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Post by yogibearbull on Feb 3, 2021 13:37:55 GMT
chang , Sharpe Ratio uses SD in the denominator, Sortino Ratio uses Downside_SD [using data points below the average only; see the formula below]. Both are within the M* categories, so cannot be used for comparisons across the categories. SD^2 = SD_upside^2 + SD_downside^2 If the data are symmetric wrt the average, SD = 1.414 x SD_downside. Then, Sortino Ratio = 1.414 x Sharpe Ratio.
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Post by fred495 on Feb 3, 2021 14:07:43 GMT
chang said a few days ago: "To repeat what I said above: I find the MS category disappointing. It should rise above all the others, but in fact it doesn't. The average MS fund is overpriced and underperforms IMO. If most MS funds don't seem to capitalize on their flexibility, then I would just as soon own low cost, best-in-class municipal, IG corporate, HY and maybe NT bond funds. And that's what I do."
If you don't mind sharing, chang, I am curious what has prompted your sudden interest in MS bond funds like those you mentioned in your previous post, i.e., TSIIX, PTIAX and RCTIX?
I know you said that you are "Still very far from convinced it makes sense to buy", but these three funds happen to be well represented in my portfolio, hence my curiosity. This is not a "gotcha" question.
Thanks,
Fred
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Post by chang on Feb 3, 2021 14:45:15 GMT
fred495 My interest was triggered by rising cash levels in different accounts, and a desire to be sure that I'm not missing anything. I am trying to rein in duration, and have most of my FI in VUSFX. Hence, it makes sense to review the NT and short-duration MS space. So far, my plan is to stick with VUSFX, at least while equities continue to soar, soar, soar.
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Post by Chahta on Feb 3, 2021 15:16:15 GMT
Pardon my tone of familiarity and friendliness, but it appears that chang is still in the accumulation maintenance phase and not income phase of portfolio management. I believe that the better MS funds being discussed here could be a B&H for many in the income phase. I very much like the "4% rule of thumb" for income generation and MS funds that have that type of yield that makes it easier to not sell shares. Just one thought about MS funds. ST funds make sense as ballast to be able to rebalance at opportune times. Each fund type works for different reasons. I realize that income talk irritates some others but it is a fact of life to use portfolios as income at some point for most of us.
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Post by rhythmmethod on Feb 3, 2021 15:28:44 GMT
chang Personally, I still give the nod to PTIAX. Why? - Lower correlation to equity market (tends to zig when stocks zag); - Higher credit quality (mostly "A" and above bond ratings); - Reasonable combination of yield, total return, and volatility, resulting in good Sortino Ratio (if you care). My Yugo is better than the others. View Attachment Norbert idea works also for me. At this time, I am liking the MS field. I tilt that with BSV and EDV depending on which way the wind blows. I'm heavy PIMIX but will be shifting to include, and perhaps tilt toward PTIAX depending on taxes, different account balances, etc. I now have my Fidelity account up and running. When I was very FI heavy I was/am holding PDIIX. I feel less need to hold that currently, with increase in equity values, and will probably start to exchange that on diplets for VGWAX/VWIAX/VTMFX depending on which account it's held in. Thanks for the thoughts here.
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Post by Karen on Feb 3, 2021 15:53:10 GMT
Pardon my tone of familiarity and friendliness, but it appears that chang is still in the accumulation phase and not income phase of portfolio management. I believe that the better MS funds being discussed here could be a B&H for many in the income phase. I very much like the "4% rule of thumb" for income generation and MS funds that have that type of yield that makes it easier to not sell shares. Just one thought about MS funds. ST funds make sense as ballast to be able to rebalance at opportune times. Each fund type works for different reasons. I realize that income talk irritates some others but it is a fact of life to use portfolios as income at some point for most of us. Not to be picky, but my husband used to work in the field. There are three phases to investing: Accumulation, Maintenance and Distribution. (Some investors never reach the second or third phases despite taking voluntary or RMDs, meaning, their ports continue to grow/accumulate through DOD.) All of those phases can use either/both a Total Return or Income/Yield investing strategy.
