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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.

Vanguard U.S. Value Fund (investor class) to be reorganized
https://www.sec.gov/Archives/edgar/data/836906/000168386320012215/f6527d1.htm
497 1 f6527d1.htm U.S. VALUE FUND MERGER
Vanguard U.S. Value Fund
Supplement Dated July 29, 2020, to the Prospectus and Summary Prospectus Dated January 31, 2020
Proposed Reorganization of Vanguard U.S. Value Fund into Vanguard Value Index Fund (collectively, the Funds)
The Board of Trustees of Vanguard Malvern Funds (the Trust) approved an agreement and plan of reorganization (the Agreement) whereby Vanguard U.S. Value Fund, a series of the Trust, would be reorganized with and into Vanguard Value Index Fund, a series of Vanguard Index Funds (the Proposal). The Proposal would consolidate the assets of the Funds and place U.S. Value Fund shareholders in a comparable fund with better historical long-term investment performance, deliver a large expense ratio reduction for U.S. Value Fund shareholders, and create a larger combined fund which we anticipate would achieve greater economies of scale.
The Proposal requires approval by U.S. Value Fund shareholders and will be submitted to shareholders at a special meeting to be held on or about January 22, 2021 (the Meeting). Prior to the Meeting, U.S. Value Fund shareholders will receive a combined proxy statement/prospectus requesting their votes on the Proposal. The combined proxy statement/prospectus will describe the Proposal, provide a description of the Value Index Fund, and include a comparison of the Funds. If shareholders approve the Proposal, and if certain conditions required by the Agreement are satisfied, the reorganization is expected to occur as soon as practicable after the Meeting.
Under the Agreement and after the closing, U.S. Value Fund shareholders will receive shares of the Value Index Fund in exchange for their shares of the U.S. Value Fund, and the U.S. Value Fund will cease operations.
We anticipate that the reorganization will qualify as a tax-free reorganization under the Internal Revenue Code of 1986, as amended.
Closed to New Accounts
Effective immediately, Vanguard U.S. Value Fund is closed to new accounts, and it will stop accepting purchase requests from existing accounts shortly before the reorganization is scheduled to occur.
© 2020 The Vanguard Group, Inc. All rights reserved.

TheShadow July 2020 in Fund Discussions
FPA New Income, Inc. limited availability to new investors as of August 1, 2020
Generally speaking, different years are good for some types of investments and bad for others. That's why 1994 is so interesting - little seems to have done particularly well.
Obviously 2008 was a disaster for equities, and serves to get one focused on bonds. Since junk bonds and to a lesser extent corporates tend to track equities, the further a fund strayed from Treasuries, the more likely it was to lose money that year.
To illustrate this, here's a chart for 2008 comparing intermediate Treasuries (VFITX up 13.8%), Treasury-laden IG market (AGG, up 6.2%), a good corporate bond fund (PIGIX up 2.2%), a corporate index (down 2.7%), and the average corporate bond fund (down 8.2%).
Shortening duration tempers swoons, so one is most likely to find funds that didn't lose money in 2008 either by investing shorter term or in government-backed securities. Another way to improve yield is to invest in MBSs that resemble these other bonds in duration and credit quality, but come with a higher coupon.
Using asset-backed securities in enhanced cash funds has a number of advantages. The interest rate risk or duration is similar to a money market instrument. The volatility of returns from interest rate moves should be fairly low, but a yield premium is available over money market assets.
https://www.ipe.com/enhanced-cash-and-the-naming-problem/25602.article
However, nothing comes for free. These higher yields have prepayment risk (negative convexity). That risk is somewhat hidden by the numbers and usually pays off. Until it doesn't. Look for threads along the lines of "XXX fund worked until it didn't".
One can even find MBS funds in the intermediate government category with won/lost records comparable to SNGVX Though for a variety of reasons I wouldn't personally use these "longer" term funds as cash substitutes.
SNGVX has an effective duration of 2.9 years and is full of GNMAs, FNMA's, etc.
PDMIX is called an intermediate term fund. It has an effective duration of 1.8 years and is full of GNMAs. Like SNGVX, it lost money in 2013: 2.37%. Outside of that, it's never had a losing year. But ... it only goes back to mid 1997. It wasn't tested in 1994. It also adds another layer of performance enhancement (and risk) with leverage.
VFIJX is also called an intermediate term fund. It has an even shorter effective duration of 1.0 years. Like SNGVX and PDMIX, it lost money in 2013: 2.13%. Unlike PDMIX it was around in 1994, and unlike SNGVX it did lose money that year: 0.95%, making its record 37-2 (it started in mid 1980).
With all these funds, it's a matter of taste. What sort of risks and of what size one is willing to take for what level of return. One gets different risk profiles by investing in different types of bonds. Then it's a matter of finding a good fund of that particular type.

