fund Discussions
  • Is Janus On The Mend ?
    FYI: This fund company is trying to right the ship.
    Regards,
    Ted
    http://news.morningstar.com/articlenet/article.aspx?id=662475
    Ted Ted in Fund Discussions
  • Bonds. The Intense Discussion Thread.

    @expatsp: EDV has a duration of 24.9 years! So if you are in that fund and interest rates go up 2%, the net asset value of that fund goes down by 50%. That's some serious stuff.......for that reason, I would never invest in anything like that.......well, unless we had a repeat of September 8, 1981, when the 10-year Treasury had a yield of 15.59%......remind me then, and I'll buy an extended duration Treasury!
    You can buy short term Treasuries, Intermediate term Treasuries, Long term Treasuries, etc. Or you can buy individual Treasuries at any place from less than one year all the way out to 30 years.
    I wouldn't count on people getting interest rate calls right, or any other predictions right, at least not on a consistent basis. They can certainly get a lucky one or two.
    Another option for fixed income money is to go with an online FDIC insured bank and accept anywhere from 0.87% at Ally Bank to 0.95%, and have instant access to your money, and total safety. Of course, that's all you are going to make. But it does diversify a portfolio that is 85% stocks.
    rjb112 in Fund Discussions
  • The Moose's New Signal
    The Moose’s New Signal
    The Moose has made a new call to EDV from ILF. By my math, ILF produced a positive return of about 5.4% for those that might have followed it.
    http://decisionmoose.com/Moosignal.html
    http://decisionmoose.com/Moosistory.html
    And, here is a news blurb form Bloomberg on emerging markets ...
    http://www.bloomberg.com/news/2014-08-25/most-emerging-stocks-fall-as-samsung-drops-while-sinopec-gains.html
    Have a grand day … and, most of all … I wish all … “Good Investing.”
    Old_Skeet
    Old_Skeet in Fund Discussions
  • The 'Investor's Dilemma': Everything Is Expensive
    FYI: Investing these days is like shopping at Neiman Marcus: Almost everything is expensive.
    U.S. stocks are hitting records. So are India’s and Argentina’s. U.S. junk-bond prices are high and rising. And it isn’t just risky investments that are up: So are the prices of conservative U.S. Treasury bonds.
    Regards,
    Ted
    https://www.google.com/search?newwindow=1&site=&source=hp&q=the+investors+dilemma+everything+is+espensive&oq=the+investors+dilemma+everything+is+espensive&gs_l=hp.3...1590.21855.0.22213.45.44.0.1.1.0.126.2026.43j1.44.0....0...1c.1.52.hp..14.31.1213.PEsUXvelbps
    Ted Ted in Fund Discussions
  • The Breakfast Briefing: U.S.- Europe-Asia
    FYI: The U.S. Breakfast Briefing will be up around 5:30 AM CDST
    Regards,
    Ted
    U.S. http://blogs.wsj.com/moneybeat/2014/08/25/morning-moneybeat-record-highs-are-nothing-to-fear/tab/print/
    Europe: http://blogs.wsj.com/moneybeat/2014/08/25/morning-moneybeat-europe-draghi-speech-to-prompt-gains/tab/print/
    Asia: http://blogs.wsj.com/moneybeat/2014/08/24/morning-moneybeat-asia-yellen-gives-the-market-little-to-trade-on/tab/print/
    Ted Ted in Fund Discussions
  • Bonds. The Intense Discussion Thread.
    I owned Fuss's LSBRX 2006-2013....but I wanted my bond fund to provide ballast, to go up when my stocks when down.......
    I sold my stake in LSBRX and bought SUBFX. So far that has been a poor decision, but my hope is that SUBFX will hold up well if the markets crash, and that's what I want from a bond fund. (I'm 85% equities, so I really need the bond funds in my portfolio to be bulletproof.)
    Then again, with its negative duration, I am beginning to fear that SUBFX will not provide much protection if the economy stalls and interest rates drop yet further, though I suppose its 50% cash stake will provide a cushion. Can anyone who understands bonds better than me comment on this?
    @expatsp, your thinking process was very sound. When you are 85% equities and looking for ballast, you don't want a fund like Loomis Sayles, because it doesn't accomplish your stated intent. On the other hand, if you were 85% Treasuries and looking for more risk and return, Loomis Sayles would have been a great choice.
    Below investment grade bonds can add diversification to a portfolio consisting primarily of investment grade bonds, like Treasuries, or the total bond market index. The same below investment grade bonds do NOT add diversification to a stock portfolio.
    Take a look at bond market performance during the financial crisis, say 2008. Stocks and below investment grade bonds both did terrible and were highly correlated. Treasury bonds did great. Look at the big recovery year, 2009. Stocks and below investment grade bonds again performed in sync.
    For your stated purpose, a reasonable choice would have been a Treasury bond fund. The highest quality bonds are the ones most likely to do what you stated, "to go up when my stocks when down." In a financial crisis there is a "flight to safety", and safety means Treasuries.
    However, now we have an extra issue to think about: interest rate risk. If a fund has a 6 year duration, then if the interest rate on those bonds goes up 2%, the fund will lose 12% in NAV, then add back in the yield to get the total return.
    But you comment is quite correct, "with its negative duration, I am beginning to fear that SUBFX will not provide much protection if the economy stalls and interest rates drop yet further"
    Let's wait to you read this to see if we want to continue....
    rjb112 in Fund Discussions
  • Hesitating On The High Board Of Investing
    In 35y I have never had conservative well thought-out plan (maybe cuz I ever had one?) be preferable to all-in. Unless you need the money soon, forget it, just do it and don't look back. Looking back causes all the heartache.
    davidrmoran davidrmoran in Fund Discussions
  • Why Its So Difficult To Raise Kids-And Save For Retirement
    FYI: My youngest daughter was born 21 years ago this week. At the time, I called an economist named Mark Lino from the U.S. Department of Agriculture, who told me to expect to spend as much as $300,000 to get her to age 18; toss in college costs, and it was well past $500,000 to get her to adulthood.
