bd1
Ensign
Posts: 20
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Post by bd1 on Nov 9, 2023 7:51:28 GMT
Lee also has no public record of managing a balance fund. Yet he has the authority to alter the stock bond split of FBALX by 10 points in either direction from a 6040 split. in addition six of the sector managers are new since 2020.
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Post by anitya on Nov 9, 2023 8:41:33 GMT
yogibearbull , Could you please comment on the issue of manager turnover (PM changes by Fidelity) for FBALX and in general for Fidelity funds raised in earlier posts? My recollection is this is more common for Fidelity funds (than their competitors) and in general has not historically effected fund performance when the change was effected by Fidelity versus a star manager leaving / retiring. But I figured you are a better person to comment.
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Post by yogibearbull on Nov 9, 2023 12:57:18 GMT
As I mentioned, the events of 1965-80 that hurt VWELX aren't likely to repeat. Fund regulations now won't allow those sort of things by ANY mutual fund now. FWIW, DODBX and FPURX did fine in that period, but that was a dark history period for VWELX. But it's over.
On the surface, it looks like FBALX has a multimanager approach similar to American Funds. But there is a huge difference - FBALX has been a dumping ground (or hiding place) for several Fido former star managers who didn't work out with some other famous Fido funds. Fido didn't want to lose those managers and kept several in FBALX team that is now quite oversized (or bloated?). And Fido probably paid them well to keep them onboard - several former star managers left Fido too and went on to other famous funds, hedge funds, etc.
So, FBALX lead manager WAS Robert Stansky until 12/2022. Robert who? Well, in his former life, he was a hot and upcoming manager of Fido Growth FDGRX, and then Magellan FMAGX. But that path hit a dead end and he has been hiding at FBALX ever since.
Steven Kaye had his star manager days too. he ran Fido Growth & Income FGRIX for a while, but did so-so, and has been hiding in FBALX since. He is continuing for now but may be ready to retire too. Other old timers continuing are Simmons and Sorel.
Fido typically promoted from within - analysts, managers of (internal) Central Funds, (listed) sector funds, (insurance) VIP portfolios. In that respect, Christopher Lee has managed several smaller stock and sector funds. True, FBALX is his first role as lead asset allocator for FBALX. But he is just progressing in the Fido way. If he doesn't work out, he will be replaced. It would be hard to mess up a big fund with 11 comanagers around.
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Post by steadyeddy on Nov 9, 2023 13:19:08 GMT
Back to OP, the question really is (in my mind): one or two balanced funds OR two or four individual funds to cover stocks and bonds separately.
The issue with individual funds is that the mix needs to be adjusted periodically.
That is not the question in the oP.
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Post by Karen on Nov 9, 2023 13:21:48 GMT
Has anyone questioning Lee as Lead Manager even bothered to check his full bio and/or FBALX vs VWENX performance since Lee joined FBALX?
FWIW, we are LT FBALX owners and previously owned VWENX. When downsizing our number of funds several years ago, choosing FBALX over VWENX was a relatively easy decision and it would be just as easy today: management, allocation mix, and performance all favor FBALX.
We currently own only three allocation funds: PRWCX, FBALX and VGWAX. The only other one we would consider adding is CBLAX.
The better question for a thread might might be, VGWAX or VWENX? They provide similar TRs but VGWAX does it with a good chunk of Foreign exposure.
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Post by mozart522 on Nov 9, 2023 13:25:30 GMT
The failure of Wellington in that period is what lead directly to the creation of Vanguard and the index fund revolution. Bogle made a huge mistake by merging with a group of go-go managers and that caused the fund's decline. He was then fired. Vanguard would not likely ever change a fund's investing strategy from value to growth to that degree again.
Balanced funds still work for those who want to stay with their allocation and let the market do the work. Market timers (which I tend to be), may find them to be less optimal; horses for courses.
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Post by flipperxxx on Nov 9, 2023 14:07:10 GMT
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Post by yogibearbull on Nov 9, 2023 14:22:27 GMT
Unfortunately, there is no good way for after-tax comparisons. One problem is that people have different tax situations. Even the stated tax-cost ratios are for the highest tax brackets and may be misleading on the tax impact for most people. So, VTMFX (09/1994- ; R1000 stocks with lower dividends + munis) would indeed be a good hybrid for taxable accounts. It has NEVER distributed any CGs. But the OP has funds in IRAs, so tax implications don't matter.