msf July 2020 in Fund Discussions
FPA New Income, Inc. limited availability to new investors as of August 1, 2020
In "the never had a losing year contest" it's not meaningful to consider funds that did not exist prior to 2008 IMO.
IMHO the whole concept is an arbitrary numbers game. While I tend to agree with you about having an interest in 2008 performance, I'm more interested in 1994, when bonds lost almost 3% and stocks barely broke even. That's a real test.
Why should 365 days be special? (Well, except for every fourth year.) Even granting that one year is a useful period of time (not too long to make recoveries easy, not too short to get confused by random noise), what's special about January 1? If one is ascribing meaning to one year periods, ISTM that absent some meaningful rationale, looking at all rolling one year periods makes as much sense as looking only at calendar years.
As it turns out, AVEFX lost money over the 365 day period between 6/16/2003 and 6/15/2004. It lost a tad more over the 366 day period ending 6/16/2004 (counting Feb 29, 2004).
Why is avoiding any loss (but only over calendar year periods) no matter how small so critical? Is it better to make 0.01% in a MMF, or to make some measurable profit even if one loses 0.05% in one out of 23 years. That describes PMDRX. It has performed better than AVEFX with a smoother ride.
FPNIX started 4/1/1969. From then until the end of the year it lost almost 3%. Between the end of that April and the end of the following April (365 days), it lost nearly 11%.
From its launch to the end of the following April (i.e. its first 13 months), it lost over 5%. At nearly the end of November 1970, 1 2/3 years after launch, it was still down.
But none of this "counts". The 1969 loss doesn't count because that wasn't a full calendar year. The nearly two year span doesn't count because it doesn't align on calendar years.
All this is supposed to be "meaningful"?
Absolute negative screens have problems. This is not to suggest that one should disregard losses. But it's their magnitudes and frequency that matter, not the mere fact that a fund happened to lose a small amount over a particular 365 (or 366) day period.
How one weighs different factors is a personal preference. All I'm suggesting is that giving one factor (avoiding losses) infinite weight may not be as helpful as it appears.

msf July 2020 in Fund Discussions
FPA New Income, Inc. limited availability to new investors as of August 1, 2020
My goals at retirement are 6+% average annually with SD < 3 + positive annually + never lose more than 3% from any last top.
It seems to me that you jump around quite a bit with large sums of money into a few funds (mostly bond?) that are on a roll in terms of recent performance and low SD. Great that this seems to work for you, but I could not personally implement such a jumping strategy (if I'm correctly understanding your approach). I doubt the approach could work with a few buy and hold funds over the long term. Most would fail on the SD. Taking a quick peek, seems that SIUPX might come close to your criteria? (Avg 5.75 lifetime and SD of 2.9)

wxman123 July 2020 in Fund Discussions
Eastman Kodak stock price surge
LLSCX closed up 10.18% (or $1.85) tonight at $20.03 according to Schwab.

TheShadow July 2020 in Other Investing
Eastman Kodak stock price surge
Life After Death?
Check out this info on Kodak from the Wall Street Journal, in another MFO thread.

Old_Joe July 2020 in Other Investing
Life After Death? Kodak Shifts Into Drug Production
A current article in The Wall Street Journal is reporting that Kodak, with the help of a $765 million US Government loan, is metamorphosing into generic drug production. Following are pertinent abridged extracts from that article:

