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.
Support MFO
Donate through PayPal
This Dividend Stock Strategy Is for Investors Who Want An Attractive Monthly Income Stream
Linked below is an interesting article that tells of three equity funds that provided investors a monthly income stream. One fund is geared towards domestics (SVALX), another is geared towards foreign stocks (IVFLX), and, yet, another is geared towards a global perspective (GVDLX). Old_Skeet owns the A share (SVAAX) version of SVALX. I'm now thinking of adding GVDSX which is the A share version of GVDLX.
I hope you enjoy the article because I found it to be a pretty good read.
Old skeet, I invested in IVFIX which had the same managers as SVAAX a few years ago and lost money. Bob C.had recommended this fund, but changed his tune as the fund slowly began to lose money. I wouldn'tinvest with those same managers again.
@Soupkitchen, I appreciate where you are coming from on IVFIX concerning making money. It consist of mostly foreign holdings and over the past "recent" years foreign stocks have not done as well as domestics. For me, I've been in SVAAX for more than ten years and my average annual returns have been better than ten percent per year. Not too shabby for a dividend fund! I'm now favoring GVDSX because it is 60% foreign and 40% domestic equity allocation plus it has better than a 4% yield. And, for the next few years it just might have a hard time keeping its head above water as other funds might as well. Perhaps, not. But, over the next ten years I'm thinking since it can mix foreign with domestic stocks there is a fit for it within my portfolio as the managers can adjust the equity mix based upon their read on the markets plus I collect a nice monthly dividend.
It is just hard to say with great conviction (since stocks and bonds are currently richly priced) where the best place is to position new money. However, in past years value has worked better, for me, than growth (although I have some growth positions as well). And, do you really want to buy fixed income at the moment due to the little yield bonds now offer investors? With this, I'm thinking that the equity dividend payers are the better place to be.
Currently, GVDSX is looking pretty good to me. I expect by year end it will become a member of my global equity sleeve found in the growth & income area of my portfolio (due to its yield) as I continue to focus on income investing and position new money towards income generating securities.
Hi sma3: Not taking issue with your comment. Though, I'm finding that GVDSX's inception date being 1/30/2017. So not sure where you came up with a five year retrun for it. Also, VWINX is a hybrid fund consisting mostly of stocks and bonds along with some cash. While SVAAX and GVDSX are all equity funds. As such ... you'd think that VWINX would have the higher yield? But, not so as VWINX has a yield of 2.91% while SVAAX and GVDSX have a yield of 3.52% and 4.02% respectively as per M*.
VWINX has been a good performer with a ten year average return of about 8.1% as compaired to SVAAX's ten year return of 10.25%. Again, GVDSX is a relative new fund that does not yet have a three year history. But, from my perspective, this goes to show that over the long run most equity income stock funds will out perform most hybrid income funds such as VWINX. What they seem to have in common is that they are advertised as income generating funds.
Kind'a like compairing apples to oranges and even to tomatoes even though two are of the fruit family and one is a vegtable.
From my perspective, to have a good diversified portfolio you need some of each.
Hi @Old_Joe: Yep, your right about tomatoes ... it's friut/vegtable ... thus it is a hybrid much like VWINX is a hybrid income fund while GVDSX and SVAAX are mostly all equity income funds with GVDSX having a global equity perspective while SVAAX is of more domestic one.
Yep, your right about tomatoes ... it's friut/vegtable ... thus it is a hybrid
Nope a tomato is not a hybrid. @Old_Joe is right. How, Botanically, can a tomato be both? People do refer to it as a vegetable for cooking purposes, I'll give you that.
Hi MikeM, Thanks for making comment. Googling ... Is a tomato a fruit or vegtable? Below is what came up with.
Is a Tomato a Fruit or a Vegetable? The age-old question actually has an answer—it's both! Tomatoes are fruits that are considered vegetables by nutritionists. Botanically, a fruit is a ripened flower ovary and contains seeds.
Thus, for me, it's a hybrid being both a fruit (for some) and a vegtable (for others).
Comments
It is just hard to say with great conviction (since stocks and bonds are currently richly priced) where the best place is to position new money. However, in past years value has worked better, for me, than growth (although I have some growth positions as well). And, do you really want to buy fixed income at the moment due to the little yield bonds now offer investors? With this, I'm thinking that the equity dividend payers are the better place to be.
Currently, GVDSX is looking pretty good to me. I expect by year end it will become a member of my global equity sleeve found in the growth & income area of my portfolio (due to its yield) as I continue to focus on income investing and position new money towards income generating securities.
With only 9 % turnover a year, the mangers are not doing much for their 0.7% fee.
VWINX has been a good performer with a ten year average return of about 8.1% as compaired to SVAAX's ten year return of 10.25%. Again, GVDSX is a relative new fund that does not yet have a three year history. But, from my perspective, this goes to show that over the long run most equity income stock funds will out perform most hybrid income funds such as VWINX. What they seem to have in common is that they are advertised as income generating funds.
Kind'a like compairing apples to oranges and even to tomatoes even though two are of the fruit family and one is a vegtable.
From my perspective, to have a good diversified portfolio you need some of each.
Good investing to all, Derf
Is a Tomato a Fruit or a Vegetable? The age-old question actually has an answer—it's both! Tomatoes are fruits that are considered vegetables by nutritionists. Botanically, a fruit is a ripened flower ovary and contains seeds.
Thus, for me, it's a hybrid being both a fruit (for some) and a vegtable (for others).