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Post by Karen on Jul 10, 2023 17:28:58 GMT
We invest heavily in PRWCX and FBALX. They are our two highest conviction Allocation funds.
We are interested in possibly adding one more Allocation fund as an alternative to simply adding to these two funds.
Question:
What is YOUR highest conviction Allocation fund OTHER THAN PRWCX or FBALX [added by EDIT>>] for TR in an IRA with no need to withdraw for at least 5-10 years?
We are really just looking for the call letters of ONE Allocation fund per poster, with, if interested, a very brief explanation of WHY that fund is your highest conviction Allocation fund.
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Post by steadyeddy on Jul 10, 2023 17:36:28 GMT
Wellington (VWELX/VWENX) - is my high conviction allocation fund.
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Post by saratoga on Jul 10, 2023 19:26:34 GMT
For a third, you might consider vgwax for global diversification.
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Post by racqueteer on Jul 10, 2023 20:13:20 GMT
Wellington (VWELX/VWENX) - is my high conviction allocation fund. +1
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Post by Chahta on Jul 10, 2023 20:39:06 GMT
I have not ever owned one of these funds. I am not clear of what the purpose is. The yields are generally paltry, if owning them for income is the purpose.
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Post by retiredat48 on Jul 10, 2023 22:53:34 GMT
BTW I came across this:
BOGLE QUOTE ON WELLINGTON FUND POOR PERFORMANCE
So you think the past is prologue, then ponder what Jack Bogle wrote in the history of Wellington Fund having a long rocky road over two decades, over market conditions similar to today:
"After (assets ) cresting at $2 billion in 1965, the Wellington's long era of growth came to a temporary halt. Performance faltered badly, the dividend tumbled, and fund assets plummeted by 75%, to $470 million by mid 1982..."
John Bogle.
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Post by Karen on Jul 10, 2023 23:51:51 GMT
I have not ever owned one of these funds. I am not clear of what the purpose is. The yields are generally paltry, if owning them for income is the purpose. Great question. I added an EDIT to OP to clarify.
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Post by Karen on Jul 10, 2023 23:53:26 GMT
For a third, you might consider vgwax for global diversification. Thank you! VGWAX is high on our Watch List for that reason, its performance, and its Value allocation. But again, to be clear to all, we are looking for poster's highest conviction Allocation fund as detailed in the OP.
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Post by yakers on Jul 12, 2023 1:44:10 GMT
Largest holding is VGWAX, also hold some Wellingtion and Wellesley.
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Post by chang on Jul 12, 2023 7:45:21 GMT
The problem with VGWAX is that, as an actively managed fund, you want to hold it in tax-deferred. But it also has foreign dividend paying stocks, which you want to hold in taxable, so you can take a tax credit for foreign taxes paid.
I find it more efficient to use separate domestic and foreign, equity and bond funds and ETFs. In other words, no allocation funds of any kind. They are a good tool for hands-off, “autopilot” portfolios, and they rebalance themselves, but they present portfolio design and tax challenges.
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Post by Karen on Jul 12, 2023 13:22:17 GMT
The problem with VGWAX is that, as an actively managed fund, you want to hold it in tax-deferred. But it also has foreign dividend paying stocks, which you want to hold in taxable, so you can take a tax credit for foreign taxes paid. I find it more efficient to use separate domestic and foreign, equity and bond funds and ETFs. In other words, no allocation funds of any kind. They are a good tool for hands-off, “autopilot” portfolios, and they rebalance themselves, but they present portfolio design and tax challenges. Not to be cute here, but I guess we find paying income taxes "inefficient." We haven't paid any personal income taxes for the past decade and don't plan to pay any for at least five more years. So losing "a tax credit for for foreign taxes paid" by a given fund has been inconsequential to us for a long time and will continue for the intended holding period of the sought after Allocation fund. That said, we respectfully don't want to derail this thread with these types of discussions. There must be some posters on this board who invest with high conviction in Allocation funds other than PRWCW, FBALX, VGWAX and/or VWELX.
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Post by anovice on Jul 12, 2023 13:28:11 GMT
With VGWAX, you need to be comfortable with 40% or more of the stock portfolio overseas.
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Post by racqueteer on Jul 12, 2023 13:48:50 GMT
There's also the question of what you would want as a 'permanent' holding. I've tracked allocation funds for a number of years, and they tend to come and go in popularity/utility; with only a handful being 'buy and forget' types. You have the three main names; I would say. All that having been said, I've been impressed with CBALX from time to time.
