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Post by chang on Jan 17, 2022 12:45:42 GMT
I just noticed DODIX fell another 0.43% on Friday. What a pity I sold 90% of it and not 100% of it. I should have followed my impulse to get out of Dodge earlier and completely to the last dollar. Maybe on the next bump, unlikely as that seems, I will expunge and eradicate the last shred of it.
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Post by FD1000 on Jan 18, 2022 1:06:32 GMT
This is how I make my decisions. Every week I ask myself, suppose I have 100% in cash now, what are my best investment ideas? My top choices would be what I do next and why my decisions are quick and absolute.
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Post by chang on Jan 18, 2022 1:17:38 GMT
I have some more cash to deploy following my sale of LT holding APDYX last week. Dumping the last of my DODIX will increase this. My three go-to FI funds have been RPHIX, RCTIX and FFRHX … so I will probably put the proceeds here. Unless R48 and steelpony convince me to invest in CEFs…
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Post by Chahta on Jan 18, 2022 1:52:53 GMT
LOL. From the guy who just had 6 reasons not to.
I’m thinking of doubling my RCTIX up to my RPHIX amount. On the other hand this is starting to feel like an equity correction so a little extra cash could be good to have. I dunno.
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Post by roi2020 on Jan 18, 2022 3:03:58 GMT
In my 401(k), I've exchanged DODIX for a Stable Value fund late last year.
Outside of the 401(k), my other fixed income positions are RCTIX and VUSFX.
I've also purchased some I Bonds over the years but they aren't considered part of my investment portfolio.
This will be a challenging year for higher-quality intermediate-term (or long-term) fixed income.
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Post by acksurf on Jan 18, 2022 13:05:30 GMT
LOL - no love for DODIX
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Post by Chahta on Jan 18, 2022 16:37:49 GMT
Well it's funny. Many do love IT bonds for a long-term B&H portfolio. Not everyone trades enough to find "better" funds. Christine Benz holds up to 20% in her bucket portfolios. I would be interested what robo-advisors suggest today.
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Post by retiredat48 on Jan 18, 2022 22:21:37 GMT
The word of the past year, and likely going forward,is:.....CONVEXITY.
If anyone needs a link to it, speak up.
R48
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Post by retiredat48 on Jan 18, 2022 22:24:58 GMT
I have some more cash to deploy following my sale of LT holding APDYX last week. Dumping the last of my DODIX will increase this. My three go-to FI funds have been RPHIX, RCTIX and FFRHX … so I will probably put the proceeds here. Unless R48 and steelpony convince me to invest in CEFs… Why don't you buy some of either PDI or PDO, place it in your IRA...as a dry run to your eventual retirement. Reinvest dividends. Don't touch it. And with this divy dollar cost averaging, see if you do not get 8-9% a year total return, in the long run. And I don't recall, but auto divy buys may get a 5% price discount...on many CEFs. R48 |
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Post by fishingrod on Jan 18, 2022 23:03:07 GMT
Looks like 5% discount.
Vanguard does not participate in DRIPs Fidelity does I believe. Just for peoples info. Not a promotion.
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Post by chang on Jan 19, 2022 0:45:33 GMT
Closed another 0.5% down today. Fortunately I am now 100% out of this steaming pile of doggy poo.
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Post by Chahta on Jan 19, 2022 0:51:15 GMT
Looks like 5% discount.
Vanguard does not participate in DRIPs Fidelity does I believe. Just for peoples info. Not a promotion........
Schwab does participate and the good thing is they buy partial shares. The downside is they buy when they want and could be buying at a higher price than you like. |
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Post by chang on Jan 19, 2022 3:27:43 GMT
I have some more cash to deploy following my sale of LT holding APDYX last week. Dumping the last of my DODIX will increase this. My three go-to FI funds have been RPHIX, RCTIX and FFRHX … so I will probably put the proceeds here. Unless R48 and steelpony convince me to invest in CEFs… Why don't you buy some of either PDI or PDO, place it in your IRA...as a dry run to your eventual retirement. Reinvest dividends. Don't touch it. And with this divy dollar cost averaging, see if you do not get 8-9% a year total return, in the long run. And I don't recall, but auto divy buys may get a 5% price discount...on many CEFs. R48 I'll give it some thought retiredat48 , but if I did it would be in taxable not an IRA. I want my IRA's 100% stock for LT growth. Um, but after posting "Six Reasons Not To Own CEFs" I think I would be skewered if I did! Having said that, what about PAXS? It is supposed to be more real estate biased. Yet, conventional wisdom says that REITs perform poorly in a rising interest rate environment. Maybe this is not the time for PAXS? |
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Post by Chahta on Jan 19, 2022 13:28:56 GMT
Why don't you buy some of either PDI or PDO, place it in your IRA...as a dry run to your eventual retirement. Reinvest dividends. Don't touch it. And with this divy dollar cost averaging, see if you do not get 8-9% a year total return, in the long run. And I don't recall, but auto divy buys may get a 5% price discount...on many CEFs. R48 I'll give it some thought retiredat48 , but if I did it would be in taxable not an IRA. I want my IRA's 100% stock for LT growth. Um, but after posting "Six Reasons Not To Own CEFs" I think I would be skewered if I did! Having said that, what about PAXS? It is supposed to be more real estate biased. Yet, conventional wisdom says that REITs perform poorly in a rising interest rate environment. Maybe this is not the time for PAXS? Heck, you can put a CEF in your taxable account and use it periodically for tax loss selling...... Eenie meenie miny moe, just pick another for wash sale avoidance..... |
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Post by Deleted on Jan 19, 2022 13:44:47 GMT
Isn’t it more tax-efficient to put equities in taxable and fixed income in tax deferred, at least until we do away with favorable tax rates for dividends/gains and stepped-up basis? Are you trying to avoid capital gains distributions from managed funds?
