Did You See Why The S&P 500 Is Outperforming Dividend Mutual Funds?

Ted

FYI: Dividend mutual funds as a group lagged the S&P 500 stock index over the 10 years that ended going into Monday.

The reasons for the underperformance are worth keeping in mind whenever you make buy or sell decisions in your portfolio, particularly the diversified portion — your mutual funds and ETFs. They could boost the octane in your funds’ fuel tank.

Dividend funds lagged despite having outperformed as a group over the first half of the decade. But as the post-financial-crisis bull market picked up steam, the S&P 500 began to top dividend funds in total return.
Regards,
Ted
http://www.investors.com/etfs-and-funds/mutual-funds/did-you-see-why-the-sp-500-is-outperforming-dividend-mutual-funds/

slick

The article is correct, but dividend funds have less downsize risk, such as in 2008 when VDIGX ( my largest fund) was down 26% instead of the S + P's 37%. I have more than one fund to cover the large cap arena, including S + P index ( finally succumbed to buying the index this year ) trying to capture the ups and downs of different market cycles. I still have a preference for managed funds despite evidence of hard to beat the index, nothing wrong with having both managed funds and indexes.

Ted

@slick: Glad to see you've become a 'haystacker', I have always felt one should not be trapped into a choice between passive or active management, own both !
Regards,
Ted