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Post by retiredat48 on Jul 12, 2023 15:05:10 GMT
The problem with VGWAX is that, as an actively managed fund, you want to hold it in tax-deferred. But it also has foreign dividend paying stocks, which you want to hold in taxable, so you can take a tax credit for foreign taxes paid. I find it more efficient to use separate domestic and foreign, equity and bond funds and ETFs. In other words, no allocation funds of any kind. They are a good tool for hands-off, “autopilot” portfolios, and they rebalance themselves, but they present portfolio design and tax challenges. There must be some posters on this board who invest with high conviction in Allocation funds other than PRWCW, FBALX, VGWAX and/or VWELX. Hi Karen...not to be cute, but I do have high conviction funds...but not allocation funds. Theme is this: IMO Allocation funds have lost their need for existing. Investors typically have a stock/bond allocation to their portfolio. Let's say 60/40 as an example. We now have over 20,000 funds, many fixed income. Why does an investor think they have to lump this allocation into one fund? Better IMO is to go with the top stock fund and top bond fund. Never to my knowledge have the top funds been the same investment manager. Like PIMCO and Doubeline are the best fixed income managers; they don't profess top be stock pickers. Fact is, over the years they have beaten the bond allocation side of allocation funds. Not disputed. So, why not go with the allocation one desires, into separate stock/bond funds? Then if you ever want to change the allocation you do not have to sell the other side. Want to reduce bonds, selling a balanced fund also reduces the stock side. It is just too much to expect Vanguard to have the top stock pickers and bond selectors, in the same fund. Make separate investments...much easier. My memory is you are an experienced individual stock picker; you follow markets. You can surely select one decent stock and fixed income fund. Tailor them to your portfolio needs. Follow the bond thread for ideas. Good day... R48
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Post by Karen on Jul 12, 2023 16:52:06 GMT
There must be some posters on this board who invest with high conviction in Allocation funds other than PRWCW, FBALX, VGWAX and/or VWELX. Hi Karen...not to be cute, but I do have high conviction funds...but not allocation funds. Theme is this: IMO Allocation funds have lost their need for existing. Investors typically have a stock/bond allocation to their portfolio. Let's say 60/40 as an example. We now have over 20,000 funds, many fixed income. Why does an investor think they have to lump this allocation into one fund? Better IMO is to go with the top stock fund and top bond fund. Never to my knowledge have the top funds been the same investment manager. Like PIMCO and Doubeline are the best fixed income managers; they don't profess top be stock pickers. Fact is, over the years they have beaten the bond allocation side of allocation funds. Not disputed. So, why not go with the allocation one desires, into separate stock/bond funds? Then if you ever want to change the allocation you do not have to sell the other side. Want to reduce bonds, selling a balanced fund also reduces the stock side. It is just too much to expect Vanguard to have the top stock pickers and bond selectors, in the same fund. Make separate investments...much easier. My memory is you are an experienced individual stock picker; you follow markets. You can surely select one decent stock and fixed income fund. Tailor them to your portfolio needs. Follow the bond thread for ideas. Good day... R48 Yeah, while we appreciate your thoughts on this, they're really not what we're looking for here. What we're looking for we think is clearly stated in the OP. That said, we also disagree with most of what you stated. In no particular order: We find it very difficult to consistently beat PRWCX or FBALX by pairing stock funds with bond funds. And the time/hassle in trying to do that is in our rear view mirror at our ages. In contrast to your comments, we find that scoping, buying and monitoring ONE Allocation fund is far easier than doing the same with TWO funds, one dedicated stock fund and one dedicated bond fund. We're pretty much done with dedicated bond funds for the next 5 years, at least, and hopefully forever. We own none. CDs are currently paying our hurdle % for fixed income. We're done "hoping" for annual TRs in dedicated bond funds of ~4%-5% when FDIC'd, 3-5-yr rates in that range are there for the taking. And we are NOT experienced individual stock pickers. We have owned mutual funds since early 1980's and have only occasionally, and most times, regrettably, invested in individual stocks. There have been some BIG winners, but there have also been some BIG losers. We're done with individual stocks. Thanks again, but let's move on, or shall I say, back to what was requested in the OP.
