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.
With the exception of Treasuries, bonds have never been 'safe' investments. And now long-term Treasuries might be the un-safest of all. There has always been risk investing in bonds, including inflation risk, interest-rate risk, issuer risk, and o…
Rest assurred that if Arnott ends the year with a loss, there will be more than a few investors head for the exits in search of the next 'guru'. Every great manager has 1-3 year periods when their style/outlook/specific holdings are out of favor. …
Lists, schmiths! Every freakin' publication or commercial web site does this. And all of them use their own screens to create what they tell people are the funds to buy NOW. In early 2009, investors were running for exits. It did not matter that…
Yes, there has been some positive inflows into the U.S. markets. But the fact is that very little of the money pulled out of bonds in recent months has gone into stocks of any kind. If you add the trillions of dollars that were yanked out of stock…
I do agree with others that a diversified EM stock fund offers much less specific risk. On the other hand, there are some funds that have an overweighting to LA stocks. The MSCI EM Index has about 16% in LA. Ivy Asset Strategy New Opportunities I…
I am not sure there is much that is not 'growthy' when it comes to Latin America funds. We have used several over the years, none currently. Diversified LA funds are pretty much dependent on what happens in Brazil. Mexico comes into play some. 1…
He has been a snarly old guy for decades, even before he was old. There is nothing warm and fuzzy about Mr. Bogle. He does raise good points, but they're the same ones all the time. Until you get folks who are willing to take on the responsibilit…
I like the idea of unconstrained bond funds, but I also believe having some dedicated dollars in foreign/em bonds is logical. I do not believe that we are going to see truly high interest rates in the U.S. ANYtime soon. Heck, we will be lucky if t…
For me, the jury is still out. These ratings are supposedly predictors of long-term future performance. Anything can happen over a 1-2 year period of time. There are a bunch of so-called gold ratings that have gotten smashed in the last couple of…
Michael Aronstein has had a short on emerging markets for some time. It hurt him a bit last year, but has really helped in the recent selloff. Having something like MFLDX in the toolbox can be a prudent decision. A 5%-15% weighting, depending on …
Immediate fixed annuities have some attraction, particularly for those people who do not participate in a federal, state, or local pension system. There is no question that the assurance of a check coming each month provides peace of mind. But wit…
With all due respect to our fearless host, Mr. Snowball, the answer is yes. Having worked at three universities in my previous life, I can assure you that 1,000 PhDs CAN be wrong. It's not referred to as Piled Higher & Deeper for no reason. T…
Yeah, with the exception of index foreign and some em funds, and some munis, it was an ok day. Emerging market bonds had a great day, with local currency funds gaining about 1.5%. And it looks like foreign developed and EM stocks will have positiv…
Sometimes what works on paper or spreadsheets or computer models doesn't go as planned in real life. Many of these 'risk parity' funds have target max drawdowns, some of which are very close to being breached I would bet. We have not used this fun…
How many times have we heard this sort of bleak prediction for EMs? Every time there is a selloff of EM stocks, this gets trotted out by someone. It would be nice if some of these so-called Asia experts would acknowledge that China is no longer an…
We have used Artisan ARTMX and Ivy IYMIX for quite a long time, and they have been good to us. They have modest turnover ratios, reasonable expenses, and experienced and smart managers. ARTMX is more of a team management, but Andy Stephens has bee…
You know, this whole thing of 'rising interest rates' may have some truth to it, but for those of us who bought our first houses in 1979 or 1980 or 1981, it's almost laughable to look at current mortgage rates and read comments that any movement hig…
PFIUX and HAUBX are run by the same PIMCO manager. There are some differences, but the general philisophy is the same. The folks running MWCIX are actually TCW managers. And the SUBFX team has extensive experience, also. Both of these funds are …
Reply to @ron: I am less concerned about this issue if the fund has a flexible mandate and if I know the management viewpoints and how it might change as rates rise, if they have not already done so. I would be REALLY concerned if the fund was not …
We took a very long look at Whitebox Long-Short. They purport to have an absolute return strategy, but their numbers have simply been too wild for us to consider. The kind of risk they are taking is not at all what we want for absolute return. Ta…
You ask a very prudent question. The direct answer is "yes, we are still putting dollars in bond funds." The details are much more obtuse. As you know, we have been avoiding long-term treasuries for more than 2 years (yeah, we were cautious too s…
Wasatch Long-Short FMLSX stayed above the fray, and most basic materials/resources funds had a plus day. And mining stock funds were up as much as 2-3%. Mind you, I am not suggesting you rush out and buy one.
To date, I have seen nothing to indicate any problems at all. Artisan continues to have a very strong group of managers. Except for their emerging markets fund, all the others have done a good job of balancing risk and reward. We have owned ARTMX…
While I realize that all of the statistics are useful in deciding how you are invested in different sectors and the kind of risk you are taking on by each sector, I would not spend time trying to analyze whether you are allocated appropriately in ea…
M* knows very well the games fund companies play with its star ratings. And they will gloat all the way to the bank as firms market their 'gold, silver, bronze" analyst ratings, too. Even T Rowe Price has an add saying something like 75% of their …
While I realize that it is pretty obvious that the Fed is going nowhere on short-term rates for probably at least the next 12 months, I remain cautious. The domestic bond funds we use have pretty flexible mandates, and managers have taken advantage…
The reason someone might own PAUIX is for the manager's ability to drastically change allocations at any time. PIMIX does not have that option. It must own bonds. That's fine if you are looking for a bond fund. But it does not offer any kind of …
Mr. O'Neill has been a pretty good futurist, and I would not dismiss his suggestion that emerging markets will continue to drive world growth over the next decade. The changing trade patterns he outlined were particularly insightful. These give cr…
We have not changed our fixed-income sleeve. Our overall bond allocation target for most client accounts is about 50% domestic and 50% foreign. Included in the mix are OSTIX, LSBDX, BSIIX, GSZIX, TGBAX, GSDIX, and GIMDX. For cash substitutes we u…
Reply to @ron: Hi ron. While it may not be totally logical, we are sticking with short to medium-duration bonds for the most part. Except for our muni bond funds, our average durations are very modest. LSBDX has reduced its duration to 4.7. And …
You raise some great points, MJG. It is probably that I am more attuned to market news than most other MFO members, since it is my business after all. I have Bloomberg/Google Finance/Money CNN open most of my working day, from 6:30 AM to 4 PM. Bu…
The Fed would LOVE to be in a position to being increasing short-term rates. But with employment wheezing and very little inflation (both of which numbers a lot of people believe are manipulated by the government), and even more importantly, with t…
Reply to @MourningStars: Thanks, MourningStars. You translated my comments very well. My only other comment is that as I have observed our federal government over many years, there is clearly no effort to make any really hard decisions. The polit…
Alternatives to cash should, by definition, have darned low risk potential. I have been unable to find any information on RPHYX average duration and maturity. They might be very short, which would be good. But without that information, I would be…
It is interesting that the more 'developed' countries become, the more cradle-to-grave goodies they provide their citizens. This leads to higher and higher debt, deficits, and lower growth. Seems like something pretty easy to notice, but darned ha…
Agree, Mark. Just like how the government turns backflips when it reports employment and CPI numbers. Unfortunately, much of the media swallow the pablum, even though they know it is skewed. And now the feds want to change how inflation is measur…
I have looked at PERM as a substitute for PRPFX. The expenses are not much different (PRPFX is 0.69%, PERM is 0.49%), certainly not a deal breaker, and PRPFX has lowered its costs in each of the last 5 years. The red flag for me is that PERM alloc…
