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looks like it's a bull...everyone is buying [several articles linked]
imho - not many are sitting on sideline, the bulls are going into equities, bonds, etc... It does not make sense to me but why fight the herd? just join them
Quoting: "In January, mutual fund investors sunk more than $31 billion into taxable and municipal bond funds, according to Morningstar. They pulled $2.75 billion out of U.S. stock funds, continuing a yearlong trend that’s seen them pull out $103 billion.
The majority of that money went to just three fund companies: Vanguard, J.P. Morgan, and DoubleLine – the last of which has grown nearly 300% in the last year." ********************* Uncle Jeffrey Gundlach will be pleased. But isn't this sort of summary just the sort of thing that would steer you and me into something ELSE? I might prefer to be in the DoubleLine funds, but if there's a huge herd headed there, would I not want to find something SIMILAR? As long as I had my mind made up to buy into a particular market sector? If the bulls are raging, great. But don't I want to take advantage of an unnoticed or unloved fund, instead?
Reply to @MaxBialystock: The average investor continues to either pull money out completely (and I think there are a good deal of people who are done with the stock market and aren't coming back for a long time if ever) and a lot of people who went to the believed "safe harbor" of bonds or ETFs (although I'm not sure how index funds will be better for nervous investors if things turn South.)
It's not just Doubleline, but all bond funds have taken in a lot of $ - the Doubleline funds have done particularly well, so they've attracted a lot of attention.
I think there was a general herd push into yield in general and I made the decision to head in the opposite direction, as I think it's understandable that people are reaching for yield given what's going on, on the other hand, when everyone and their cousin is looking for a particular asset class, strategy, etc...
tgeno, I just now caught your additional remark about getting OUT in time. Makes sense to me! Except--- where to go after that? Unless the grave? My EM Bond fund, for example, is PREMX. At this point, I'm merely continuing to re-invest all divs and cap gains. It's a default position, cuz at the moment, there is no better thing to do, given my circumstances. I wish there were a magic recipe, but there's not.
Anyhow, PREMX gets just three stars and no "precious metals" rating from Morningstar at the moment. It's been that way for at least a few years. But I believe it is behaving and performing in a way which will earn it higher grades and more stars. Turnover is low, so volatility is low. The portfolio is very spread out, to mute volatility, too. Gov't and Corp. debt accounts for the lion's share, and now, there is local currency debt in the mix. In a volatile category, it behaves well and steady. I originally held it in a 403b, but it's now in a rollover IRA. I chose it to begin with because it was available and not completely lousy: the available choices for 403b investors are diminishing every day. And its ER is quite good, too. Rather low for its category.
...4% cash. Biggest holdings: 1. Russia 2. "Reserves SBI" (what is that, exactly?) 3. Brasil, Brasil and Brasil. 20.34% in top 5 holdings. But holdings are spread-out from hell to breakfast: Venezuela, Credit Default Swaps. (??????!!!!!!!!!!) Plus, Mexico, Vietnam, Turkey, Indonesia, Serbia, Iraq, Peru.......
Scott: I have plans to add DODIX and MSCFX soon. More bonds, but a conservative, more tame flavor, plus a small-cap, which I gave up (PRSVX) when I rolled it into PREMX last summer, just to prevent TRP from charging me an annual admin. fee which jumped 100% from the year before. Slimes.
At the moment, it's a "barbell" thing I've got going, but it's not a position per se. It's just where my stuff is, while I'm in a holding pattern until new $$ shows up:
Asia Large Blend: MACSX & MAPIX..................38.38% of my stuff Individual foreign gov't zero-coupon bond matures July, 2013: 5.5% Huge Drug Co. PFE Pfizer: 15.12% EM Bond PREMX .....40.5%
Yup, that's my current mish-mash. At least the monthly PREX div. is big enough to cover half of my car payment. But I'm bot using any of it. I'm reinvesting it.
Reply to @MaxBialystock: With regard to "getting out", to me that means taking some profits, lightening up and adding to cash so I can take advantage of corrections. However, I am always "in" something or other. I am never totally out or totally in.
Comments
The majority of that money went to just three fund companies: Vanguard, J.P. Morgan, and DoubleLine – the last of which has grown nearly 300% in the last year."
*********************
Uncle Jeffrey Gundlach will be pleased. But isn't this sort of summary just the sort of thing that would steer you and me into something ELSE? I might prefer to be in the DoubleLine funds, but if there's a huge herd headed there, would I not want to find something SIMILAR? As long as I had my mind made up to buy into a particular market sector? If the bulls are raging, great. But don't I want to take advantage of an unnoticed or unloved fund, instead?
It's not just Doubleline, but all bond funds have taken in a lot of $ - the Doubleline funds have done particularly well, so they've attracted a lot of attention.
I think there was a general herd push into yield in general and I made the decision to head in the opposite direction, as I think it's understandable that people are reaching for yield given what's going on, on the other hand, when everyone and their cousin is looking for a particular asset class, strategy, etc...
Anyhow, PREMX gets just three stars and no "precious metals" rating from Morningstar at the moment. It's been that way for at least a few years. But I believe it is behaving and performing in a way which will earn it higher grades and more stars. Turnover is low, so volatility is low. The portfolio is very spread out, to mute volatility, too. Gov't and Corp. debt accounts for the lion's share, and now, there is local currency debt in the mix. In a volatile category, it behaves well and steady. I originally held it in a 403b, but it's now in a rollover IRA. I chose it to begin with because it was available and not completely lousy: the available choices for 403b investors are diminishing every day. And its ER is quite good, too. Rather low for its category.
PREMX:
ER = 0.95% ("Low" per M*)
YTD: 4.99%
1 year: 9.07%
3 years: 18.67%
5 years: 7.32%
10 years: 11.06%
...4% cash. Biggest holdings:
1. Russia
2. "Reserves SBI" (what is that, exactly?)
3. Brasil, Brasil and Brasil.
20.34% in top 5 holdings. But holdings are spread-out from hell to breakfast: Venezuela, Credit Default Swaps. (??????!!!!!!!!!!) Plus, Mexico, Vietnam, Turkey, Indonesia, Serbia, Iraq, Peru.......
Reserves State Bank of India, maybe.
At the moment, it's a "barbell" thing I've got going, but it's not a position per se. It's just where my stuff is, while I'm in a holding pattern until new $$ shows up:
Asia Large Blend: MACSX & MAPIX..................38.38% of my stuff
Individual foreign gov't zero-coupon bond matures July, 2013: 5.5%
Huge Drug Co. PFE Pfizer: 15.12%
EM Bond PREMX .....40.5%
Yup, that's my current mish-mash. At least the monthly PREX div. is big enough to cover half of my car payment. But I'm bot using any of it. I'm reinvesting it.