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Post by Karen on Jul 12, 2023 16:59:12 GMT
There's also the question of what you would want as a 'permanent' holding. I've tracked allocation funds for a number of years, and they tend to come and go in popularity/utility; with only a handful being 'buy and forget' types. You have the three main names; I would say. All that having been said, I've been impressed with CBALX from time to time. Thank you and agreed, on all points! PRWCX and FBALX are the two allocation funds that do NOT "tend to come and go in popularity/utility." As noted in the OP, we're searching for a possible third. CBLAX is high on our Watch List, and along with VGWAX, are the likely suspects to be our third Allocation fund, IF we go that route. Hoping this thread is NOT providing us with confirmation bias on VGWAX and or CBLAX as those ARE coincidentally the TWO other Allocation funds we consider possible "buy and forget" funds.
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Post by rhythmmethod on Jul 12, 2023 17:03:10 GMT
We invest heavily in PRWCX and FBALX. They are our two highest conviction Allocation funds. We are interested in possibly adding one more Allocation fund as an alternative to simply adding to these two funds.
Question:
What is YOUR highest conviction Allocation fund OTHER THAN PRWCX or FBALX [added by EDIT>>] for TR in an IRA with no need to withdraw for at least 5-10 years?We are really just looking for the call letters of ONE Allocation fund per poster, with, if interested, a very brief explanation of WHY that fund is your highest conviction Allocation fund. Hi Karen , I' a balanced fund holder. I like the way they tamper volatility. I use them for a part of my portfolio I call "stupid money". In other words I don't trade them and infrequently rebalance. I own VWENX, VWIAX but my highest conviction is FMSDX. It is rather multi-cap and has some foreign and different FI than the vanilla W group. If I could get into PRWCX I'd do it in a heartbeat. Take care, - RM
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Post by Karen on Jul 12, 2023 17:09:22 GMT
We invest heavily in PRWCX and FBALX. They are our two highest conviction Allocation funds. We are interested in possibly adding one more Allocation fund as an alternative to simply adding to these two funds.
Question:
What is YOUR highest conviction Allocation fund OTHER THAN PRWCX or FBALX [added by EDIT>>] for TR in an IRA with no need to withdraw for at least 5-10 years?We are really just looking for the call letters of ONE Allocation fund per poster, with, if interested, a very brief explanation of WHY that fund is your highest conviction Allocation fund. Hi Karen , I' a balanced fund holder. I like the way they tamper volatility. I use them for a part of my portfolio I call "stupid money". In other words I don't trade them and infrequently rebalance. I own VWENX, VWIAX but my highest conviction is FMSDX. It is rather multi-cap and has soe foreign and different FI than the vanilla W group. If I could get into PRWCX I'd do it in a heartbeat. Take care, - RM Thank you! We have owned VWENX, VWIAX and FMSDX in the past but sold them (and others) when we pared down to just PRWCX and FBALX. Getting into PRWCX just prior to it closing was perhaps our best investment decision of all-time. FBALX is in our opinion every bit as good as PRWCX with only about 10% of PRWCX's notoriety and investment board banter! FMSDX is a favorite of ours and is in our 2nd group of our Watch List. We would select VGWAX over VWENX because we want to add a bit more Foreign exposure. We are done with VWIAX given its high bond % that we are now using CDs to cover.
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hondo
Commander
Posts: 145
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Post by hondo on Jul 12, 2023 19:17:18 GMT
I do not have a ONE highest conviction allocation fund, but one of my highest for holding a long period of time is plain old VBIAX. A good steady long term 60/40 fund.
However, considering you previous post, I doubt you would like it.
Hope you find what you are looking for.
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Post by retiredat48 on Jul 12, 2023 19:50:27 GMT
Karen ,...OK, fair enough...I will not post here again. Just two comments on your reply: Karen: That said, we also disagree with most of what you stated. In no particular order: We find it very difficult to consistently beat PRWCX or FBALX by pairing stock funds with bond funds. And the time/hassle in trying to do that is in our rear view mirror at our ages. In contrast to your comments, we find that scoping, buying and monitoring ONE Allocation fund is far easier than doing the same with TWO funds, one dedicated stock fund and one dedicated bond fund. R48 in bold: Well, that is precisely what the longer term Wellington VWELX "committed" holders said a few years back, only to now have started several threads on the theme: "What's wrong with Wellington and Wellesley", due to sub-par performance. BTW I have a foothold in PRWCX, but have not been adding to it, as it has frankly lagged many other of my stock fund holdings. I don't recommend "set-it-and-forget-it" funds/investing.We're pretty much done with dedicated bond funds for the next 5 years, at least, and hopefully forever. We own none. CDs are currently paying our hurdle % for fixed income. We're done "hoping" for annual TRs in dedicated bond funds of ~4%-5% when FDIC'd, 3-5-yr rates in that range are there for the taking. ??If you are pretty much done with bond funds for next 5 years, then why try to find an allocation/balanced fund??