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Post by Chahta on Jan 19, 2022 14:25:38 GMT
It could be more about growth and reinvestment avoiding taxes in a TIRA with many years until RMDs start. Max growth especially in a Roth.
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Post by chang on Jan 19, 2022 17:26:32 GMT
It could be more about growth and reinvestment avoiding taxes in a TIRA with many years until RMDs start. Max growth especially in a Roth. That’s it exactly: I want my biggest LT growers in tax deferred. At today’s yields, bonds aren’t really tax inefficient because they don’t yield anything. |
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Post by retiredat48 on Jan 19, 2022 18:15:29 GMT
It could be more about growth and reinvestment avoiding taxes in a TIRA with many years until RMDs start. Max growth especially in a Roth. That’s it exactly: I want my biggest LT growers in tax deferred. At today’s yields, bonds aren’t really tax inefficient because they don’t yield anything. It's not what bonds in general are yielding; it's what PDI and PDO yield, and that is 7.5% to 9.5%. So c'mon Chang, let's do some math. Here's what to do: In IRA, sell $30,000 of low yield max growth fund. No tax due. Buy $30,000 PDI in IRA. Dividend of about $2700 annually. No taxes due. Reinvest dividends, meaning annual dividend likely to increase. In taxable accounts, sell $30,000 from a low paying bond fund...or use cash. Buy only ETFs. Buy a zero or low divy income, max growth ETF, to counter what you sold in the IRA. ETFs have deminimus cap gains annually. Your dividend is small, let's say 1/2%. At 24% bracket, you pay $150 X .24 = about $37. Negligible. In essence, the ETF performs like a mini-IRA. Don't waste paying $2700 X .24 in taxes in taxable account. R48 |
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Post by fishingrod on Jan 19, 2022 18:52:59 GMT
Again not promoting PDI, but it is very, very tax inefficient. According to M* it has a 5 year tax cost ratio of 4.30 out of a pretax return of roughly 10%. That is hefty and belongs in a tax wrapper I believe.
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Post by FD1000 on Jan 19, 2022 22:53:32 GMT
Closed another 0.5% down today. Fortunately I am now 100% out of this steaming pile of doggy poo. OMG, I just read it and laughed my pants off for 5 minutes while my wife is looking at me and wondering what the heck. Shhh, don't tell anybody, PDI, another -1.3% today. In 2019 PDI income was $10,975 + 2020=$10425 + 2021=11516... Total=$32916 in 3 years. Let's think about it rationally. In the last 3 years( link): if you invested $100K, PDI paid you a total income of about $33K. You must be very happy, unless you realize PDI total performance was only 18.7%(let's round to 19%). You actually didn't get $33K, PDI only made 19% = Total return. The other $14K came from your own money, meaning, they used your initial $100K to give you back another $14K....am I right? Wait, you are going to miss the great monthly poo...and, since the price is down, you are getting a bigger % of poo...basically, the more the price goes down, you get a higher % because the pile of poo gets smaller...until you really do a simple math. In just 3 years( link). Total returns...PDI=18.7...SPY=100%. While in America, they call it fuzzy math, in my old country we call it FATA MORGANA |
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Post by retiredat48 on Jan 20, 2022 4:15:51 GMT
I don't fully get your post, FD.
I think I read from your post that PDI only returned 19% (total return) in last three years.
So while you cherry-pick the time period, what's wrong with 19% in three years. This is a bond fund, for heaven's sake, not a stock fund. And I could cherry-pick a time frame of a few months ago, where it is now likely that by years end, PDI will have beaten the pants of SPY.
Compare apples to apples. How many standard issue, vanilla bond fund holders got 19% total return in last 3 years. FI performance is what counts.
