... for you see the sleeve Xrays out from a style orientation at 38% LCG, 22% LVB, 18% LCV, 7% MCG, 6% MCB, 6% MCV, 1% SCG, 1% SCB & 1% SCV. SPY Xrays out at 30% LCG, 30% LCB, 29% LCV, 3% MCG, 4% MCB & 5% MCV.

OS...since these funds are actively managed do you find that your xray data acts to tell you more of where you've been (rear view mirror) rather than where the fund is positioned for the future?
I would trust xray data for index funds, but is that really possible with actively manage funds?

"....One bond mutual fund in a portfolio may make sense, but it is difficult to imagine the value of more than two bond mutual funds....The market for large domestic stocks and the U.S. government bond market fit the index fund criteria. Small domestic stocks and emerging foreign markets do not. These markets have attributes that make intelligent, thorough analysis more likely to contribute returns that can overcome the cost of active fund management....Be sure you can justify adding mutual funds to your portfolio beyond eight. Make certain you need them, that they truly cover new ground in asset type, geography, or investment style, and that the addition is meaningful."
****************************
I recently cleaned house, and went from 13 down to 10 funds. One is wife's 403b, a miniscule holding in a small-cap index tool from Vanguard. NAESX. Holding a small-cap index fund cuts across the grain in the guidance offered in the article. But I'm very happy with the fund. Bond funds: PRSNX, DLFNX and PREMX. Years ago, I surely made a too risky and too big a bet on PREMX, but it did pay me handsomely, over time, after all. It also seems to me that depending on the sheer size of one's portfolio, the investor may very well need 15 or 20 funds. If I had $1M to invest, you can bet that I wouldn't shoe-horn it all into 8 funds.
This article reads very well and does not overwhelm ya with jargon that the uninitiated don't understand. But a true novice would still need to learn about some basic definitions, prior to making use of such an article. It was direct and straightforward. Thanks.

# I don't know, could count quick if I wanted to..... but Dollars, they are 50% of My Total.....That's enough, hardly add $ anymore (except Dividends reinvested), buy ETFs & individual stocks, no need to pay anymore Managers than the Good ones I Have...

Hi Mark,
I thought that your question was what was the Large/Mid Cap Sleeve benchmarked against? My answer was and still is the S&P 500 Index for you see the sleeve Xrays out from a style orientation at 38% LCG, 22% LVB, 18% LCV, 7% MCG, 6% MCB, 6% MCV, 1% SCG, 1% SCB & 1% SCV. SPY Xrays out at 30% LCG, 30% LCB, 29% LCV, 3% MCG, 4% MCB & 5% MCV.
Yep, I think I’ll continue to stick with the S&P 500 as the benchmark as from my perspective you have to look at the whole sleeve and not each fund as you site reference to.
That brings the question. Do you know why most church's have stain glass windows? It is because the different colors of glass represent the different perspectives and views of its members. Much the same here on the board ... We all, at times, have different thoughs, perspectives and see things in different colors.
Peace,
Old_Skeet

Old Skeet - well that's interesting because for the funds that you hold in that particular sleeve, M* uses the Russell 1000 as a benchmark instead of the S&P 500 except for HWAAX where they use the Russell Mid Cap Value Index. Two of your funds (BWLAX & VADAX) have over a 40% allocation to Mid Cap stocks so it is not totally a surprise that you've managed to best SPY during certain time periods. However, over the trailing 10-year time period, RUI as a proxy for the Russell 1000 has bested SPY for whatever value that information holds and RUI is also more in tune with the general composition of your funds than is SPY.
Maybe your comparisons work for you but if I was going to perform such an exercise I'd like mine to be closer to on the money. We're all just different I guess. No need to explain your reasoning.

