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Some really big YTD gains in bond funds of all stripes and colors

edited April 2016 in Fund Discussions
Government, emerging markets, and long term bond funds up over 7%. World and corporate bond funds up over 4%. Junk corps up 3.62% with some of the larger ones up over 5%. Even some of the stodgy bank loan funds are up in the 3% to 4% range and some of the steady eddie funds in this category have had but one or two down days in the past two months. The junk munis are trailing at 2.62% albeit some of the better ones are near 4%. Munis in general seem to be overloved. Never a good thing from a contrarian point of view. Entering today I was 41% bank loans, 29% junk corp, 26% junk munis, and 4% emerging markets. That could be subject to change (as it is almost everyday) as may exchange more out of my Nuveen junk muni (NHMRX) into more of my Nuveen junk corporate (NCOIX) This scattered and diversified approach is normally not my thing but it sure has been less stressful. Hopefully can incorporate more of that strategy as I continue to age. Up around 4.35% YTD (edit: 4.99% through 4/22) and would be thrilled to get 10% for the year - or whatever the market has to offer. I am always more concerned with a smooth ride upward in my account with as least volatility as possible than I am hitting it out of the ballpark Harper style.
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Comments

  • @Junkster I see you trade MF rather frequently, trying to time the market. Do you ignore all fees for selling mutual funds prematurely or keep some discipline in doing that?
  • It is turning out to be a good year for bond traders. 12/2015 and 1/2016 were a couple of down months, but I kept the discipline and finally caught a nice rally. It is nice to see all the bond sectors are in rally mode simultaneously. It is a rare treat. I have been 64% high yield muni funds and 36% bank loan funds for the past couple of weeks. I like the risk/return in bank loan funds, although corp junk is coming on very strong.
  • edited April 2016
    DavidV said:

    @Junkster I see you trade MF rather frequently, trying to time the market. Do you ignore all fees for selling mutual funds prematurely or keep some discipline in doing that?

    DavidV big difference between a timer and a trader. Timers predict and forecast while traders react. Never met a successful timer or at least a successful Mom and Pop timer. Hear about a lot of their claims but whenever I ask if they care to back them up by multi years of real time trading statements or 1040s (and I would reciprocate) they always back down. Everyone seems to trade stocks, options or futures. If they only knew about the trading opportunities in open end mutual funds. But to them it is akin to watching paint dry. Yes, I ignore the fees associated with selling funds within 90 days (Scottrade) It's part of doing business albeit getting harder to ignore. In the old days at INVESCO and Strong you could buy and sell their in house funds at will with no fees whatsoever. Then came the $17 fees and now as of a month or so it's has risen steeply to $49.99 at Scottrade. Even more if it is a transaction fee fund. That may force me to change my style or at the very least be more of a diversifier and not be so quick to cut and run.
  • edited April 2016
    Some big winners at this house ytd are BLV (long gov & IG corp bonds, up 9%), JENSX (a lower volatility, "quality" stock fund), up 7.7%, and a small pack of muni bond cef's (up 6-10%, not steadily up anymore, but still strong).

    The ride's been fun, but when normally less correlated stuff is headed in more or less the same direction, much of it on the expensive side, the yellow light starts flashing - especially with negative average seasonality for risk coming up.
  • edited April 2016
    Currently holding 14 funds - about normal for me. Everything green yesterday - very unusual.
    Best was PRNEX +1%. Worst RPSIX with slight gain.

    The commodity/NR sectors have been coming back for a few months now. Two steps forward & one step back, but gaining ground. Overlooked by most is nat gas which is rebounding from severely depressed prices. Not sure if that trend can persist, but interesting if you follow the energy markets.

    Sold both of my spec investments in recent weeks (OPGSX, PRLAX) so a lot of the fun has gone out. Just watching paint dry nowadays, Nice post by Rono, who accurately called the hot silver market months ago. Both gold and most pm's on fire today.

    (Sorry this is outside the thread - but I really don't do bonds. Just a tad in EM & international which are having a decent year.)
  • @Junkster said "In the old days at INVESCO and Strong you could buy and sell their in house funds at will with no fees whatsoever."

    And Dick Strong could get yesterday's price !

