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Post by chang on Sept 23, 2021 22:18:47 GMT
I know, old topic that's been asked and answered a hundred times. So here goes #101…
Shed some equity the last few weeks, proceeds sitting in cash. Note this is all in Fidelity, not VG. Fido paid me a promo for a TOA a few months ago, so I might run afoul of the rules if I move it out. So please assume that I will keep it all at Fido.
Easy options:
1. Add to existing DODIX position.
2. Buy UST (MINT, JPST, VUSB…).
3. Add to RPHIX. Expensive but extremely reliable UST/HY fund that consistently beats all other UST funds.
4. Add to munis, which are down. I own PHMIX at Fido - easy to add.
5. ??
Edit: placed an order to add a portion of the cash to DODIX.
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Post by yogibearbull on Sept 23, 2021 22:22:48 GMT
Check out Fido's newer ST bond index FNSOX to hold funds.
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Post by chang on Sept 23, 2021 22:28:38 GMT
Check out Fido's newer ST bond index FNSOX to hold funds. Yogi, that would basically be the same as BSV, right? |
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Post by yogibearbull on Sept 23, 2021 22:45:20 GMT
Yes, like VG VBIRX/BSV. But at Fido, you can buy Fido FNSOX or VG ETF BSV.
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Post by chang on Sept 23, 2021 23:01:34 GMT
Yes, like VG VBIRX/BSV. But at Fido, you can buy Fido FNSOX or VG ETF BSV. I have a very large slug of money invested between VUSFX and RPHIX. I wouldn't mind doing something a little more adventurous with this cash. BSV is 75% S/T government, which I think is dead money. I would much sooner go with RPHIX. |
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Post by Chahta on Sept 23, 2021 23:26:34 GMT
Chang are you back in core/core plus again?
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Post by chang on Sept 23, 2021 23:50:26 GMT
Chang are you back in core/core plus again? Nope. No interest in VBILX and similar. Never left DODIX - that's my only "core/core plus" fund. |
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Post by richardsok on Sept 24, 2021 3:12:44 GMT
The PPI (more realistic than the CPI) rose above 6% y-o-y back in May and has continued climbing to well above 7% and even 8% currently.
I can't help but thinking refuge in a "safe" 2% ( or LESS! ) bond fund is just slow bleeding.
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Post by chang on Sept 24, 2021 21:33:39 GMT
The PPI (more realistic than the CPI) rose above 6% y-o-y back in May and has continued climbing to well above 7% and even 8% currently. I can't help but thinking refuge in a "safe" 2% ( or LESS! ) bond fund is just slow bleeding. Nowadays, a safe 2% is dreamy! So what else is a person to do with the non-equity part of their AA? |
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Post by Chahta on Sept 25, 2021 0:44:42 GMT
Not sure of a great answer but the bond AA can be thought of in a couple of ways (income and stability). My goal is to create an income stream. I have decided I will not be affected by some volatility. Buy good long term record funds at favorable prices and build shares until I start RMDs. I’m not sure there are a bunch of funds right now that meet my criteria for additional purchase. I also have relatively safer funds like RPHIX and UST/ST too. I go out on the volatility scale with MS, HY muni, HY and a sliver of CEF. I’m trying to get out of the mentality trying to stay 1 step ahead of the 10 year bond rate.
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Post by jongaltiii on Sept 25, 2021 0:56:59 GMT
Not sure I understand what folks see in RPHIX. It’s ER is .90 and return is 1.44 YTD and 2.92 life of fund - especially when compared to FAGIX. What am I missing? Trailing inflation and a fat 1 percent ER.