The article was written by John D. Markese, president of the American Association of Individual Investors, and first published in April 1997. That's the "evergreen" part of the URL; reprints of what they consider classic articles. He wrote regularly but nothing popped out as deeply insightful (a phrase that might appear one day on my headstone).
If I read the attached article correctly, Mr. Markese currently makes $340,000 as a member of NASDAQ's board, but that figure might include compensation from serving on the board of C8 Venture Capital.
David

Hi Mark,
The Large/Mid Cap Sleeve in the Growth Area uses the S&P 500 (SPY) as its benchmark.
Year-to-date the Index trails and has returned 2.77% while the sleeve has returned 3.87%. For 2014 the Index bettered the sleeve 13.46% to 11.82% while in 2013 the sleeve bettered the index 34.97% to 32.31% and for 2012 the sleeve again bettered the Index 19.64% to 15.99%. Data from Morningstar.
Old_Skeet

Hi Mark,
Thanks for the questions.
Q 1) Yes (taxable & self directed ira accounts)
Q 2) Although it was posted in the front part of this thread ... I have provided it again below.
Here is a brief description of my sleeve system which I organized to help better manage the investments that were held in five accounts. The accounts consist of a taxable account, a self directed ira account, a 401k account, a profit sharing account and a health savings account plus two bank accounts. With this I came up with four investment areas. They are a cash area which consist of two sleeves … an investment cash sleeve and a demand cash sleeve. The next area is the income area which consists of two sleeves. … a fixed income sleeve and a hybrid income sleeve. Then there is the growth & income area which has more risk associated with it than the income area and it consist of four sleeves … a global equity sleeve, a global hybrid sleeve, a domestic equity sleeve and a domestic hybrid sleeve. An finally there is the growth area, where the most risk in the portfolio is found and it consist of four sleeves … a global sleeve, a large/mid cap sleeve, a small/mid cap sleeve and a specialty sleeve. Each sleeve consists of three to six funds (in most cases) with the size and the weight of each sleeve can easily be adjusted, from time-to-time, by adjusting the number of funds and the amounts held. By using the sleeve system one can get a better picture of their overall investment picture and weightings by sleeve and area. In addition, I have found it beneficial to xray each fund, each sleeve, each investment area, and the portfolio as a whole monthly. Again, weightings can be adjusted form time-to-time as to how I might be reading the markets and wish to weight accordingly. All funds pay their distributions to the cash area of the portfolio with the exception being those in my 401k, profit sharing, and health savings accounts where reinvestment occurs. With the other accounts paying to cash the cash area builds cash within the portfolio to meet the portfolio’s monthly cash distribution needs with the residual being left for new investment opportunity. In addition, most all buy/sell trades settle from, or settle to, the cash area.
Here is how I have my asset allocation currently broken out in percent ranges, by area. My neutral targets are cash 15%, income 30%, growth & income 35%, and growth 20%. I do an Instant Xray analysis of the portfolio monthly and make asset weighting adjustments as I feel warranted based upon my assesment of the market, my risk tolerance, cash needs, etc. Currently, I am neutral in the cash area, light in the income area and heavy in the equity area. I am thinking that once year end mutual fund capital gain distributions are paid out this will somewhat reduce the equity area and raise the cash area.
Cash Area (Weighting Range 5% to 25%)
Demand Cash Sleeve… (Cash Distribution Accrual & Future Investment Accrual)
Investment Cash Sleeve … (Savings & Time Deposits)
Income Area (Weighting Range 20% to 40%)
Fixed Income Sleeve: EVBAX, LALDX, THIFX, LBNDX, NEFZX & TSIAX
Hybrid Income Sleeve: AZNAX, CAPAX, FKINX, ISFAX, PASAX & PGBAX
Growth & Income Area (Weighting Range 25% to 45%)
Global Equity Sleeve: CWGIX, DEQAX, EADIX & PGUAX
Global Hybrid Sleeve: CAIBX, IGPAX & TIBAX
Domestic Equity Sleeve: ANCFX, CFLGX, FDSAX, INUTX, NBHAX, SPQAX & SVAAX
Domestic Hybrid Sleeve: ABALX, AMECX, DDIAX, FRINX, HWIAX & LABFX
Growth Area (Weighting Range 10% to 30%)
Global Sleeve: ANWPX, PGROX, THOAX, DEMAX, NEWFX & THDAX
Large/Mid Cap Sleeve: AGTHX, BWLAX, HWAAX, IACLX, SPECX & VADAX
Small/Mid Cap Sleeve: AJVAX, IIVAX, PCVAX & PMDAX
Specialty Sleeve: CCMAX, JCRAX, LPEFX, SGGDX & TOLLX
Old_Skeet