    Thanks for all the posts and continued success !
  • Some really big YTD gains in bond funds of all stripes and colors
    -- Not RSIVX = 0.67 YTD
  • edited April 2016
    My income sleeve is up ytd about 2.75% which consist of six funds (GIFAX, LALDX, LBNDX, NEFZX, THIFX & TSIAX) and my hybrid income sleeve also consisting of six funds (CAPAX, CTFAX, FKINX, ISFAX, JNBAX & PGBAX) is up about 3.25%. Currently, I don't have any funds within my portfolio that are not up ytd. Overall, my portfolio as a whole is up ytd about 4.1%; and, in comparison, the Lipper Balanced Index is up about 3.1%.
  • edited April 2016
    Junkster said "In the old days at INVESCO and Strong you could buy and sell their in house funds at will with no fees whatsoever."

    Curiously, An agent at Strong was the only one ever to call into question my frequent exchanges (during a phoned-in exchange) over the 3-4 years I had money there. But no other actions were taken. Other houses haven't ever said a word. I do read their FT regs in the Prospectus and attempt to steer clear.

    I worry a lot with T Rowe. Tends to be the one where 90% of my portfolio changes occur. In part due to their large selection of funds and in part because I tend to hold both a Roth and Traditional IRA with them. Taking a distribution from one usually involves some rebalancing in the other. But so far, no problems with them.

    The other ones where I have money, such as D&C, there just isn't much reason to trade. Maybe one or two changes a year. I'd love to hear Junkster reveal what it takes to be banned from a fund house! God knows I've tried their patience over the years.:)



  • edited April 2016
    Old_Skeet said:

    My income sleeve is up ytd about 2.75% which consist of six funds (GIFAX, LALDX, LBNDX, NEFZX, THIFX & TSIAX) and my hybrid income sleeve also consisting of six funds (CAPAX, CTFAX, FKINX, ISFAX, JNBAX & PGBAX) is up about 3.25%. Currently, I don't have any funds within my portfolio that are not up ytd. Overall, my portfolio as a whole is up ytd about 4.1%; and, in comparison, the Lipper Balanced Index is up about 3.1%.

    If you are up 4.1% YTD with the large cash position you hold then that is a very commendable return. Congrats!

    Edit: So are you including cash as part of your portfolio because if you are you must have some boffo equity funds YTD? As I recall you were a bit of a momentum investor so that would not surprise me at all.

    The other ones where I have money, such as D&C, there just isn't much reason to trade. Maybe one or two changes a year. I'd love to hear Junkster reveal what it takes to be banned from a fund house! God knows I've tried their patience over the years.:)


    T Rowe was the very first fund family I was banned from when I held an account there in the early to mid 90s.
  • edited April 2016
    @ Junkster,

    Thanks for the insight. Back than Price's wording was more vague: "Round trips" (in/out/in again) within 90 days were deemed excessive. About a decade ago (maybe less) they went to the present 30-day hold (If you sell a fund you can't buy back in for 30 days). Also, the present 90-day redemption fees (on many of their funds) did not exist (to the best of my knowledge) in the 90s.

    I'm probably one of the few here who still keeps money directly at the several houses rather than using a brokerage.. Without trying to defend this archaic practice, I will say that it does impose some badly needed discipline on me and eliminates a lot of second-guessing as to whether I'm in the very best performing fund in its class. I'm afraid such constant comparing of funds would drive me nuts.

    But have left a number of houses over the past two decades when they failed to meet my needs. Among those were Calamos, Strong, TIAA-CREF.
    -

    *Forgive me! Almost forgot to note that I left Hussman several years ago. However ... That one's on a different planet. Check-out HSGFX. The guy can't even make money after the Dow plunges 2000 points to start the year.

  • I'm afraid such constant comparing of funds would drive me nuts.
    Except when I am hiking, with my ladyfriend, and sleeping, every moment is spent strategizing. And yes, it drives me nuts!!!
  • edited April 2016
    YTD gains in the CEF world are even more striking due to leverage and discount shrinking. many funds are up over 10%. looks like 2012 all over again in the fixed income spread stuff - loans, HY, EMD, structured credit -- all up more than equities. mortgages are modestly up too. volatility is down... i guess in the world of zero to negative rates, anything with an earned yield over 8% finally gets appreciated.
  • edited April 2016
    Hi @ Junkster,

    Sorry I missed your above question. Thanks for the query to my mailbox.