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Post by richardsok on Sept 25, 2021 0:58:56 GMT
The PPI (more realistic than the CPI) rose above 6% y-o-y back in May and has continued climbing to well above 7% and even 8% currently. I can't help but thinking refuge in a "safe" 2% ( or LESS! ) bond fund is just slow bleeding. Nowadays, a safe 2% is dreamy! So what else is a person to do with the non-equity part of their AA? Well there's a couple of avenues I'd consider before locking in a big 1.8% or so. I nosed around preferredstockchannel.com, looking for preferreds selling under their redemption value AND had recent insider buying of the common. I came up with PCGpD, ASBpD, TCBIP, NRZpB for starters. There's also good ol' CNLPL, the ultimate widders & orphans stock. All are tossing off 5% or better. ---------- Or do your own search and screen for preferreds with cumulative yields + preferreds whose common is on their SAFE list + currently priced below redemption value. ------------- Or look at limited duration CEFs with flat NAVs like JSD, BLW and EVG and marry them to multi-sector VGI and PDO, possibly PFN too. Finally there's Suburban Propane, SPH, to marry with MO and the low beta income or preferred fund of your choice.. ------------- You're so far ahead of 2% you can hedge yourself with a small protective bucket of VXX on the side. I'm always suspicious of "all-weather" portfolios no matter how "safe" if there is no provision for inflation or market crashes. You're not going to agree with all these ideas. Maybe not with any of them. The point I'm trying to make is that with a little thinking and digging, you should be able to do better than 2%. IMO, of course. |
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Post by steelpony10 on Sept 25, 2021 1:43:04 GMT
chang , 1. Muni VWAHX 2. Healthcare BME a CEF 3. Infrastructure UTF a CEF 4. Utilities UTG a CEF 5. Real estate RQI a CEF 6. Preferred FFC a CEF 7. Good old PONAX/PIMIX multisector bond. Sorry I have no idea what safely means when dealing with investment markets having unknown futures.
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Post by FD1000 on Sept 25, 2021 4:07:42 GMT
Not sure I understand what folks see in RPHIX. It’s ER is .90 and return is 1.44 YTD and 2.92 life of fund - especially when compared to FAGIX. What am I missing? Trailing inflation and a fat 1 percent ER. The subject of this thread is "where to invests safely" which hintS at low risk/volatility. This ( link) says it all. FAGIX has higher volatility than Allocation 40/60(VWINX). |
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Post by chang on Sept 25, 2021 7:45:08 GMT
Not sure I understand what folks see in RPHIX. It’s ER is .90 and return is 1.44 YTD and 2.92 life of fund - especially when compared to FAGIX. What am I missing? Trailing inflation and a fat 1 percent ER. Put it this way: how much cash is being held by investors in money markets (and equivalents) right now? Compare to RPHIX … which is the better option? |
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Post by Chahta on Sept 25, 2021 10:43:49 GMT
Not sure I understand what folks see in RPHIX. It’s ER is .90 and return is 1.44 YTD and 2.92 life of fund - especially when compared to FAGIX. What am I missing? Trailing inflation and a fat 1 percent ER. Some folks have "enough" and are not especially looking for income but don't want to lose either. Risk and growth are taken in equities and "safety" is taken in bonds. Risk and safety are relative terms to each investor. |
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Post by flipperxxx on Sept 25, 2021 13:36:03 GMT
it'd seem to me that if safety is your main concern that protection against catastrophe is at the heart of the question, in which case RPHIX is likely not going to do what you want, even given its minimal risk. i think the answer lies somewhere in the world of FDIC-insured accounts -- zero growth but, with RPHIX returning not much more than zero, you're getting what that fund can't give you, which is insurance, up to a certain amount per account (i think), which of course is only as good as the government backing it. so, on a million dollars, you'd be giving up a (measly?) $14.4k ytd in exchange for exactly what you're after: worst-case safety. am i right or am i right?
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Post by jongaltiii on Sept 25, 2021 14:45:48 GMT
Oh I didn’t understand you were/are seeking a cash alternative and that is the purpose of RPHIX for those using it. Thanks for explaining. I really was curious and not criticizing. Re: flipperxxx post above… yes that makes sense to me especially if taking inflation into account on returns. I’m not hunting for it but I suppose if there was another bond or HY fund that has a similar return with the same risk (but lower ER) … it would have been mentioned. |
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Post by chang on Sept 28, 2021 12:57:19 GMT
Stocks and stock funds (including sector funds) don’t count here.
FI CEFs — maybe, but I got out of CEFs a long time ago when the discounts of the ones I owned turned to premia. I no longer have the inclination to pay the required attention to CEFs, UNIIs, etc. plus many are too illiquid to hold large amounts.
I frankly doubt there is any magical asset that I have overlooked. I suspect that just barbell-ing X% equity with Y% short term, low yielding FI is the way to muddle through the rest of my life.