Hi Catch 22,
Thanks for your comment. I too, look often to see what a 50% bond/50% stock portfolio does.
After all, by best friend attempts to take only two fund (a bond fund and a stock fund) portfolio and tweak its allocation and better me. But, his portfolio only generates a yield of about two percent where mine is more than doubble that. At times, he will add a third deminsion and that is cash.
Bottom line, he has to do a little selling form time-to-time to make distributions to support his life style where I do not.
Since, I can not reference my portfolio at this time I am unable to report my five year return number from Morningstar. However, my brokerage reports are reflecting my total return including which includes my trading active at north of sixteen percent.
My best to you ... and, thanks for stopping by.
Old_Skeet

Hi Derf,
Thanks for the question.
From my perspective it takes the lot to make the whole. Lets take a six fund sleeve and in this case my large/mid cap sleeve in the growth area of the portfolio. In this sleeve I subscribe to the five percent min held but ideally place it more towards ten percent.
Since, I can not access my portfolio through Morningstar, at this time, I am not able to provide exact details. However, the largest holding within the sleeve is SPECX at about 25% followed by AGTHX and then all the way down to BWLAX which is the newest and smallest holding and currently represents about eight percent of the sleeve. The advantage of the sleeve is that when one fund falters then there are the others that are able to provide support and to continue to propel the sleeve as a whole. The large/mid cap sleeve itself represents about forty percent of the growth area and about eight percent of the overall portfolio. While the growth area as a whole current represents a little better than twenty percent of the overall portfolio. The global growth sleeve represents a little better than thirty percent, and both the small/mid cap sleeve and the specialty sleeve represent about fifteen percent each where these minority two sleeves only represent about three percent each of the overall portfolio they are a part of the lot of both the growth area and the portfolio as a whole.
If it got to the point that I was to start eliminating funds the small produces and those with the least amount of capital gains within each sleeve would go first.
I hope this helps answer your question.

Several years ago (2009-2010 period) a discussion with a couple in their late-60's came into place. They were frugal with their expenses, had modest pension income, receiving SS and had been investors otherwise for many years. They were nominally smart about choices for their investment side of life, and had a good understanding of market movements.
They had decided to smooth the ride with the investment side and downsize the portfolio. They were not trying the "shoot out the lights" with oversized gains in the marketplace, but enough gains to offset inflation and have a decent return after taxation. The plus for them was ease of monitoring.
At the time, the discussion mostly revolved around the point at the time, that "economies" were still very much in a damaged zone from the market melt of 2007 & 2008. The likelyhood that low interest rates (central bank stimulus) would have to remain in place for an extended period of time, in particular from the damage done to the private sector budgets; the regular wage earners and their ability to spend into the economy.
The choice was made to maintain a U.S. centered, simple portfolio. One could place this portfolio into the consevative or moderate allocation, depending upon one's view of such a mix (50/50). At the very least, one can not argue that the E.R.'s are too high (.05%/.08%).
The results are listed below using VTI and BND; which will find this portfolio at age 5 years, this July.
--- 2010 averaged return = 11.89%
--- 2011 averaged return = 4.39% equity market melt in July
--- 2012 averaged return = 10.23%
--- 2013 averaged return = 15.69%
--- 2014 averaged return = 9.25%
--- 2015 averaged YTD = 1.76%
M* 5 year anualized to date = 10.31%
They remained pleased.
Take care,
Catch

@ Old_Skeet: From time to time I've come across comments on this board that at least 5% of portfolio must be invested in a fund to make a difference to the total portfolio return. Viewing your portfolio, leads me to believe you think the opposite. Do you try to keep your holdings, within the sleeve, with close to the same % of invested dollars?
As for myself I lean toward to much cash on hand, but I like to sleep at night. I do have one fund FMIHX that contains over a 5% allotment of invested dollars. Total # of funds at this time 24, across 6 accounts.
And good investing to you,
Derf