    The year-to-date investment return reported above comes from Morningstar portfolio manager. I believe, it excludes the cash that I hold as a separate asset eventhough it is listed as a cash holding within portfolio manager. I compute the year-to-date return with cash at 3.4%.
  • msf
    edited April 2016
    hank said:


    I'm probably one of the few here who still keeps money directly at the several houses rather than using a brokerage.. Without trying to defend this archaic practice, I will say that it does impose some badly needed discipline on me and eliminates a lot of second-guessing as to whether I'm in the very best performing fund in its class. I'm afraid such constant comparing of funds would drive me nuts.

    But have left a number of houses over the past two decades when they failed to meet my needs. Among those were Calamos, Strong, TIAA-CREF.

    As someone who thrives on data, I'll look at funds from anywhere.

    If getting a fund through a brokerage has no cost (or provides some benefit, such as access to cheaper shares), I'll use the brokerage. If there are reasons to own directly with the fund, I'll do that. So I've got quite a mix. Some families I own directly include:

    Vanguard - cheaper to buy, easy to convert from Investor shares
    T. Rowe Price - cheaper to buy, they were the first to offer a free individual 401(k) with a Roth option, they provide free M* membership (if you meet balance requirement)
    Columbia - legacy Acorn funds that provide noload access into full family (and some fund Z shares are not available through brokerages)
    Franklin Templeton - legacy Mutual Series (same reason as Columbia)

    I don't hold Janus funds directly, but people who do are in good shape - they have access to cheaper D shares that are only sold directly. If you don't already have an account with Janus they won't let you open one.

    Another reason to go direct is that some funds are only open if you purchase that way. At AC, there's ACMVX. At Vanguard, there's VWELX.

    Buying direct isn't necessarily archaic. It can be cost effective, and may give access to some good funds that you can't get any other way.
  • I used to be like that but for intellectual hygiene (my brain clarity and challenges thereto) I went a few years ago to ML via BoA and Fido only, and so I buy only whatever is offered therein for free. Works okay thus far, although I forsake Bruce and some (many) others, yes. Also I trade and 'time' less than in decades past. But tracking and tax time are way simpler.

    @AndyJ, if you like JENSX you might want to look into the thus far outperforming LC etfs SPHD, NOBL, CAPE, and latterly OUSA.
  • I am the most patient investor I know, not always that way but age and time will do that.
    I saw the opening was on Bonds, so I looked at my only 4 bond funds TGEIX, PIMIX MWTRX, TGBAX for 1yr and YTD. The leader YTD is TGEIX-Emerging Market Bond, for 1 yr.TGEIX. The worst TGBAX for both YTD and I yr. No changes planned. For 5 years none are loosers.
  • edited April 2016
    An update ... @Junkster

    Through April 22 according to Morningstar Portfolio Manager my three best performing funds year-to-date are FDSAX (+8.9%) ... PGUAX (+8.9%) & PMDAX (+7.8%). My three worst performers ytd are SPECX (-3.3%) ... THOAX (-2.1%) and ANWPX (-0.4%). Overall the investment return on the portfolio as a whole is +3.5% and the ytd return factoring in cash held and profits taken computes to 3.1%. In comparison the Lipper Balanced Index is shown to have a ytd return of 2.8% according to the WSJ.

    In addition, my income sleeve is shown to be up ytd @ 2.87% and the hybrid income sleeve is up 3.55% ytd. Last week they were reported at 2.75% and 3.25% respectively.

    In review, while the income sleeves were up this past week other parts of the portfolio were down a little from last week reporting where my overall investment return was 4.1% (according to portfolio manager) and when factoring in cash held plus profits put me at 3.4% overall. Last week the Lipper Balanced Index had a ytd return of 3.1% according to the WSJ.
  • Closed end funds provided a rare opportunity in Feb during the oil scare. Discounts went to almost 15% on select funds. I got them at 10.5% yield on average and they are up 10% on NAV from where I got them.
  • @shipwreckedandalone,

    Nice work on your closed end funds. I use to dabble in them some years back; but, not anymore. I'd be interested in knowing how you continue to fair with them. I'd buy at good discounts and when they narrowed I'd sell collecting the dividends while I waited for the discount to narrow. Sometimes it worked ... and, sometimes it did not.

