The challenge is to find persistence long term out-performance thru full market cycle. The The dominance of FANNG stocks in S&P500 is not easy to overcome. Perhaps the hurdle is lower in smaller cap funds.

It's really not that hard to beat the market. Simply BUY the funds in the smaller percentile that ALWAYS do.

OK, that's funny, like saying It's easy to get a 100 on a test. Just don't get anything wrong.

Hmmm...it's not intended to be funny, rather instructional.
What I'm saying is the funds that routinely beat their bogeys and/or the S&P are relatively easy to find because they pretty much do it ALL THE TIME.
FIND them. BUY them. Repeat.
HINT: Perform screens to identify the funds that are 5* funds for 3, 5 and 10 years, appear at/near the top of the screens in ALL of those columns and the 1-yr, YTD and Life of Fund columns. Dig a little deeper with your DD, especially regarding the PM(s), and select the very best.
Fido even assists investors by identifying "Fund Picks from Fidelity." You can probably even routinely beat their bogeys and/or the S&P if you just bought those.
But no, I'm not inclined to spoon feed them here. Several though are littered throughout my posts. If you swing and miss on one, not to worry as you likely blew away their bogeys and the S&P with the others.
Just don't EVER think you can pick THE ONE fund that's the best. Select 2-3 in each cat and if you did it properly, you very likely scored BIG on at least one or two of them. How many mistakes you think you could have made and STILL outperformed bogeys/S&P if you would have JUST bought and held FLPSX (see my prior post) from its inception?
Many investors have been coded to think that this is either impossible or will take too much of their time. And that's unfortunate.

Good point @sma3. Note also that it does hold 40+% munis and they are generally longer duration.
I don't like to engage in too much of the bond detail stuff, but it is a necessary evil of owning them. For those who do and may need a primer/refresher:
https://finance.zacks.com/effective-duration-vs-average-maturity-5206.html

M* portfolio lists PTIAX maturities with 30% over 20 years and 20% between 15 and 20 so likely duration is high

@JonGaltIII
Great post.
It's a tired old debate that at best provides confirmation bias to those who want to believe it or just don't want to try to beat the market.
To wit: I own 11 dedicated, actively managed stock funds. All 11 easily beat-to-blow away their bogeys. 10 of 11 do the same vs the S&P, the only one being a SCV fund that I bought last year. This scenario has been the case with my port for about 40 years now.
When I say blow away, I mean blow away....
I don't own it any more, but take a look at FLPSX, which I bought near its inception and owned (as my only fund for about five years circa early 90's and) all the way up to the last couple of years.
Value of $10K, 12/27/89 to Current:
VFINX: $208,480
S&P 500 TR: $215,986
FLPSX: $495,523
Note: There are no typos there and your eyes are NOT deceiving you.
True, LOTS of funds fail to beat their bogeys and many come nowhere close to matching the S&P. That's why statistically writers can truthfully pump out hair-on-fire (Thanks, Dick!) articles like these.
It's really not that hard to beat the market. Simply BUY the funds in the smaller percentile that ALWAYS do, or at least ALWAYS do over time.
Also, use of the word "NEVER" is usually not a good idea in these contexts. LOTS of PMs and analysts last year predicted Small Caps, Value, Foreign and EMs were places to be this year. So far, they weren't right, they were very right.

Thanks for sharing. If I understand the premise of the article - it's really about Index Funds vs. Active Management. It makes a compelling case for just investing in the S&P 500 Index and not trying to find the "hot hand" or chase a portfolio manager because they can't consistently beat the Index 95-97% of the time. It's what Warren Buffett is doing with his money when he passes away.
I understand the Index vs. Active discussion and I own some index funds. I agree that it's very difficult to have a portfolio that consistently beats the S&P over the long term.
Using MFO Premium ... let's take BFGFX as an example. The fund has been around for 14 years. It's +4.8 to the S&P over the life of the fund. It's APR has never trailed the S&P in it's history and last year it beat the S&P by 96.7 and +31.7 the year before.
Would it be safe to assume that this fund is part of the 3-5% that found a way to beat the S&P 500 Index (at least over the last 14 years)? What am I missing? Or is that the point? We won't be successful at trying to beat it over the long term. Genuine ?