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Post by chang on Sept 28, 2021 13:02:00 GMT
it'd seem to me that if safety is your main concern that protection against catastrophe is at the heart of the question, in which case RPHIX is likely not going to do what you want, even given its minimal risk. i think the answer lies somewhere in the world of FDIC-insured accounts -- zero growth but, with RPHIX returning not much more than zero, you're getting what that fund can't give you, which is insurance, up to a certain amount per account (i think), which of course is only as good as the government backing it. so, on a million dollars, you'd be giving up a (measly?) $14.4k ytd in exchange for exactly what you're after: worst-case safety. am i right or am i right? I’m not looking for insured safety, that would be going too far. I am fine with VUSFX, RPHIX etc. which at least yield something. I would be OK with BSV except I see no point in holding so much AAA rated bonds yielding ziperoo in a rising rate environment. RPHIX has demonstrated pretty impressive success over a long time and through a variety of crises. I don’t worry about it. When Sherman retires (not imminent) they will probably shutter it. |
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Post by yogibearbull on Sept 28, 2021 13:19:06 GMT
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Post by chang on Sept 28, 2021 13:52:52 GMT
Thanks Yogi. By “safely” I really mean not taking silly interest rate risk without compensation (think EDV).
I am trying hard to simplify, not complicate, my portfolio. So I would like to add to existing holdings if I can. Options include VUSFX, RPHIX, DODIX, RCTIX, and VWEAX. Since I already own these, it would actually make sense simply to add to them (except the VG funds are sitting with VG).
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Post by shipwreckedandalone on Sept 28, 2021 14:07:23 GMT
In 2020 MINT dropped 9X (-4.56%) what the yield offers today (0.50% ballpark). If an investor is buying these for the purpose of yield alone, then I question the risk/reward reasoning. The overall market direction has much more influence than yield to your TR experience.
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Post by Deleted on Sept 28, 2021 14:52:02 GMT
With zero interest rates, low bond yields and inflation, cash has become the most unsafe investment. Fed and Govt. seems to be pushing investors higher up the risk curve. Not sure if it is intentional or not.
For me, in last few years US growth stocks have been safest. INTL stocks specially China the most unsafe.
And I am very risk averse person by nature. so risk averse that my wife has been threatening divorce me over it.
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Post by chang on Sept 28, 2021 16:29:28 GMT
For me, in last few years US growth stocks have been safest. INTL stocks specially China the most unsafe. Well ...... from a valuation standpoint, I think one could disagree. I am diversified in both US and foreign stocks. I don't agree with those who argue for 100% one or the other. Efficient frontier theory says that some combination of both maximizes risk-adjusted return. |
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Post by Deleted on Sept 28, 2021 17:32:47 GMT
valuation standpoint - How do you determine valuation of stock, mutual fund/etf and a market such as China, India, US, UK?
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Post by chang on Sept 28, 2021 18:16:55 GMT
valuation standpoint - How do you determine valuation of stock, mutual fund/etf and a market such as China, India, US, UK? I guess Benjamin Graham would be the best place to start. The basic principles of security analysis and valuation are independent of where the company is located. |
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Post by Deleted on Sept 28, 2021 18:40:53 GMT
Yeah, Ever since I read graham made most (all) of his money in growth stock(s). I am not a graham fan anymore.
Also he his very outdated.
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Post by richardsok on Sept 28, 2021 18:47:28 GMT
valuation standpoint - How do you determine valuation of stock, mutual fund/etf and a market such as China, India, US, UK? After 40 years of investing/trading, I've learned I don't and can't determine evaluation -- and when I try, or think I have succeeded, I'm merely deluding myself. The best I can do is to heed the continuously updated TipRanks/SmartScore number in TD Ameritrade for any stock or fund I'm considering, or the Merrill Lynch ratings or Goldman Sachs "compelling" ratings when I can find them -- in all cases paying particular attention to CHANGES in ratings (upgrades/downgrades). Also very helpful; the data cockpit (and "insider buys" list) in finviz.com -- as well as comments I read here and formerly on M*. Capecod and LordXot come to mind, as does our very own Xray. Fear not -- won't bore you with yet another iteration of my personal TA trading philosophy. |
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Post by chang on Oct 3, 2021 21:17:10 GMT
I wonder if M/S ETFs like DIAL, MUSI, etc. could serve a purpose? They are certainly a lot cheaper than most of the M/S OEFs which fail to impress. However, I have imposed a ban on any new instruments: I will only add to existing ones.
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