Onetime photography leader is shifting into production of drug ingredients using a loan provided under the Defense Production Act
Eastman Kodak Co. has won a $765 million government loan under the Defense Production Act, the first of its kind. The purpose: to help expedite domestic production of drugs that can treat a variety of medical conditions and loosen the U.S. reliance on foreign sources. Kodak’s loan has terms similar to a commercial loan and must be repaid over 25 years.
The loan is from the U.S. International Development Finance Corporation, a government agency akin to a bank, the officials said. The loan is the first of its kind under the Defense Production Act, which the Trump administration has previously invoked to speed the production of Covid-19 related supplies such as ventilators.
The onetime leader in photography sales is gearing up to produce ingredients for a number of generic drugs, including the antimalarial drug hydroxychloroquine that President Trump has touted in the treatment of coronavirus. Meanwhile, the U.S. is aiming to shift from relying on countries such as China and India, Kodak Chief Executive Jim Continenza and U.S. officials said. Mr. Trump in May issued an order allowing the DFC to financially support the “domestic production of strategic resources” for the coronavirus pandemic and “to strengthen any relevant domestic supply chains.”
Kodak will produce “starter materials” and “active pharmaceutical ingredients” used to produce generic medicines. “We have a long, long history in chemical and advanced materials—well over 100 years,” Mr. Continenza said. He added that Kodak’s existing infrastructure allows the company “to get up and running quickly.” Kodak is effectively changing gears, expecting its pharmaceutical ingredients to make up 30% to 40% of its business over time, and expects the loan to create around 300 jobs in Rochester, and 30 to 50 jobs in Minnesota.
For the U.S., the benefit of providing the loan to Kodak is to reduce reliance on other countries, particularly China, for drugs, DFC head Adam Boehler said: “We don’t ever want to be in a position, because of a pandemic, because of any reason,” that a foreign entity could upend U.S. access to medicines or pharmaceutical products".
China is the world’s biggest supplier of the raw materials—known as active pharmaceutical ingredients—that form the basis of medicines. That dependence on China makes shortages more likely should Chinese manufacturing be shaken, according to a 2019 U.S. government report. China’s dominance is growing: The U.S. imported $3.9 billion worth of pharmaceutical raw material from China in 2017, an increase of nearly one-quarter from the prior year, according to IHS Markit.
Rear Adm. John Polowczyk, who heads the White House’s supply-chain task force, said domestic drug production began shifting away from the U.S. in the 1970s, largely for reasons related to cost savings.
Peter Navarro, the White House trade adviser, said “This is not about China or India or any one country. It’s about America losing its pharmaceutical supply chains to the sweat shops, pollution havens, and tax havens around the world that cheat America out of its pharmaceutical independence.”
Personal comments-
• I believe that this action, supported by President Trump and Peter Navarro, is absolutely in the national interest.
RE: "domestic drug production began shifting away from the U.S... largely for reasons related to cost savings."
• Right. And of course those "cost savings" are reflected in the moderate and affordable drug prices that we see today. Let's try "largely for reasons related to increased drug company profits, at the expense of the national interest."

Old_Joe July 2020 in Other Investing
FPA New Income, Inc. limited availability to new investors as of August 1, 2020
If you want only funds that never lost money then performance could lag badly. PFNIX 10 years average annually is only 2% and that's a dismal bond performance.
I'd suggest you might have a typo, but you've assured us that whatever was posted, you meant what you said and you said what you meant, your numbers are true, 100 percent.
Still, given that PFNIX has only been around since 4/28/18, producing a 10 year average for that share class is a neat trick.
If one were to extrapolate PFNIX returns based on the performance of other share classes, one might arrive at a 10 year average return of 3.57% as of June 30th. That's far better that your 2%. However the shares, had they existed, would have lost money in 2011, 2014, and 2015.
Nor could it be that you conflated Pimco Low Duration Income Fund with Pimco Low Duration Fund, e.g. PTLDX. Because while the latter fund did average a bit over 2%/year over the past ten years, it too lost money. The annual performance graph below is from its prospectus.

If the game is simply to compare performance of funds that have never had a losing year.... AKRIX. I win! The metric in the quoted sentence was 10 year average annually. That would be 18.3%.
Silly cherry picking game.

msf July 2020 in Fund Discussions
Gold future
I didn’t mean to insinuate you did. I tried to answer your concerns thoughtfully about how oil impacts various commodity related funds. That’s all. Actually, you can go to M* or Lipper and look at the 1, 3, 5 year returns for those types funds if you’re looking for a short answer.

hank July 2020 in Other Investing
Gold future
@Sven Exactly. Easy to make a profit in ANYTHING if you invest at the bottom.
Corollary: Easy to lose money in ANYTHING if you invest at (or near) the top.

hank July 2020 in Other Investing
FPA New Income, Inc. limited availability to new investors as of August 1, 2020
One reason maybe that AVEFX ''flies under the radar'' is it is not available at Fidelity or Schwab no load/NTF.

In 2020 peak to trough AVEFX lost about 10% while FPINX lost only about 2%.
AVEFX has 20% in stocks FPINX < 1%
Vanguard VASIX is a better choice than AVEFX. See (
chart). VASIX ER=0.11%. It has better performance and SD(volatility) is close.