i Guys,
We think deeply and often talk about our strategies to outperform the various markets, but our success rates are close to dismal. No, I’m wrong! They are dismal. Only about 5% of us manage to win this challenging task! Why?
We underestimate the many factors that both influence the complex marketplace while we consistently overestimate our abililiries to evaluate them. That is a recipe for disaster, and disaster is indeed the common ending. It seems like the less I try to outplay this game, the better I do. These days I just ignore the daily predictions and their predictors. This works for me. Trying harder generates poorer outcomes for me. What works for you?
Here is a Link to an article with a few insightful and interesting comments and statistics.
https://www.aei.org/carpe-diem/more-evidence-that-its-really-hard-to-beat-the-market-over-time-95-of-finance-professionals-cant-do-it/
I especially liked the following paragraph:” Similarly, over the 15-year investment horizon, 92.43% of large-cap managers, 95.13% of mid-cap managers, and 97.70% of small-cap managers failed to outperform on a relative basis.“
I wish you all successful investing and realize the huge odds against that global outcome. We can’t all be winners.

Hi Guys,
We think deeply and often talk about our strategies to outperform the various markets, but our success rates are close to dismal. No, I’m wrong! They are dismal. Only about 5% of us manage to win this challenging task! Why?
We underestimate the many factors that both influence the complex marketplace while we consistently overestimate our abililiries to evaluate them. That is a recipe for disaster, and disaster is indeed the common ending. It seems like the less I try to outplay this game, the better I do. These days I just ignore the daily predictions and their predictors. This works for me. Trying harder generates poorer outcomes for me. What works for you?
Here is a Link to an article with a few insightful and interesting comments and statistics.
https://www.aei.org/carpe-diem/more-evidence-that-its-really-hard-to-beat-the-market-over-time-95-of-finance-professionals-cant-do-it/
I especially liked the following paragraph:” Similarly, over the 15-year investment horizon, 92.43% of large-cap managers, 95.13% of mid-cap managers, and 97.70% of small-cap managers failed to outperform on a relative basis.“
I wish you all successful investing and realize the huge odds against that global outcome. We can’t all be winners.

Look closely at interest rate risk, usually measured by duration. Be wary of anything over 5 years avg duration. It is the reason I left a couple possible bond OEFs off my list.
Note that PTIAX does not publish its duration. Spoke to them years ago and was told the reason is basically to protect us average investors from ourselves. Interest rate risk is not completely/accurately measured by avg duration and the firm does not want its avg duration to be incorrectly interpreted as a measure of PTIAX's interest rate risk.
Disclaimer: LT owner of PTIAX and comfortable with whatever avg duration it has, albeit largely unknown.

My update - PTIAX and RCTIX is not available in TRP Brokerage. I am deciding between PIMIX, HSNIX and TRP's own PRSNX...I've owned PONAX in another account and they have receovered well from March 2020 volatility. Next, from what I can see the PRSNX seems to protect better on the downside and it's USD Hedge adds a unique wrinkle. The top performer in the past 3 & 5 years, HSNIX, seems to take the most risk and potentially protect less. Although it came roaring back...

Although, I no longer post on the MFO board I still visit and read it. The last time hank visited was December of 2020. His extended absence gives me pause. With this, I'll be keeping him in my thoughts and prayers. Hopefully, he will be back soon. Skeet
Here is a link to the last post made by hank. https://mutualfundobserver.com/discuss/discussion/57465/which-of-these-2-funds-is-riskier-safer-over-the-next-1-3-years-dodfx-vs-dodix