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Post by steadyeddy on Nov 9, 2023 16:52:43 GMT
Has anyone questioning Lee as Lead Manager even bothered to check his full bio and/or FBALX vs VWENX performance since Lee joined FBALX? FWIW, we are LT FBALX owners and previously owned VWENX. When downsizing our number of funds several years ago, choosing FBALX over VWENX was a relatively easy decision and it would be just as easy today: management, allocation mix, and performance all favor FBALX. We currently own only three allocation funds: PRWCX, FBALX and VGWAX. The only other one we would consider adding is CBLAX. The better question for a thread might might be, VGWAX or VWENX? They provide similar TRs but VGWAX does it with a good chunk of Foreign exposure. Yeah.. foreign exposure might be helpful going forward, just as it was in the 2000-2009 decade. Good point.
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Post by roi2020 on Nov 9, 2023 18:13:03 GMT
If I was seeking a single fund solution, I would definitely consider VGWAX. The fund has performed well since inception although it is only six years old. The two lead managers (Nataliya Kofman - equity; Loren Moran - bond) are talented investors. Ms. Kofman is supported by two colleagues and she can also leverage Wellington's estimable global industry analyst group. Ms. Moran is supported by another portfolio manager as well as Wellington's broader credit group. Since this is a Vanguard fund, low costs (for an active fund) are a given.
Ms. Kofman and her mentor, Edward Bousa (former long-time VWENX manager), were responsible for a separately managed account which delivered strong results going back to 2009. From the Morningstar Managed Investment Report: "The equity sleeve mirrors Wellington Global Quality Value, a separately managed account, which has a strong track record going back to 2009. It has outperformed its FTSE Developed Index benchmark in eight of the last 10 years and since inception. This feat is made more impressive given the portfolio's value tilt through the growth-led markets of the 2010s."
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Post by Mustang on Nov 9, 2023 18:33:13 GMT
VGWAX is only 5 years old. I wouldn't do it. It has no track record. From Morningstar: VGWAX VWENX Lg Value Lg Blend US Equity 35.5% 57.4% Non- US 28.8% 7.7% Fixed 30.9% 33.7% Other 4.8% 1.2% 5-yr Return 6.6% 7.0% 2018 -4.7% -3.4% 2019 22.2% 22.6% 2020 7.5% 10.7% 2021 13.5% 19.1% 2022 -7.0% -14.3% YTD 4.6% 6.5% I've also been playing with a new toy (Portfolio Visualizer): VGWAX: $100,000 invested in 2018 $4,000 withdrawal adjusted for inflation is worth $106,245 today. VWENX: $100,000 invested in 2018 $4,000 withdrawal adjusted for inflation is worth $109,433 today. My wife doesn't want anything to do with trading. I wouldn't put my her in any fund that doesn't have at least some track record. Preferably one that has been through both bust and boom times. I need some assurance that she will be OK when I'm gone. Besides, the old saying is if the US gets a sniffle the world gets a cold.
Edit: I hate proportional spacing.
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Post by roi2020 on Nov 9, 2023 18:39:29 GMT
VGWAX is only 5 years old. I wouldn't do it. It has no track record. You're correct that VGWAX doesn't have a long history - it's only 6 years old. However, the fund's equity sleeve (~65% of assets) mirrors Wellington Global Quality Value which has a track record going back to 2009.
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Post by FD1000 on Nov 9, 2023 21:45:56 GMT
FD, I don't think that scenario of a new manager for FBALX applies. FBALX has 11 managers to VWELX's 2. I can't see a management change for the former to be an issue. For VWELX it might well be, however. I think more of a concern would be to have a rigid mentality wrt holdings. VWELX seems pretty consistently conservative/value-focused. I don't know if FBALX is locked into being growthy regardless of the environment, however. I think I recall that it was more valuey in the past? On balance, it still seems to me that FBALX is the better choice for a long-time hold. Again, what it your LT? is it 5,10,20+ years? Remember, "consistently conservative/value-focused" + very cheap can be a plus for LT + bonds would do better next. How many funds do you like PRWCX? almost none. If you pay attention many posts discuss changing funds. VWENX Investment approach( advisors.vanguard.com/investments/products/vwenx/vanguard-wellington-fund-admiral-shares#overview) Balanced asset allocation: 60%–70% stocks, 30%–40% bonds. Seeks long-term capital appreciation and reasonable current income, with moderate risk. Large- and mid-cap value stocks. Intermediate-, short-, and long-term government and investment-grade corporate bonds. Fundamental, risk-controlled investment approach. BTW, the top 5 holdings in VWENX are all high-tech + Tech is at 30+%...mmm...looks to me it's not as VALUE as you think. Attachments:
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Post by flipperxxx on Nov 9, 2023 22:14:24 GMT
Unfortunately, there is no good way for after-tax comparisons. One problem is that people have different tax situations. Even the stated tax-cost ratios are for the highest tax brackets and may be misleading on the tax impact for most people. So, VTMFX (09/1994- ; R1000 stocks with lower dividends + munis) would indeed be a good hybrid for taxable accounts. It has NEVER distributed any CGs. But the OP has funds in IRAs, so tax implications don't matter. thanks much. very helpful to my little cause ...