There may well be better choices for this TYPE of fund, but the criteria I was focusing on was never a down year. VASIX has had two, including down 10.53% in 2008. Not so pretty. AVEFX has an unbroken streak during its existence dating back to 2004.
If you want only funds that never lost money then performance could lag badly. PFNIX 10 years average annually is only 2% and that's a dismal bond performance.
AVEFX has a much better performance but 3.8-3.9% average annual return for 5-10 years are not good enough for me. At least VASIX performance annually is at 5.2-5.3% and Vanguard uses just indexes.
My goals at retirement are 6+% average annually with SD < 3 + positive annually + never lose more than 3% from any last top.

FD1000 July 2020 in Fund Discussions
Gold future
Would oil be a drag on a commodity fund?
Oil has been a tremendous boost for funds that invest in oil futures since the price went negative April 20. Over the past 3 months oil’s soared to over $40. I don’t even know how to compute such a phenomenal rate of return from -$30 to +$40. (maybe “a gazillion percent”?). The supposition behind @little5bee ‘s question must be that oil has entered bubble territory. :)
All the “cards“ seem stacked against oil from a casual viewer’s vantage point. Fracking, electric cars, shared vehicles, wind and solar, global warming / ecological related restrictions. What’s interesting is that with air travel off 50-75% during the pandemic and carriers mothballing aircraft, the price of oil has hung in there. So you have the eventual resumption of air travel to look forward to. Also, not all oil derived products are burned as fuel. Asphalt used for paving is one example. Lord knows we have plenty of roads in need of rebuilding.
There aren’t a lot of pure commodities funds. The ones that do exist play the futures markets thru derivatives. That’s expensive and risky. But who wants to take delivery or crude oil or lean hogs? I put a little in Invesco’s BRCAX shortly after oil fell below 0. This one’s the real McCoy as far as commodities funds go. The fund has done well since than. PRENX does not call itself a commodities fund. It invests in nat. resources, concentrated in refiners. Even its manager has suggested for at least 3 years now (in annual reports) that this fund is not currently a good investment, as he foresees a long bear market in the nat. resources area. I’m eager to read his next fund report to see if his thinking has changed any. PRAFX is as close as Price comes to having a commodities fund. It is less exposed to oil and appears to have a bit more in gold judging from its behavior.
Disclosure: I own all 3 of the above mentioned funds.

hank July 2020 in Other Investing
No surprise: Morningstar screw-up
I checked BRUFX this AM and found it to be listed at $582.78. Sometimes, I have noticed a change in mutual fund prices in checking prices before 7:00 pm eastern and then checking them again the following morning due to slow updates at M*. I'm not a paying subscriber at M* so it is something that I can live with. In addition, you can check a fund's price through it's fund company as well. Slow updates can be the result of a fund being invested in private placements which are more difficult to price over listed securities that trade on exchanges.

Old_Skeet July 2020 in Other Investing
No surprise: Morningstar screw-up
3 a.m. CDT Mstar shows $582.78.
If Mstar shows 0.00% 1-day return, that is a signal to come back later, or look elsewhere.
That's a VERY late update, and for my purposes, it does no good, because I'm looking and expecting to see the update in my "Portfolio Manager" list of holdings. THAT has NOT been updated. Harumph.

Crash July 2020 in Other Investing
FPA New Income, Inc. limited availability to new investors as of August 1, 2020
One reason maybe that AVEFX ''flies under the radar'' is it is not available at Fidelity or Schwab no load/NTF.

In 2020 peak to trough AVEFX lost about 10% while FPINX lost only about 2%.
AVEFX has 20% in stocks FPINX < 1%
Vanguard VASIX is a better choice than AVEFX. See (
chart). VASIX ER=0.11%. It has better performance and SD(volatility) is close.
There may well be better choices for this TYPE of fund, but the criteria I was focusing on was never a down year. VASIX has had two, including down 10.53% in 2008. Not so pretty. AVEFX has an unbroken streak during its existence dating back to 2004.

wxman123 July 2020 in Fund Discussions
No surprise: Morningstar screw-up
3 a.m. CDT Mstar shows $582.78.
If Mstar shows 0.00% 1-day return, that is a signal to come back later, or look elsewhere.