Sounds like Skeet's willing to put more time and energy into tracking and managing funds than either I or most here are. Tracking is probably not too difficult, considering the sophisticated programs available today.
I've seen the arguments by some citing harmful effects from owning large numbers of funds. Their argument (sometimes bolstered with statistical data) is that duplicate holdings or off-setting holdings somehow adversely impact performance. I've never fully understood those arguments - nor have I investigated them very thoroughly. My admittedly simplistic response is that I'd be happy to own 15 funds just like PRWCX, but loath to own even one like HSGFX.
At one time I owned as many as 20. Have shaved that down to 11 plus an ultra-short, making 12 total. Two are held in both Roth and Traditional accounts, so am managing 14. In addition, we use a separate money market fund for household cash management.
I've never viewed this as an issue of which method promotes better returns. But I do like to keep things simple. For me anyway, having fewer funds makes it easier to maintain a perspective on how money is allocated. An additional benefit is that I find I do much less trading with the smaller number. Above all, it comes down to investor comfort. I'd no more criticize someone for the number of funds owned than for the size of car driven. To each his own.

@Old_Skeet: Let's see now!
1 Fund (SPY) + 2.77% YTD
53 Funds (???) +2.7% YTD
Regards,
Ted

Hi JohnChisum,
Thanks for stepping forward with your comment.
You are correct in your assumption that I Xray each sleeve to see how it is formulated and make changes within a sleeve, or sleeves, as I feel warranted.
Recently, I added another fund (#53) to my small/mid cap sleeve to get some foreign small/mid cap exposure that I felt was needed within this sleeve. I have found that it is easier to tweak changes by the sleeve over the portfolio as a whole. But, after I make changes within a sleeve I’ll then check the portfolio as a whole through Xray to see how the changes have blended.
While some may think that my high fund number count is way too high; it is what it is because it covers the holdings of five accounts not counting my bank accounts where a good deal of my cash is held. I have found my sleeve system to be a neat and cleaver way to combine it all together and know what one has. And, besides if one fund, or even a couple, fail to meet expectations then the impact is far less than one failing to meet expectations within a portfolio of say only a few funds. With my system if one fund in a sleeve falterns then there are the other two to five, perhaps six, to provide production and continue to propel the sleeve.
Although my performance for 2014 was not what I was seeking it boils down to my diversification. Sometimes diversification does that; but, my portfolio is designed to have something working most all the time. As a matter of fact I track it to see just how much of it is in the faster market current each week form a style, sector, and geographic orientation. Right now it is moving pretty well due to my foreign holdings as they seem to be moving faster than my domestic ones although domestic has had a few good weeks of late. In comparison, year-to-date I am up 2.7% while my bogey the Lipper Balanced Index (LBI) is up 2.3%. Last year I trailed my bogey but bettered it the three years prior. From my perspective, if I failed to better my bogey for a continued period of time and an on going basis then I'd be doing something wrong. With my system it is easy to make changes, monitor and measure against a benchmark. Most every sleeve has a benchmark with the exceptions being the cash and the specialty sleeves.
Where it has a rub, for a good number on the board, is that what I am doing is just not natural for those that seem to have issue with it.
It works for me; and, to me, that is what is of the upmost of importantance.
I wish all ... "Good Investing."
Old_Skeet

Old_Skeet can clarify this but I think when he is monitoring his portfolio he is doing it by sleeve. That way his attention is only to those funds within that sleeve and not the entire 53. Compare that to my portfolio with only 11 funds. I watch all the funds at the same time instead of 5 or 6 within a sleeve.
If someone were to hold a large number of funds like OS, the sleeve method is probably the best.

..."past 40 words/15 sec. you better get my ( and everyones) attention,"
Most intellectual duscussions are longer than 40 words or 15 seconds. No sound bites here at MFO.

I Read his stuff, some good stuff, too much Detail/information in one sitting for most readers....past 40 words/15 sec. you better get my ( and everyones) attention,
or else trash can.......

Old_Skeet: Suggest you E-Mail Tom Madell to see what he has to say about you 53 funds. I think I know what he's going to tell you. You are not an investor, your a fund horder.
Regards,
Ted

In this edition ...
-When You Should Consider Making
Changes to Your Portfolio (below)
-Are Bond Funds Likely to See Negative Returns
for the Remainder of the Year? (page 5, top)
-A Disappointing Note About
Morningstar.com (page 5, bottom)
Read all about it through the below link ...
http://funds-newsletter.com/mar15-newsletter/mar15-new.htm
Old_Skeet