R48
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Post by chang on Jan 20, 2022 12:19:05 GMT
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Post by retiredat48 on Jan 20, 2022 18:20:08 GMT
I'm not getting a fund for symbol PAXS....?? At least not on stockcharts.
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Post by fishingrod on Jan 20, 2022 18:30:32 GMT
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Post by chang on Jan 20, 2022 18:37:53 GMT
I'm not getting a fund for symbol PAXS....?? At least not on stockcharts. See the ML article … it should commence trading any day now. |
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Post by chang on Jan 25, 2022 18:23:07 GMT
PAXS should launch by the 26th. |
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Post by retiredat48 on Jan 26, 2022 1:00:45 GMT
PAXS should launch by the 26th. Yes...I got the info...a new fund. I can't take the time to fully assess now, as we are in my usual peak investment and posting time period--January. Lot's of action. BTW most CEF investors avoid buying FI CEFs at the IPO price, as they usually go to a discount in time. PIMCO maybe an exception. I currently own a bunch of PIMCO CEFs, and adding another is not necessary unless a switch seems warranted due to portfolio makeup and yield. I will follow PAXS. R48 |
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Post by mozart522 on Jan 26, 2022 13:43:27 GMT
I don't fully get your post, FD. I think I read from your post that PDI only returned 19% (total return) in last three years. So while you cherry-pick the time period, what's wrong with 19% in three years. This is a bond fund, for heaven's sake, not a stock fund. And I could cherry-pick a time frame of a few months ago, where it is now likely that by years end, PDI will have beaten the pants of SPY. Compare apples to apples. How many standard issue, vanilla bond fund holders got 19% total return in last 3 years. FI performance is what counts. R48 I tend to agree with FD1000. Only two things are important in investing; total return and the risk you take to get it. So labels like "bond fund" or "stock fund" are meaningless in that context. So PDI has a much lower TR compared to VTI since PDI inception approx 10 years ago BUT PDI has a higher SD, a lower best year, a much higher worst year, a much higher max drawdown, and lower Sharpe and Sortino. "How many standard issue, vanilla bond fund holders got 19% total return in last 3 years." Or how many vanilla bond fund holders suffered through over 14% SD and max drawdown of 32% in the last 10 years? In short, PDI seems like a bond fund that has metrics of a risky stock fund without the compensating returns. Another example, to me, of those who can be blinded by yield. Moz |
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Post by Chahta on Jan 26, 2022 14:30:21 GMT
I tend to agree with FD1000 . Only two things are important in investing; total return and the risk you take to get it. So labels like "bond fund" or "stock fund" are meaningless in that context. So PDI has a much lower TR compared to VTI since PDI inception approx 10 years ago BUT PDI has a higher SD, a lower best year, a much higher worst year, a much higher max drawdown, and lower Sharpe and Sortino. "How many standard issue, vanilla bond fund holders got 19% total return in last 3 years." Or how many vanilla bond fund holders suffered through over 14% SD and max drawdown of 32% in the last 10 years? In short, PDI seems like a bond fund that has metrics of a risky stock fund without the compensating returns. Another example, to me, of those who can be blinded by yield. Moz for income. The TR, grow your portfolio to the max (or at least to provide an income stream) approach is a very valid way to invest. FD1000 does it well. But so is set it and forget it taking 9% each year for income. Just not totally my way of doing it. I am somewhere in between. |
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Post by mozart522 on Jan 26, 2022 15:29:48 GMT
I tend to agree with FD1000 . Only two things are important in investing; total return and the risk you take to get it. So labels like "bond fund" or "stock fund" are meaningless in that context. So PDI has a much lower TR compared to VTI since PDI inception approx 10 years ago BUT PDI has a higher SD, a lower best year, a much higher worst year, a much higher max drawdown, and lower Sharpe and Sortino. "How many standard issue, vanilla bond fund holders got 19% total return in last 3 years." Or how many vanilla bond fund holders suffered through over 14% SD and max drawdown of 32% in the last 10 years? In short, PDI seems like a bond fund that has metrics of a risky stock fund without the compensating returns. Another example, to me, of those who can be blinded by yield. Moz The TR, grow your portfolio to the max (or at least to provide an income stream) approach is a very valid way to invest. FD1000 does it well. But so is set it and forget it taking 9% each year for income. Just not totally my way of doing it. I am somewhere in between. But if one took $900 per year (9% of original 10K) adjusted for inflation from both VTI and PDI, at the end of the approx 10 years, VTI would have a CAGR of 8.71% and PDI of 5%. VTI would have $22,256 in its account and PDI would have $15,951 or about 40% less. And none of that changes the much higher risk metrics for PDI over the last 10 years. My point being, that income is what I create to spend and it can come fro dividends, TR or both. But in my mind, the measure of an investment is how much I get for my risk. Plain IG bonds don't give me much right now but don't have 14% SD either. Moz |
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