Well I watched WAITING FOR SUPERMAN, so I guess I'm now allowed to state opinions again. It throws a ton of different issues into the air, so commenting intelligently on them would take as long as the documentary. While some may choose to disagree, I saw a lot of things which agreed with what I was saying: Kids who are willing to work hard have involved parents, and who operate under reasonable levels of discipline; self-applied or otherwise, are likely to be successful. Others will tend not be. Pretty much what I said going in.
Yes, there are systemic problems. Yes, not all teachers are 'good', work hard, etc; just like any other field. The film strongly implied that unions were a major problem. Is it worth my time to point out that many of the very worst state educational systems (per the documentary) do not have unions while some of the best do? Is it worth noting to anyone that my home district, and the one in which I taught for twenty years, was 50% minority, provided free lunch to a huge percentage of its population, and was famously the inspiration for the NY Magazine article "Welcome to Newburgh, Murder Capital of NY".
https://tcf.org/content/commentary/welcome-to-newburgh-murder-capital-of-new-york/?session=1
Yet despite all of this, Newburgh integrated its schools by being one of the first NY districts to institute 'magnet schools'. While there were initially parochial schools; in time, ALL kids attended the public schools in Newburgh. People didn't flee because discipline was enforced and the educational program was superior to anything around. It was not uncommon for the very best students to graduate with a year of college credit. In my senior year, out of a class of approximately 1000, we ended up graduating 850; not the 300 and something suggested by the SUPERMAN documentary. Many of those who did not graduate chose to drop out as soon as possible and go to work. This was especially a problem with the latino population.
Tenure is proclaimed to be a problem, and it can be in some cases...but...one has to ask why, after three years of observing, a district gets itself saddled with a poor teacher? Can part of the problem be poor administrator oversight? Or maybe good candidates don't grow on trees and districts have to take what they can get? Why would that be? As for getting rid of tenured teachers, the hitch seems to be that you have to document the problem, and that seems to be difficult for administrators to do (which comes back to that oversight issue).
And if kids are being "passed along" and the school "failing" as a result, it's not the teachers doing it. In these cases, they are instructed to pass the kid along. Why would unions have any effect on THAT? If you abdicate your responsibility, have no standards, refuse to accept failure or impose consequences, how could you possibly expect a favorable outcome? We absolutely need to fix the system and get good people in there, but there is no simple and painless fix.

racq: "Thanks for the links; I'll take a look at the movie (documentary?)."
Yeah, documentary, like I said in my prior post...
The first was deeply dived into in the iconic, must see, 2010 documentary, Waiting for "Superman". Despite its critics, hard to express/expose the deep rooted issues and possible solutions any better than that.
https://www.imdb.com/title/tt1566648/
Pretty shocking to me that someone who made the previous post that you did, in which you stated
"David, if you're not a teacher (and have never been one?), you can't begin to argue the issue with any insight..."
is the same person who now states (in effect) he's not seen this landmark documentary.
So, allow me to say, please STOP posting anything else about this issue until YOU get up to speed on the now 10+ year old documentary that crystalized the US education system issues for the world.
BTW, I know probably 50 retired teachers and NONE of them has NOT seen this documentary. So you're the first.
This may all sound a bit "snarky" but here's the thing...I searched this thread for the one word that MUST appear in ANY discussion about the root problem(s) in order that I spend any real time on it. Amazingly, that word does NOT appear anywhere in this thread. If/when it does, I may engage in the discussion further.

To add to my prior post, I would suggest the first couple on my list (if you're interested in it) to look at closely for your stated purpose of diversification would be PTIAX and one of the HY munis. They will however NOT get you the global exposure you seek, but they will give you diversification.
Note that World bond and/or EM bond funds can be VERY difficult categories to do well in. I tend to get my little bit of foreign bonds via other bond bonds, NOT a dedicated World bond fund. DODLX, cousin to DODIX(?), may be one of your best options there.
https://fundresearch.fidelity.com/fund-screener/results/table/overview/averageAnnualReturnsYear3/desc/1?assetClass=TBND&category=IB,EB,XP,WH&mStarRating=4,5&ntf=&order=fundType,ntf,mStarRating

I'm confused by what is being debated here.
It seems that some may be concentrating on how to solve the BIG, LT education system issues, while others may be concentrating on the immediate, urgent need to address the issues of reopening schools due to COVID. I dunno, bit I do know my head hurts trying to determine that.
If so, I suggest that these are TWO vastly different issues and debates that, though not mutually exclusive, should be debated separately.
The first was deeply dived into in the iconic, must see, 2010 documentary, Waiting for "Superman". Despite its critics, hard to express/expose the deep rooted issues and possible solutions any better than that.
https://www.imdb.com/title/tt1566648/
The second is chronicled pretty nicely here:
https://www.future-ed.org/what-congressional-covid-funding-means-for-k-12-schools/
I do NOT want to get into this debate any further than to suggest reading that link and understanding that the bulk of the "money being thrown at the problem" in the next stimulus bill is primarily to combat the unique issues related to COVID, and IMO, essential to solving those issues. Solving the deep rooted education system issues is a whole 'nother story, and one that the average person who is/was NOT a teacher (or have a bio akin to mine), may not be fully aware of had they not watched the referenced documentary.