    Old_Skeet
  • Skeet, my personal choice is to hold them and collect dividends as long as the market wants to pay me. I set a mental stop loss right above where I bought them and let the market tell me when to sell them. To me its not how much you make, its how much you don't lose.
  • edited April 2016

    I set a mental stop loss right above where I bought them and let the market tell me when to sell them. To me its not how much you make, its how much you don't lose.

    Hi shipwrecked, just curious here what sort of "right above" percent where you bought cef's that you typically use to trigger a sale.

    I've been using percent below the recent (usually 3m) high dividend-adjusted price as the main trigger, 2-3% depending on the price volatility of the fund, continuing with incremental sales if confirmed, somewhat balanced against relative premium/discount and any negative dividend or portfolio news. But I also like the current price vs. purchase price idea.

    Is that a hard figure for you, what % do you typically use, and do you balance versus other factors?
  • Interest rates are low not because of the fed because that is what the market wants. Hate to hear return to normal interest rates--these are normal interest rates because the market knows that the higher rates banks could get earlier were just subsidized by US taxpayers. If you want higher rates today you need to destroy housing just like before the 2008 crash the markets were saying if you want lower rates you will destroy the banks. See how labor benefits over capital in todays rate environment.
  • Hi Andy J, my approach is to spend 95% of my time determining which CEF manager to choose or sector?, when is the appropriate time to buy?, why am I buying?, strategy on averaging down and what increments and price?, total return potential derived from the investment?, historical valuations of that CEF comparable to my proposed purchase price(s), institutional seasonal timing etc. If I am lucky and get most of that right, the CEF will bounce higher. There are probably others on this board more qualified to provide a stop loss strategy. I set my stop loss .10c or so above my cost basis. Sorry I do not have a more scholarly answer. I just feel the stop loss strategy doesn't matter as much to me if I can get my cost basis right. If I do not get the cost basis right, then I have other problems.
  • I set my stop loss .10c or so above my cost basis.

    Thanks - it was a simple question, and you answered it.
  • edited May 2016
    Junk corp continue to defy the experts - the H0A0 is up 8.07% YTD. Since this is a universe of over 2000 companies (no cash) it will outperform during bull runs. Still, the average mutual fund in this category is up 5.60% YTD with many of the better ones up over 6% and 7% ala IVHIX and JYIIX to name just a few. Bank/senior/leveraged loan funds ala SAMBX and JFIIX are up over 5% YTD. Going into today was 40% junk corp spread over three funds and 55% bank loan spread over two funds. I should be higher in junk corp but.........
  • edited May 2016
    @Junkster - I'm no Bill Gross, but I'm up 7.5% YTD in my bond only portfolio, which has been almost all in bank loan funds for the past 2 months. I have 80% in bank loans funds, LSFYX, JFIIX and SAMBX and 20% in DVHIX, a municipal high yield fund. The bank loan funds have been less volatile than corp HY, but corp junk may be catching its second wind here. IVHIX looks good and it is finally coming back after Bryan Krug's departure a couple of years ago.
  • Slowlane You are doing great and beating my 6%+ YTD. You should clarify that your 7.5% is your portfolio return YTD as you only trade bonds. I am still real wary of corp junk. It is still about oil in that sector. If we head back down will roll over my JYIIX into JFIIX. IVHIX has a high % in bank loans and why I like it in the corp junk category. Bank loans have been as smooth a ride as you and I have had the past many years. Bring on the higher rates!
  • Yes, that is correct - my portfolio return YTD is 7.5% and I only trade bonds. I learned from the master @Junkster.

    I was in corp junk in Feb and March, but I went into bank loan funds since they were performing as well as corp junk funds. I want to see a few more days of corp junk outperformance before I start moving that direction.
  • edited May 2016
    @SlowLane & @Junkster

    Those are great year-to-date returns.

    Thanks for posting what you are doing.

    And, most of all I sincerely do enjoy reading about the success of others.

    Old_Skeet
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