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Post by Chahta on Feb 3, 2021 16:23:29 GMT
Pardon my tone of familiarity and friendliness, but it appears that chang is still in the accumulation phase and not income phase of portfolio management. I believe that the better MS funds being discussed here could be a B&H for many in the income phase. I very much like the "4% rule of thumb" for income generation and MS funds that have that type of yield that makes it easier to not sell shares. Just one thought about MS funds. ST funds make sense as ballast to be able to rebalance at opportune times. Each fund type works for different reasons. I realize that income talk irritates some others but it is a fact of life to use portfolios as income at some point for most of us. Not to be picky, but my husband used to work in the field. There are three phases to investing: Accumulation, Maintenance and Distribution. (Some investors never reach the second or third phases despite taking voluntary or RMDs, meaning, their ports continue to grow/accumulate through DOD.) All of those phases can use either/both a Total Return or Income/Yield investing strategy. Agreed Karen. Good post. Mine was really about the point of MS bond OEFs.
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Post by anitya on Feb 3, 2021 18:15:26 GMT
rhythmmethod, Could you pl expand on your thought on implication of taxes w/r/t PIMIX vs PTIAX? Having never invested in PTIAX, I am curios what percentage of its distributions have generally been tax-exempt. A
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Post by rhythmmethod on Feb 3, 2021 19:11:47 GMT
rhythmmethod , Could you pl expand on your thought on implication of taxes w/r/t PIMIX vs PTIAX? Having never invested in PTIAX, I am curios what percentage of its distributions have generally been tax-exempt. A Hi, anitya, it's pretty inelegant, I'm afraid. In March/April I basically sold some stuff, at the worst time, as I feared a bigger melt-down. It also coincided with all my tours, etc. cancelled until further notice. At some point I just threw a pile of $ in PIMIX, just to do something. Both in sheltered and non-sheltered accounts. As it turned out anything bot in March/April did pretty well. It left me an excess of PIMIX, which I've been whittling down. I just opened an account at Fidelity where I can purchase PTIAX (it's not avail at Vanguard) So, as I replace some PIMIX with PTIAX I'm mindful about cap gains on PIMIX in the non-sheltered. I don't think it is more tax efficient than PTIAX, though it may be a little. Fast forward to fall of this year, my virtual work took off more than I ever expected, so I was left with more $ to invest in equities, which I did. So basically, I'm re-arranging deck chairs to include subbing some PIMIX for PTIAX.
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Post by anitya on Feb 3, 2021 19:20:12 GMT
Thanks, RM. May be Norbert and others that own PTIAX can let us know if they received any tax-exempt distributions from PTIAX (from its MUNI sleeve). My guess is it invests in taxable MUNI bonds but no personal experience here.
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Post by FD1000 on Feb 3, 2021 19:31:33 GMT
Pardon my tone of familiarity and friendliness, but it appears that chang is still in the accumulation maintenance phase and not income phase of portfolio management. I believe that the better MS funds being discussed here could be a B&H for many in the income phase. I very much like the "4% rule of thumb" for income generation and MS funds that have that type of yield that makes it easier to not sell shares. Just one thought about MS funds. ST funds make sense as ballast to be able to rebalance at opportune times. Each fund type works for different reasons. I realize that income talk irritates some others but it is a fact of life to use portfolios as income at some point for most of us. I usually can find bond funds for most goals, nothing is perfect or guarantee and it gets harder to find in this environment. The 3 NonTrad funds I mentioned PMZIX,MNCPX,PUTIX can be a good risk/reward hold in the next several years because there is a chance they will make 3-4% annually + lower SD + better performance than high-rated funds. PMZIX,MNCPX also have 30 day sec yield over 2.5%, the last 12 months yield > 3%. The next is PTIAX with better performance potential + higher SD and 30 day sec > 4%.
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Post by fred495 on Feb 3, 2021 21:43:52 GMT
Thanks, RM. May be Norbert and others that own PTIAX can let us know if they received any tax-exempt distributions from PTIAX (from its MUNI sleeve). My guess is it invests in taxable MUNI bonds but no personal experience here.
From the Fidelity site for PTIAX:
As of 12/31/20, municipal tax exempt bonds are 25.68% of the fund's portfolio, and taxables make up 16.44%.