Final observation...the Balanced Fund forum on M* was a big hitter in posting volume a decade ago; not very much volume today. Many posters now use two or more funds.
R48
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Post by steadyeddy on Jul 12, 2023 21:32:53 GMT
Allocation funds play a very important role in my portfolio. For someone that is "trigger happy" with gains (conversely losses) individual funds/ETFs for stocks and bonds do not align well with my DNA.
The primary benefit of Allocation Funds is that the managers can raise cash (go to cash) during times of exuberance or distress as necessary, in addition to automatically rebalancing the components.
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Post by Karen on Jul 13, 2023 11:50:30 GMT
Karen ,...OK, fair enough...I will not post here again. Just two comments on your reply: Karen: That said, we also disagree with most of what you stated. In no particular order: We find it very difficult to consistently beat PRWCX or FBALX by pairing stock funds with bond funds. And the time/hassle in trying to do that is in our rear view mirror at our ages. In contrast to your comments, we find that scoping, buying and monitoring ONE Allocation fund is far easier than doing the same with TWO funds, one dedicated stock fund and one dedicated bond fund. R48 in bold: Well, that is precisely what the longer term Wellington VWELX "committed" holders said a few years back, only to now have started several threads on the theme: "What's wrong with Wellington and Wellesley", due to sub-par performance. BTW I have a foothold in PRWCX, but have not been adding to it, as it has frankly lagged many other of my stock fund holdings. I don't recommend "set-it-and-forget-it" funds/investing.
Ugh. Whatever LT holders of VWELX said or did is N/A to us and certainly NOT representative of the whole investor or allocation funds universes.
Ugh, again. In absolute terms, um, yeah, we get that PRWCX lags "many other of (your) stock fund holdings." PRWCX of course is only ~70% stocks, so we trust you can do the math to calculate the allocation-adjusted comparisons and see that PRWCX and FBALX effectively match or beat the performance of many/most stock funds. They do the 70/30 to 60/40 splits far better than we can using a stock fund paired with a bond fund. And with NONE of the work done by us. We're pretty much done with dedicated bond funds for the next 5 years, at least, and hopefully forever. We own none. CDs are currently paying our hurdle % for fixed income. We're done "hoping" for annual TRs in dedicated bond funds of ~4%-5% when FDIC'd, 3-5-yr rates in that range are there for the taking. ??If you are pretty much done with bond funds for next 5 years, then why try to find an allocation/balanced fund??Ugh, one more time. You didn't read/understand what I posted - "We're pretty much done with dedicated bond funds" like the PIMCO and Doubleline you previously suggested we pair with a stock fund. We accept the fact that by investing in PRWCX and/or FBALX, we get some bond exposure. But we limit our bond exposure to JUST what we get from Allocation funds. In total, that equates to about 4%-5% of our total portfolio.Final observation...the Balanced Fund forum on M* was a big hitter in posting volume a decade ago; not very much volume today. Many posters now use two or more funds.Um, yeah, we also invest heavily in stock funds like FSELX, VTSAX, FXAIX, FDSVX and PRWAX. But instead of your "two or more funds" method, we currently pair those stock funds with CDs instead of bond funds.
PLEASE, let's just leave it at that. We did NOT ask for portfolio composition advice and don't think we need it. All we asked for was what is stated in the OP. R48
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Post by racqueteer on Jul 13, 2023 13:00:02 GMT
The whole concept behind allocation funds, was for an investment which would be 'buy and hold' AND would protect your downside. So, the manager is supposed to be "balancing" equity risk against bond stability. A smoother ride. The alternative is to either index the two separately, or manage them yourself; perhaps by employing active managers of each separately. Having more variety in 'bond' choices complicates that dynamic for everyone. That's a boon if you are active, but a complication if you're looking at allocation funds...OR...are a manager of one.