Crash asserted nonsense and I called him on it with substantiation. Then he started handwaving about a just society but calling for more flunking of kids.
Whatever.
Racqueteer, this may not be the best month to trot out the tired bootstraps argument yet again. It does remain perennially popular among some of us nonminority types, and even among some minorities too. Why can't everyone be like the Jews and the Asians and others similarly situated? What racism? What structural inequality?
As for my career, I have been a teen worker, HS teacher, university TA, and most recently sometime HS coach and sub. Also parent and grandparent. Also married to an elem-schoolteacher for a decade. I do know the gut feeling of being in a difficult classroom. It all can be very discouraging, not to say difficult to have insights about.
But I know that this is pernicious crap at the talk-radio level: 'You can't solve real, significant problems --- not at the root --- by throwing money at those problems.'

The problem, to me, with BOTH sides is the unwillingness to bend from some absolutist stance. To my way of thinking, everyone is entitled to a fair chance. That may entail more help to some individuals than others. Ultimately, however, good intentions aside, I can't MAKE someone do what is necessary to be successful. And, like the reality or not, the society in which one lives has a huge impact on the outcome. Money is almost certainly an issue, but attitude on ALL sides is as well. "Throwing money" at a problem isn't the same thing as properly funding productive strategies. If we as a society were actually serious about the issue, we'd have better pay in hard to staff districts than in affluent ones. We have just the opposite. Further, it would be more 'help' to struggling students to have classrooms which are orderly (disciplined) than not.
Having spent almost 30 years teaching mostly chemistry and physics in a heavily minority district, I know that I was drawing my classes from about half the population. Even THAT population was underperforming its potential; a situation which became WORSE over my career, Discipline issues became a greater and greater issue as time went by; since the schools didn't want to have 'bad statistics'. This despite the fact that, in a class of 1,000 students, there were probably only a dozen kids accounting for 75% of the serious instances. Instead of controlling THOSE kids, 'we' lightened up on enforcement and the problem spread.
I don't want ANY kids to fail, but the reality is that, if you set standards, SOME will not meet them. The 'solution' isn't to lower the standards so that EVERYONE 'succeeds'. If you don't end up actually KNOWING anything, how is that 'succeeding'? Anyway, by all means, make it possible TO succeed, but don't expect that you can make everyone DO it.

David, if you're not a teacher (and have never been one?), you can't begin to argue the issue with any insight.
Gotta admit, I stopped reading your post there.
Following that logic (?), do you also hold that if you've never played professional sports, you can't possibly be an insightful professional sports commentator, writer or analyst? Or is that somehow different? And if so, how?
Lemme know so that I can wash my brain of anything I ever learned from Vince Scully, Bob Costas, Tom Verducci, Paul Zimmerman...
Me, I went to school for ~20 years, have two relatives (both with PhDs) who taught for years, am married almost 45 years to a retired school teacher, live in a neighborhood overstocked with retired school teachers, and have audited the books of about 20-25 schools. But, OK, I've never been a teacher. Do I, and others with similar bios, also NOT have any insight on the issue?

Fair enough, Stillers; I made too sweeping a statement going in. I would suggest that the cases you cite involve people who either have, or have access to, direct knowledge of the field involved. I submit that opinions tend to be less valid if not supported by actual evidence and experience. If you could be bothered to go beyond that flawed introduction, I'd be interested in your thoughts.

Hello... 65% of Mama portfolio comprised of FBND. BND, fidelity2020 Fpifx, fidelitycash FCASH, and trp2020 funds TRRBX
She has many private bond corps from Ford att tmobile GM BAC
Btw most cash CD/ yields are extremely low now so unclear if these are good vehicles going forward
Kind regards

I just tried to purchase ITCSX at Schwab, and was told fund wasn't available at Schwab, so now I'm confused? Schwab does offer FLOTX which is one of the least risky Floating Rate Bond funds with $2500 minimum and transaction fee.