InformalEconomist July 2020 in Other Investing
No surprise: Morningstar screw-up
My holdings include BRUFX. M* shows it unchanged from the previous day, at $581.64. But elsewhere, I see it finishing today +$1.14, at $582.78..... So, Morningstar is convenient and wonderful--- unless it's wrong. Today, it's wrong... Which would make one think: what is RIGHT here? How does one know how reliable or unreliable it is, at any time, on any day.
So, Morningstar is forever a "definite maybe."

Crash July 2020 in Other Investing
Time to get jiggy with VWIGX?
There's been some talk, largely positive, e.g. Feb 2019 thread on int'l funds and the thread this month on swaps that paid off where some people wrote of swapping into this fund.
I've been taking a close look at this fund. You're looking at it as a somewhat lateral move from domestic to foreign. My interest is in moving foreign holdings a bit more toward the growth side. (Call that capitulation to growth if you will, but I'm viewing it as broadening my portfolio.)
When I look through blend/growth foreign large cap funds, a couple that keep turning up are BGESX (unavailable to retail investors) and SCVEX. One can get the lead managers of each of these at 40% of the cost (less with Admiral shares) with the Vanguard fund.
VWIGX has a fair amount of EM. For those who prefer to manage their own allocations, this can be problematic. For those who prefer delegating some asset allocation to their fund managers, the EM holdings are a good thing.
Cost is great, performance has been great. Much (not all) of that is due to this being a heavily leaning growth fund. That makes it high risk (does not do well in bear markets, and M* classifies it as high risk in what is already a high risk category). VWIGX can be purchased at various brokerages, albeit with a TF. VWILX must be purchased directly through Vanguard AFAIK.
So I've also been looking at other funds with a fair amount of EM, but blend rather than growth - with commensurately lower past performance and lower risk. Can't beat Vanguard on cost, though.
HDVYX - value leaning blend fund, submanaged by Wellington. A bit cheaper than most.
PSILX - straight down the middle blend fund (of funds). Has a small slice of PRIDX, a closed fund.
MDIDX - a growth leaning blend fund (of funds).

msf July 2020 in Fund Discussions
Time to get jiggy with VWIGX?
I'm liking this fund. VWIGX has had nice YTD performance and a great track record...International Large Cap seems to be unloved compared to US Large Growth. It has a low ER (.43)...ranks in the top 5% of the category for trailing returns (for every time frame from 1 month through 15 years).
Not mentioned much here at MFO...I wrote this back in 2016...might be worth a review:
https://mutualfundobserver.com/discuss/discussion/54980/favorite-over-seas-funds/p1

bee July 2020 in Fund Discussions
Gold future
The dollar’s tanking after decades of strength. Some of that relates to the Fed’s recent printing spree and some to our dismal failure dealing with Covid. Reminds me of the scattered bits I can recall from the late 60s and early 70s - several years before inflation really took off. Dollar down. Gold up. Repeat. Repeat. Nixon imposed wage and price controls in ‘70 or ‘71, although inflation wasn’t bad at that point compared to what it would be a few years later.
It’s not rocket science. We normally work for, trade in and buy things with dollars. When the value of the dollar falls, the price of what we buy goes up. However, the linkage isn’t real direct. Takes time for supply chains and consumer expectations to catch up. So don’t expect things to cost more tomorrow than today. In addition, the monkey wrench that is Covid has the economic picture so distorted now that it’s hard to get a good fix on relative valuations.
As for gold, I’ve seen it rise - and I’ve seen it fall - many times over my 70+ years. Pretty stuff too. It runs more on emotion than on fundamentals - although the fundamentals are currently in its favor. Some will get rich this time around. And some will get greedy and loose a fortune when the tide turns.
From Disney’s Beauty and the Beast: “A tale as old as time ...”
Just an added thought here - Conventional wisdom often links gold’s price increase with the current inflation rate. That’s a long stretch and normally not the case. Gold tends to move in sharp rapid movements like we’re witnessing. So at any given time, it’s racing ahead of or trailing inflation. Just a rough guess - but gold bullion looks to be up 20-25% over the past year. Miners are more volatile with many mining funds up 40% or more in the past year. Bad as inflation has been, it’s not running at 40% annually. However, over very long time frames it’s likely gold’s as good an indicator of the long-term inflation rate as would be real estate, lumber, tomatoes or coffee. Personally, I’ve some limited gold exposure, but I feel safer playing around the edges. Many real asset / commodity funds provide limited exposure to gold as does PRPFX. Some of the EM funds are nice indirect plays on the metals as well.

hank July 2020 in Other Investing