We now have allocation funds which are NOT 'balanced', but which instead attempt to maximize BOTH inputs. That's a whole different animal; ASIDE from how difficult that chore is for management. I'm not sure where PRWCX falls into this spectrum, but most recognize it as NOT being a standard 'balanced' fund.
What R48 espouses is to separate the elements of the two investment types, but NOT so much for smoothing the ride. It's more of a maximization of the total. That was of benefit in the recent low interest rate environment and could be extended into the current rising rate environment; where one could combine rising rate Treasuries with lower volatility equity to approximate the traditional 'balanced' fund. We're rapidly approaching a point, however, where 'balanced funds' might have a resurgence - FOR THEIR ORIGINAL PURPOSE.
For ME, I'm not sure how many managers I'D trust with trying to optimize production from equity AND 'bonds'; while ALSO trying to "smooth the ride", and I CERTAINLY don't consider MYSELF qualified to do so. I feel as though Karen is looking for something like a traditional balanced fund which would be a 'hands off' investment. Given THAT, the choices are few (as noted).
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Post by Karen on Jul 13, 2023 18:36:03 GMT
As stated, we thought clearly, in the OP, here is what we are "looking for":
Question:
What is YOUR highest conviction Allocation fund OTHER THAN PRWCX or FBALX [added by EDIT>>] for TR in an IRA with no need to withdraw for at least 5-10 years?
We are really just looking for the call letters of ONE Allocation fund per poster, with, if interested, a very brief explanation of WHY that fund is your highest conviction Allocation fund.
=====================================
We are NOT interested in portfolio composition advice.
We are NOT interested in a discussion of the history or differences of Balanced vs Allocation funds.
So, if you own any Allocation funds, and are interested in participating on this thread, just state the call letters of the one Allocation fund other than PRWCX or FBALX that is your highest conviction holding, and if interested, add a few comments about it.
Though in declining mental health, my husband is VERY experienced in the accounting and investment fields. Given the scoping assistance that this thread could provide, he is still more than capable of taking the noted call letters and dissecting them to fit what we're "looking for."
It's really that simple. Or so it seemed.
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Deleted
Deleted Member
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Post by Deleted on Jul 13, 2023 19:22:03 GMT
JABAX
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Post by chang on Jul 13, 2023 19:22:32 GMT
Since no one has mentioned it, I’ll add that my favorite allocation fund - and the only one I own - is Puritan (FPURX).
If you want to be shocked, enter FPURX into M*, go to Chart, add Wellington VWELX under “Compare”, and click “Max” timeframe. Puritan absolutely destroyed Wellington.
$10,000 invested in 1947 would be worth:
FPURX +25,053,443.67 | +250,534.44%
VWELX +8,202,074.85 | +82,020.75%
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Post by retiredat48 on Jul 13, 2023 22:37:43 GMT
Karen , racqueteer , Chahta , chang , rhythmmethod , . Karen in your posts above you admonished Chahta, me, racqueteer and chang for commenting outside your request for a single fund name. And rhythmmethod commented about his investing rationale. To be clear, I make posts that apply not only to the Original Poster, but to all reading the forums...trying to make the forums a learning experience.I will be sure not to tread on your OPs again. R48
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Post by steadyeddy on Jul 14, 2023 0:08:27 GMT
I do like and respect Karen 's disciplined approach in keeping threads straight and narrow. Rather than getting a bit unnerved, perhaps I think we all should make that the best practice in all threads. I really believe that would make the threads "stay focused" on the topic in the OP. I am making a mental note to practice this approach. Feel free to get me back on track if I swerve from thread's objective. You will not offend me.
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Post by habsui on Jul 14, 2023 2:25:48 GMT
FMSDX (lower equity %)
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Post by racqueteer on Jul 14, 2023 2:48:13 GMT
Since no one has mentioned it, I’ll add that my favorite allocation fund - and the only one I own - is Puritan (FPURX). If you want to be shocked, enter FPURX into M*, go to Chart, add Wellington VWELX under “Compare”, and click “Max” timeframe. Puritan absolutely destroyed Wellington. $10,000 invested in 1947 would be worth: FPURX +25,053,443.67 | +250,534.44% VWELX +8,202,074.85 | +82,020.75% Is there some fundamental difference between FPURX and FBALX? They SEEM quite similar in all respects...
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