FYI: When you hear market strategists use the words “underweight” and “overweight,” what exactly do they mean?
Regards,
Ted
http://www.wsj.com/articles/what-is-underweight-or-overweight-in-the-market-1430709410

Hi Derf.
No accounting for survivorship-bias, unfortunately. Yes, it can detract from the ranking...bad fund, close it/merge it...raise your family score.
Ditto for category drift. Ditto for funds of differing ages. Funds of differing share classes. Funds mis-categorized. Funds with recent manager changes. Fund with different AUM. Funds with new adviser ownership.
All that said, I still find it a useful measure. But then, most rankings become a flash point for debate.
I think we beat the Turner anomaly to death in David's announcement post:
http://www.mutualfundobserver.com/discuss/discussion/20721/the-may-issue-is-up#latest
I'll close this post, so you can post further thoughts/feedback to that one.

FYI: Differences in the way indexes are weighted will make similar-looking funds diverge.
Regards,
Ted
http://www.wsj.com/articles/the-nonidentical-twins-of-etfs-1430709428

"Target-date funds have selected dates at which time the assets will be liquidated"
Once again we find a financial writer who doesn't seem to know what he is talking about.
Target date funds' dates refer to the general date of one's retirement. They tend to come in two varieties: one with a glide path that reaches its terminal allocation at the retirement date (e.g. 70/30 or 80/20), and one where the fund holds a gradually declining amount of equities for 10-15 years into retirement (in anticipation of a 25-35 year need). Either way, these funds are not liquidated.
There are two types of funds I'm aware of that are liquidated on a specified date (excluding UITs that pretty much by definition terminate). One type is target maturity bond funds, like the American Century Zero Coupon Bond Funds, or Fidelity's newer Defined Maturity Funds, or Guggenheim BulletShare ETFs. Here's a good Vanguard paper on defined-maturity bond funds.
Another type includes some managed payout funds. Managed payout funds are funds that are designed to work like annuities (if all goes well - they're not guaranteed). Some, like Vanguard's, are designed to pay out in perpetuity. Others, like Fidelity's Income Replacement Funds, are designed to terminate on a specific date. These funds hold a mix of equity and debt, and are liquidated on the specified date.
That subtype of managed payout fund is the only one I know that match the description of a "target date fund" given in the article here.

Hi bee,
A nice lower Standard Deviation combination throwing off some nice income, is a combination of VWINX and PONDX

Since 2008 that combination would have improved a stand alone VWINX portfolio:
(click on image to view more clearly)

bee, I *rarely* buy anything recommended by another as I like to do my own research/monitoring. But I must admit, much of the reason I had a good 2012 (better than the stock indexes and junk bonds) was entirely your doing. You were a vocal proponent of PONDX back then and I jumped aboard as it met my all my trendiness criteria. It was one smooth ride. So a belated thanks!

I believe CathyG...wherever she may be... was the first mentioned PONDX here at MFO. Investments work until they don't. This one has had some legs. Thanks to good management at Pimco (Dan Ivascyn).

As to your question the research on various tight stops on non volatile trending markets, open end junk bond funds in particular, and then when to reenter was given to me by a fellow poster here. He and I have been e-mailing back and forth on junk bonds for many years now. So not to sound like a ..., but wouldn't feel right sharing the fruits of his labor without his permission. The basics is when a heretofore strongly trending non volatile market declines a certain percentage from any new highs, there is a greater percentage that decline will continue further. I recall that methodolgy got me out of PONDX in 2013 with most of the early 2013 gains intact and it eventually went on to much further declines before stabilizing and rising again, albeit never as high as my exit point..

I'm not looking to get my kneecap bust so I'll stop you right there...thanks.

Good point John.
If you are reading this board (and therefore Ted's link) .... you probably shouldn't buy these funds.

