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Post by FD1000 on May 21, 2023 13:35:33 GMT
These 2 funds have been great workhorses over the years. YTD: they both trail because Value stocks didn't do well. But wait, since 01-01-2018, over 5 years, Wellington is doing OK but Wellesley doesn't. 2018 was the start of higher volatility. Wellesley making just 0.5% YTD + only 22.3 total since 1-1-2018 is pathetic. In the Moderately Conservative Allocation Another fund to consider is FMSDX=Fidelity® Multi-Asset Income Fund. This fund is unique and a good diversifier. It has just 32% in stocks and the rest mostly in several bond categories. FMSDX beat both Wellesley for YTD + 1-5 years. For 5 years it did more than double. In the moderate allocation category: PRWCX has been my favorite moderate allocation fund for over 10 years. This fund has been a stellar performer ranking at 1-2% in its category for 1-3-5-10-15 years. FBLAX is also pretty good. Both are better than Wellington Below you see charts for YTD + 5 years. SPY(100% stocks)...VBIAX(60/40 indexes)....VWIAX(Conser allocation)...VWENX,PRWCX(Moderate allocation). Attachments:
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Post by yakers on May 21, 2023 14:29:31 GMT
Good chart, no one knows/knew in advance which fund would be the best although maybe not so hard to predict a good fund. I have the largest part of my $ at VG in various funds. In tax deferred I have Wellsley VWIAX and also had some Balanced VBIAX for many years, switched to Wellington VWENX early last year to get away from the indexed bond portion. In taxable I have VG Global Wellington VGWAX.
Then I have a Wells Fargo traring account with all kinds of cr*p in it. My WF managed account has not done better than my VG account although I wouldn't expect it to as it includes different assets like REITs and preferreds
Plan to simplify for my wife if necessary is put everything tax favored in Wellsley and everything taxable in Global Wellington.
Some fund will always do better, for many years and many years ago wifes 403b had Magellan fund, worked well for her at the time.
About the only major philosophical change I've had is to avoid indexed bond funds in rising rate environment.
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Post by yogibearbull on May 21, 2023 15:00:17 GMT
FMSDX is a good multi-asset fund with stocks-bonds-alternatives (in M* Other). Its bonds also have HY & EM. So, it may appear to be conservative-allocation (M* is easily fooled) from nominal %Equity, but it acts like moderate-allocation based on effective-equity & other volatility parameters (SD, beta). There have been several prior posts on FMSDX.
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Post by uncleharley on May 21, 2023 15:14:59 GMT
Is this a good time to focus on multi asset equities or would one do better by focusing on market leaders?
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Post by Fearchar on May 21, 2023 16:43:00 GMT
FD1000, PRWCX; TRowe Price Capital Appreciation is a good fund from a great family. However, I thought you were primarily a Gorilla Trader in municipals. Are you seriously considering a long term holding? I'm so bearish right now, that I'll be waiting a while before going long. Have never gone short, but would be tempted if market continues to rally.
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Post by FD1000 on May 21, 2023 23:07:59 GMT
Feachar,
I'm mainly bond OEFs investor, but I make comments on various funds/categories/subjects.
Since early 2022, all my trades were in HY munis funds. I never limited myself to only one category. In fact I may start buying others.
I don't short, my system is built on long or being in MM, it's easier to implement, at least for me.
I posted in early 2022 that I'm bearish and why I sold it all. 2022 was one of the easiest year to be bearish. I still did pretty well in 2022.
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Post by FD1000 on May 21, 2023 23:17:49 GMT
Yakers "no one knows..."
If you follow my system you will know. You don't guarantee the best funds, but you will be in top funds, and can't lagged too long.
I have been posting about PRWCX superiority over 10 years. Over the years I have found great funds.
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Post by retiredat48 on May 22, 2023 2:28:04 GMT
Good chart, no one knows/knew in advance which fund would be the best although maybe not so hard to predict a good fund. ... ,...thanks FD for the charts. yakers , ... many here will recall that five years or so ago, I was making various posts AGAINST WELLESLEY FUND...that it would be a poor performer, IMO and the reasons why. Thanks FD for clearly demonstrating this in your charts. I took quite a beating from forum posters back then. Huge Wellesley Fund following then. Not so many now. I also had urged posters to SPLIT their stock funds from bond funds, for various reasons, one being to allow more flexibility in dealing with a poor upcoming bond environment projected. I recommend same approach today. R48 |
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Post by daddymisc on May 22, 2023 10:47:01 GMT
Do you all think that bond funds return will improve once FED starts cutting the rates as expected in the near future (end of 2023/start of 2024)?