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Deleted
Deleted Member
Posts: 0
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Post by Deleted on Nov 9, 2023 23:44:07 GMT
Wellington ER is 0.17 while FBALX er is 0.51%. Does that make a difference or do returns already account for that?
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Post by roi2020 on Nov 9, 2023 23:50:45 GMT
Expenses are important and should definitely be considered when selecting a fund. Funds' trailing returns are usually reported after expenses.
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bruce
Lieutenant
Posts: 56
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Post by bruce on Nov 10, 2023 0:39:01 GMT
I want to thank you all for your time in confirming FBALX as an appropriate choice for our situation. Having many eyes and valued experience involved helps ease any thought of having overlooked something. I have no concerns about the "new" lead manager.
"The fund is managed by multiple portfolio managers, with each member dedicated to a particular asset class or market segment, plus a lead manager responsible for determining the appropriate asset allocation, general team oversight, cash management and risk monitoring. The equity subportfolio is largely sector-neutral and run by a team of sector-focused managers who look to add value through active stock selection. Christopher Lee is a chief investment officer and portfolio manager in the Equity division at Fidelity Investments. In this role, Mr. Lee is responsible for overseeing the Stock Selector and institutional equity teams. He also co-manages Fidelity and Fidelity Advisor Balanced Fund, Fidelity Series All Sector Equity Fund, Fidelity and Fidelity Advisor Stock Selector Mid Cap Fund, Fidelity VIP Balanced Portfolio, and the FIAM U.S. and Global Sector Strategies. Prior to assuming his current responsibilities, Mr. Lee served as a manager director of research in the Equity division. Before that, he managed Fidelity Advisor Financial Services Fund, Fidelity VIP Financial Services Portfolio, Fidelity Select Financial Services Portfolio, Fidelity Financial Services Central Fund, the Fidelity and Fidelity Advisor Stock Selector All Cap Funds, Fidelity Select Brokerage and Investment Management Portfolio, Fidelity VIP Growth Strategies Portfolio, Fidelity Growth Strategies Fund, and Fidelity Select Consumer Finance Portfolio. Previously, he managed Fidelity Select Electronics Portfolio and Fidelity Advisor Electronics Fund. He joined Fidelity as an equity analyst covering the semiconductor industry in 2004.Before joining Fidelity, Mr. Lee was an associate in the Technology group at TA Associates, a private equity firm in Boston. Previously, he worked as a financial analyst in the Technology group at Robertson Stephens. He has been in the financial industry since 1997. Mr. Lee earned his bachelor of arts degree in East Asian studies from Yale University and his master of business administration degree from the Massachusetts Institute of Technology (MIT) Sloan School of Management.".
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Post by Mustang on Nov 10, 2023 15:29:05 GMT
BTW, the top 5 holdings in VWENX are all high-tech + Tech is at 30+%...mmm...looks to me it's not as VALUE as you think. You are right. A couple of years ago it's returns were lower than other moderate-allocation funds. It switched direction adding more to the growth side and its returns caught up. When it did this Morningstar changed it's equity category from Value to Blended. VWIAX didn't change as much. It's equity is still considered Value.
Today's market favors growth. It has higher average returns and higher risk.
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Post by mozart522 on Nov 10, 2023 16:14:49 GMT
BTW, the top 5 holdings in VWENX are all high-tech + Tech is at 30+%...mmm...looks to me it's not as VALUE as you think. You are right. A couple of years ago it's returns were lower than other moderate-allocation funds. It switched direction adding more to the growth side and its returns caught up. When it did this Morningstar changed it's equity category from Value to Blended. VWIAX didn't change as much. It's equity is still considered Value.
Today's market favors growth. It has higher average returns and higher risk.
Considering that VWENX's benchmark on the equity side is the 500 index, it isn't surprising that is has had to move to a higher degree of growth stocks in order to stay competitive. If they wanted to be a value fund, they would need to change their benchmark.
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