I put 10% of a price target fund (an appropriate year) as a control on how I was doing.While probably not as capable as some on this site I suspect I am at least average. Some years I outperformed, other years I didn't My underperformance in recent years occurred for two major reasons. Too much in emerging markets in recent years and using more stable income than a bond fund. Both strategies were wrong in recent years/I think you have to be very capable to have a diversified portfolio that will outperform a decent target fund over a longish period of time

I know this topic has been tossed around numerous times on this board, but I'm always looking for suggestions on what to do with my cash. I'm 50 years old with more than $100,000 sitting in banks and credit unions earning about 0.50 % in interest. I know it will erode in value over time due to inflation, so I would like to beat that at the very least without taking a big risk with principal. I already have nearly $1M in a conservative portfolio (35% Bonds) (40% equities) (25% cash) so I'm looking to do something with a portion of the cash. Part of it should stay in an emergency fund, but I have about $100,000 that doesn't need to be used for at least 3-5 years. I call it "near cash." I've been looking at a few suggestions on the board, such LALDX, OSTIX and RSIVX. It appears that interest rates will be higher over the next few years so I do have to take that into consideration with any bond funds. Any other suggestions? Thanks in advance.

bee, I *rarely* buy anything recommended by another as I like to do my own research/monitoring. But I must admit, much of the reason I had a good 2012 (better than the stock indexes and junk bonds) was entirely your doing. You were a vocal proponent of PONDX back then and I jumped aboard as it met my all my trendiness criteria. It was one smooth ride. So a belated thanks!
As to your question the research on various tight stops on non volatile trending markets, open end junk bond funds in particular, and then when to reenter was given to me by a fellow poster here. He and I have been e-mailing back and forth on junk bonds for many years now. So not to sound like an ..., but wouldn't feel right sharing the fruits of his labor without his permission. The basics is when a heretofore strongly trending non volatile market declines a certain percentage from any new highs, there is a greater percentage that decline will continue further. I recall that methodolgy got me out of PONDX in 2013 with most of the early 2013 gains intact and it eventually went on to much further declines before stabilizing and rising again, albeit never as high as my exit point..

I guess Mr. Icahn was on vacation on another planet last June, when junk really was high-priced at a spread of 3.4 and yield of 5.2, versus 4.6 and 6.1 now. Is he confusing energy junk with the broader category? Maybe - lower down in the article, it sounds like he's worried about his energy investments.
Not to imply that HY couldn't take a fall anytime, like every other stretched asset in the land ...

Thanks for the link to a grand piece. It also had a link to the Wall Street Week show just before the 1987 crash, which I enjoyed now more than then. Marty was really expecting a bad day ...

I had read that article and while not necessarily disagreeing (Marty Fridson the junk bond guru feels likewise) markets don't usually top amid gloom but ebulience. It's encouraging that junk is outperforming not just everything in bondland in 2015, but many of the major stock indexes also.

Mark makes a very good point. Maybe I'm wrong, but my sense is we have very few "stay-put" type investors posting on this board. There's one notable exception (And I'd rather not go there, thank you.)
Don't mean to suggest we're a bunch of highly active market timers. That I don't know. On the other hand, I doubt many here have held mostly the same funds year-in and year-out for 15 - 25 years or longer without at least varying the allocations to each. I'll confess I haven't.

But then I am biased! Junk bond funds (PHYTX) are notable for their trend persistency and low volatility making them amenable to various trading methodologies using tight stops. Yes, I know 2008 was a disaster but the tight stop methodology would have kept you out of harm's way.

Comparing PHYTX to PONDX since Dec 2007 on a buy and hold basis the graph below shows PONDX produced similar returns with less than half the MAXDD. I would imagine tight stops would achieve greater upside gains while removing MAXDD entirely. Would you review with us the nuts and bolts of this strategy?

Thanks Hank.
So, right, Hussman just has four, but everyone has under-performed its peers over their lifetimes, although HSGFX is pretty much a push.
And Permanent Portfolio has three of four under-performers.
Here's the data...

Each has at least one Three Alarm Fund...

401k's

In a NUTSHELL:
For some asset classes, such as large US Stocks, DFA doesn’t seem to make much of a difference. DFA’s large company fund (DFUSX) is very similar to Vanguard’s 500 fund (VFIAX), although it charges a slightly higher expense ratio (10 basis points vs 5 for the Vanguard fund). The performance difference? According to Morningstar, DFUSX has had an average annual return (arithmetic) of 7.96% per year for the last ten years, compared to 7.94% per year for the Vanguard fund. Am I going to pay 0.37%, much less 1% to get DFA access to that fund? No way. For other asset classes, however, the difference is larger.

Thanks everyone for chiming in so far:

Also, you can invest directly with Icahn via Icahn Enterprises (IEP), although that's an MLP (so, K-1.) A substantial portion (I think 30% or thereabouts?) of IEP is in the Icahn hedge fund/s.
You can invest directly with Ackman via PSHZF (Pershing Square Holdings.)
Currently own neither, but just sayin' some alternatives.