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Post by FD1000 on May 22, 2023 12:23:01 GMT
Good chart, no one knows/knew in advance which fund would be the best although maybe not so hard to predict a good fund. ... ,...thanks FD for the charts. yakers , ... many here will recall that five years or so ago, I was making various posts AGAINST WELLESLEY FUND...that it would be a poor performer, IMO and the reasons why. Thanks FD for clearly demonstrating this in your charts. I took quite a beating from forum posters back then. Huge Wellesley Fund following then. Not so many now. I also had urged posters to SPLIT their stock funds from bond funds, for various reasons, one being to allow more flexibility in dealing with a poor upcoming bond environment projected. I recommend same approach today. R48 Unfortunately, you made this statement about 10 years ago, not 5  . Another problem is the fact the bond funds lost a lot in 2022, who could forecast covid and high inflation after that, 5 years ago? But wait, flexible bond funds weren't great either. DODIX-a good, flexible, high-rated fund in the core plus bond category made just 1.9% average in 5 years. PIMIX, a very flexible bond fund, managed by the best FI team made just 2.5%. VBTLX=US tot bond index, made 1%. BTW, VWIAX doesn't invest in simple bonds, it invests in high rated corp, similar to VCIT. VCIT made 2.1% average in 5 years, and better than DODIX. Bottom line, VWIAX continues to do fine.
Most allocation funds didn't do well compare to the past for 5 years, because of the bond portion, while VOO(SP500) made 11% annually, which is its LT performance. But, bonds will return to "normal" because rates, and inflation will come down. |
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Post by retiredat48 on May 22, 2023 15:03:54 GMT
Do you all think that bond funds return will improve once FED starts cutting the rates as expected in the near future (end of 2023/start of 2024)? No...bond funds will improve way before actual rate cuts by fed. Markets look ahead. They don't ring a bell to begin investing in markets. Another alternative is fed keeps the current rate as-is for a year or two. Could happen if inflation remains very "sticky." Affect on bond market unsure, however, short term rates should remain favorable. R48 |
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Post by Mustang on May 22, 2023 20:07:38 GMT
Do you all think that bond funds return will improve once FED starts cutting the rates as expected in the near future (end of 2023/start of 2024)? Yes. But as was pointed out the market is forward looking. It will react if they think the Fed will cut rates.
A $1,000 bond with a 3.5% coupon rate will not trade at $1,000 if the market rate is 5%. The value of a bond is its market price plus the market value of its interest payments. A three year bond will trade around $958. Bonds with a longer time to maturity will trade lower. www.investopedia.com/terms/b/bond-discount.asp
As rates come down bonds will not be discounted as much and there value will go back up. Morningstar has a chart showing the bond fund's quality and interest rate sensitivity. Funds with limited interest rate sensitivity were not affected as much in 2022 as those with moderate or high interest rate sensitivity. It was there time to shine and their returns were higher. The opposite is also true. When interest rates go down they will lag the other funds.
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Post by FD1000 on May 22, 2023 20:55:41 GMT
Do you all think that bond funds return will improve once FED starts cutting the rates as expected in the near future (end of 2023/start of 2024)? Yes. But as was pointed out the market is forward looking. It will react if they think the Fed will cut rates.
A $1,000 bond with a 3.5% coupon rate will not trade at $1,000 if the market rate is 5%. The value of a bond is its market price plus the market value of its interest payments. A three year bond will trade around $958. Bonds with a longer time to maturity will trade lower. www.investopedia.com/terms/b/bond-discount.asp
As rates come down bonds will not be discounted as much and there value will go back up. Morningstar has a chart showing the bond fund's quality and interest rate sensitivity. Funds with limited interest rate sensitivity were not affected as much in 2022 as those with moderate or high interest rate sensitivity. It was there time to shine and their returns were higher. The opposite is also true. When interest rates go down they will lag the other funds.
It may be true about treasuries. Most investors don't own only treasuries. Good fund managers COULD know better what to do. M* can't predict flexible bond funds, even higher-rated bond funds with several bond categories and duration. On top of that, several bond categories react differently to different markets and why I never bothered to do any calculations or forecasts based on rates/duration. Since 11/2022, ORNAX made more than double VGIT. My last sell of HY Munis to MM was April 13. ( link) Quote" I sold all my bonds last night and back to 99+% in MM" |
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Post by johntaylor on May 23, 2023 16:05:39 GMT
Bought PRWCX in 1986. There were critics on the other forum who thought it was a typical balanced fund (without reading annual reports).
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Post by FD1000 on May 24, 2023 3:37:17 GMT
Bought PRWCX in 1986. There were critics on the other forum who thought it was a typical balanced fund (without reading annual reports). Years ago there was a guy on the board that invested a high % in PRWCX. We had several private messages, after I was sure that he understood it and its objectives, I told him that the reason I love to invest only in managed funds, is the fact that out of thousands of funds, there are several exceptional funds...and PRWCX is one them. While several great funds had great run for several years and then not so great, think PIMIX or SGIIX, PRWCX has been doing it for decades. |
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Post by johntaylor on May 25, 2023 13:37:34 GMT
Yep, also remember a guy on M* who was fond of that. If memory serves, we each had 3 or 4 m in.
My intro to the military was Fort Holabird, and the Baltimore Sun often had articles on T. Rowe.
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Post by saratoga on May 25, 2023 15:00:32 GMT
The thing is PRWCX did great even before Giroux. In any case, Giroux is young (47 or 48) and I will be happy to trust 25% of my portfolio with him.
I am slowly transferring fund from TIAA Traditional (paying 5.5% now) to TRAIX/PRWCX. I may reach 25% within maybe a year.
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