    Regards,
    Ted
    http://www.marketwatch.com/story/why-its-so-difficult-to-raise-kids-and-save-for-retirement-2014-08-22/print
    Ted Ted in Fund Discussions
  • Scott Burns: The Five Secrets To 'Happy Money'
    @PRESSmUP I've been linking Scott's article for years, he was big fan of Roy Weitz and FundAlarm. Here's what he had to say back in 2005
    Regards,
    Ted
    http://assetbuilder.com/scott_burns/an_interview_with_mr_fund_alarm
    Ted Ted in Fund Discussions
  • Ouch Funds 2014
    I have two funds underwater YTD out of 28 open end funds and ETF's that are on my crowded portfolio. Bringing up the rear are RYSEX at -1.36% and PRSVX at 0.99%. My top two are BRUFX at 15.25% and PRHSX at 16.28%. All these funds I've owned for several years.
    This year I started trimming some funds to keep my AA closer where I want it to be, which is 55% stock funds. I am an old guy at 64, retired, living off my investments. The trimming has been very gradual and gentle.
    Best wishes,
    Dave
    DaveSch in Fund Discussions
  • Ouch Funds 2014
    No. Got nothing down 5%! One is down. That's QRAAX, a "commodities futures derivatives" fund as best I understand it. It's down 1% this year. It won't do well until raw materials reverse their lethargic trend. And yes, I've added to it recently, but the investment is still very small - about 5% of total. (At $2.95 you can buy a lot of shares. A bit like having a fat wallet stuffed with $1s.)
    hank in Fund Discussions
  • Ouch Funds 2014
    BUFOX hammered ytd...negative 13.62%! Ouch!
    bee, it's ugly, but not as bad as the 13.62% figure, at least according to M*
    image
    rjb112 in Fund Discussions
  • Ouch Funds 2014
    Hi VintageFreak,
    I am thinking you are talking ytd on losing five percent or better. I have none that are ytd losers. My three best are TOLLX (+16.63%) ... THOAX (+13.705) & SVAAX (+10.29%). My three worst are LALDX (+1.97%) ... LPEFX (+2.35%) & ANWPX (+3.35%). Even my small cap funds have done reasonably well IIVAX (+4.24%) ... PCVAX (5.64%) & PMDAX (+7.54%).
    Old_Skeet
    No I meant I'm looking for funds doing badly, worse than 5% loss YTD. I mean if we have any funds losing 10% YTD but which are still "good" funds I would be interested in knowing as well. I used 5% just as way to start conversation. I want to allow for poor small cap performance this year so chose -5%.
    My HSGFX is down 3.4% I think. If he cannot hedge I'm going to tell and buy inverse S&P 500 fund. I don't have problem with his economics which is why I have persisted with him. What I can't understand is WTF he cannot hedge. Now, I'm straying off topic.
    So far then ARTSX is the only fund down more than 5% that Observers are holding?
    VintageFreak VintageFreak in Fund Discussions
  • Ouch Funds 2014
    Nothing here is down ytd by -5% or greater. I hold some of the same funds that I see David is holding. TRAMX is the best performer. Worst is PRESX TRP Europe, down -1.54% ytd.
    Crash Crash in Fund Discussions
  • Jason Zweig: The Decline and Fall Of Fund Managers
    Hi Ted,
    The fund that you mentioned (SHRAX) likely never made it to my candidates list way back in the early 1990s. I avoided front-end loaded mutual funds like the plaque that they are. I was reading John Bogle’s “Common Sense on Mutual Funds” in those days, and indeed agreed that costs mattered greatly.
    The front-loaded funds were immediately discarded by me from further consideration. I probably interviewed a half dozen financial advisors during that period, and every single one of them recommended portfolios populated only by these costly products.
    Our potential retirement war-chest was modest, and I was sickened at the prospects of reducing it immediately by a composite 5% to 6%. It would take years of positive outcomes to replace those unnecessary highway robbery charges. I still feel that way, but less so as my wealth substantially increased. Even then, I believe that I recognized that I was summarily tossing away some excellent fund managers.
    I do like Ricky Freeman’s record and his tenure. It is outstanding. He definitely is a talented and skilled stock picker. I am especially impressed by his low portfolio turnover numbers. The man makes his choices, and he stays the course with them. He sticks to his guns. Good for him, and the record shows that it is good for his investors too.
    Automatically discarding front loaded funds will eliminate some superior active fund managers. However, I suspect that from an overarching portfolio strategy, it probably does more good than harm.
    That’s more than a naked opinion since the cumulative fund management data consistently demonstrates that, on an annual basis, only 20% to 40% of active mangers outdistance passive Index management. Integrated over time, those numbers deteriorate even more, not including the upfront fee. It’s a hard uphill road to overcome fees, and the odds do not favor the individual investor.
    Thanks for your input.
    Best Wishes.
    MJG in Fund Discussions
  • Ouch Funds 2014
    My weakest funds are small value (Artisan SCV, Wasatch MCV) and my automatic investment in them remains unchanged, but no one meets the (5%) threshold.
    My strongest funds come in various flavors, led by emerging markets (TRP Africa & Middle East up 19%, plus Grandeur Peak EO, MACSX and Seafarer) but there's an inexplicable potpourri of others as well - real assets, global growth, midcap value. As with the losers, it's on auto.
    David
    David_Snowball in Fund Discussions