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Anyone have the skinny on this fund? Never owned a convertible fund and wondering if it is a better foil for equity funds vs bond funds in current times.
I do not own the subject fund you are asking about; but, I do own a convertible securities fund FISCX and hold it in my hybrid income sleeve. It is mostly made up of bonds that have the option to convert to common stock at the bond holders choice usually at maturity or at an established date. In addition, the fund holds some convertible preferreds as well.
Year-to-date the fund is up 11.5% and is the leading member of it's sleeve. Generally, I like to keep about 10% of the sleeve's money in convertibles and because other sleeve members usually hold some convertibles as well from time-to-time I have to sometimes throttle the weighting of FISCX to maintain a 10% convertible securities weighting within the sleeve.
In addition, I strive to keep an overall portfolio weighting of about 5% in other assets as classified by Morningstar's Instant Xray of which convertibles securities fall.
Perhaps, the above will be helpful if you are looking for ideas as how to incorporate a convertible securities fund within your portfolio. Perhaps not.
When I Xrayed WSGCX it came up as a Wells Fargo fund. Why do you favor this fund? I'd run from anything with the name Wells Fargo on it as the bank's ticker symbol WFC in my book means "We Fleece Customers."
LOL. I did the same thing. I'm sure you made typo and typed WSCGX.
Will check out FISCX. Hopefully I don't make a F.I.S.T. out of things.
The reason to check out the Westwood fund is because is strikes me as being more risk averse. Of course it has not been through a bear market, but FISCX lost like 35% in the last one. A fund like this I'm not expecting to trade, but then a fund I don't expect to trade I cannot take that much loss.
Fixed-income managers who value the mantra "do not lose money" will tell you that preferreds are horrendous values now, with prices much higher than the face value. Given that most preferreds have deep call features, it is hard to understand the logic in paying 15-35% premium for a preferred now, and have it called at face or perhaps at a small premium in the near future. Yes, the prices could continue to escalate, but a number of smart managers will tell you that if there is a bubble in the fixed-income markets, this is it. In a credit crunch, these will not be pretty, as another poster noted.
Comments
Here is how I use my convertible secutities fund.
I do not own the subject fund you are asking about; but, I do own a convertible securities fund FISCX and hold it in my hybrid income sleeve. It is mostly made up of bonds that have the option to convert to common stock at the bond holders choice usually at maturity or at an established date. In addition, the fund holds some convertible preferreds as well.
Year-to-date the fund is up 11.5% and is the leading member of it's sleeve. Generally, I like to keep about 10% of the sleeve's money in convertibles and because other sleeve members usually hold some convertibles as well from time-to-time I have to sometimes throttle the weighting of FISCX to maintain a 10% convertible securities weighting within the sleeve.
In addition, I strive to keep an overall portfolio weighting of about 5% in other assets as classified by Morningstar's Instant Xray of which convertibles securities fall.
Perhaps, the above will be helpful if you are looking for ideas as how to incorporate a convertible securities fund within your portfolio. Perhaps not.
When I Xrayed WSGCX it came up as a Wells Fargo fund. Why do you favor this fund? I'd run from anything with the name Wells Fargo on it as the bank's ticker symbol WFC in my book means "We Fleece Customers."
My best to you ...
Old_Skeet
Will check out FISCX. Hopefully I don't make a F.I.S.T. out of things.
The reason to check out the Westwood fund is because is strikes me as being more risk averse. Of course it has not been through a bear market, but FISCX lost like 35% in the last one. A fund like this I'm not expecting to trade, but then a fund I don't expect to trade I cannot take that much loss.
Maybe convertibles may not be for me.