From M*:
PTIAX's 1-year tax cost ratio is 1.61, and PIMIX's is 1.99. For 3 years it's 1.65 for PTIAX and 2.19 for PIMIX.
Good luck,
Fred
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Post by steadyeddy on Feb 4, 2021 1:23:11 GMT
What do you all think of an ETF from Columbia Threadneedle... "DIAL" ?
Monthly rules based MONTHLY rebalancing into 6 segments of fixed income... with 28 basis points Expense Ratio... $800M+ AUM with a 3 year track record? 6%+ total annualized return
1. US Treasury 2. Global Treasury 3. IG Corp 4. HY Corp 5. MBS 6. EM Debt
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Post by FD1000 on Feb 4, 2021 4:28:18 GMT
What do you all think of an ETF from Columbia Threadneedle... "DIAL" ? Monthly rules based MONTHLY rebalancing into 6 segments of fixed income... with 28 basis points Expense Ratio... $800M+ AUM with a 3 year track record? 6%+ total annualized return 1. US Treasury 2. Global Treasury 3. IG Corp 4. HY Corp 5. MBS 6. EM Debt DIAL is a pretty good choice among Multi but doesn't fit the OP. See table attached. Attachments:
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Post by steadyeddy on Feb 4, 2021 13:35:06 GMT
What do you all think of an ETF from Columbia Threadneedle... "DIAL" ? Monthly rules based MONTHLY rebalancing into 6 segments of fixed income... with 28 basis points Expense Ratio... $800M+ AUM with a 3 year track record? 6%+ total annualized return 1. US Treasury 2. Global Treasury 3. IG Corp 4. HY Corp 5. MBS 6. EM Debt DIAL is a pretty good choice among Multi but doesn't fit the OP. See table attached. Thanks FD. Other than DIAL, are you aware of any ETFs for MS bonds that are pretty good as well?
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Post by FD1000 on Feb 4, 2021 16:34:14 GMT
I'm not. I usually don't look at ETF but this one popped several months ago when I looked and MFO database. I ran it again for 3 years, see attached and got FIXD+BYLD. BYLD isn'tgood enough but FIXD looks pretty good. Then I ran PV( link). I don't like either one because of their volatility. See last attachment
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Post by chang on Feb 5, 2021 12:37:26 GMT
Any thoughts about why TSIIX keeps 13-14% cash? If they deploy this, then average duration etc. will go up and credit quality etc. will go down. A high cash stake distorts the statistics.
Drilling down into this fund and seeing some things here to like. Less impressed with PTIAX (3y alpha, Sharp and Sortino all below the same stats for its own benchmark).
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Post by Chahta on Feb 5, 2021 13:30:12 GMT
Possibly they were flooded with new money. Or the "cash/cash equivalents" are duration control. The fund owns 10 stocks too. Possibly they are looking for the right opportunities.
I'm not following why credit quality would go down or duration up. Doesn't it depend on the assets purchased?
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Post by Chahta on Feb 5, 2021 23:10:50 GMT
I'm not. I usually don't look at ETF but this one popped several months ago when I looked and MFO database. I ran it again for 3 years, see attached and got FIXD+BYLD. BYLD isn't good enough but FIXD looks pretty good. Then I ran PV( link). I don't like either one because of their volatility. See last attachment FIXD+BYLD are IT core+ funds per M*. DIAL is a MS fund.
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Post by chang on Feb 6, 2021 2:12:39 GMT
Possibly they were flooded with new money. Or the "cash/cash equivalents" are duration control. The fund owns 10 stocks too. Possibly they are looking for the right opportunities. I'm not following why credit quality would go down or duration up. Doesn't it depend on the assets purchased? I was assuming cash is counted as zero-duration and AAA-credit quality (as if a money market, which the "cash or cash equivalent" probably is ... see "Thornburg Capital Management" under "Others" here). I could be wrong; perhaps the stats refer to the non-"cash/cash equivalent" holdings only. Either way, the difference would not be that big. But I prefer my funds (of any type) to be close to fully invested. I don't like cash hoarders. This fund does, however, appear to be an interesting investment in terms of duration and yield, and on paper offers meaningful active management and flexibility. Whether it warrants consideration over cheaper alternatives isn't clear to me yet.
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