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What Are You Buying ... Selling ... and/or Pondering? (April & May 2017)
Added more EM debt via an addition to TGINX. I'm considering replacing one of my four somewhat "core-ish" bond funds with FNMIX....purists may frown on that move, but after watching this area for a few years now, I would be comfortable with the relative volatility plus I'd diversify to two different managers for this space.
Catch22 and others have, I recall, been pleased with FNMIX. I suppose I'd be in it, too, but I stick to PREMX (TRP) just for simplicity, since the biggest slug of my stuff is with TRP. FNMIX and PREMX always seem to run neck-and-neck. But FNMIX always somehow wins by a nose, when you look at the stats...... Currently: FNMIX YTD +5.1% 1-year: +16.36% 5 years: +6.03% ***************** PREMX YTD: +4.83% 1-year: +14.76% 5-years: +5.42%. As the old Texaco tiger used to say: "Happy Motoring!"
Pondering GLFOX, WSBFX or LCORX as an alternative to typical ETF index funds or a go anywhere equity play. A bit concerned about GLFOX's run up and not sure how it would react in a downturn. Downside risk is always one of my top priorities with a fund.
GLFOX is tops in these categories for infrastructure (M* breaks it down as follows - Utilities=33%, Industrials=54%, Consumer Cyclical=5%, Tech=5%):
GLFOX has 26 holdings all but six outside the US. So the fund makes concentrated bets with lower US Market correlation.
Using VPU (Utility), VIS (Industrials), FSRPX (Consumer Cyclical), and QQQ (Technology) as favorable alternatives components that cover the GLFOX investment footprint (Utilities=33%, Industials=54%, Consumer Cyclical=5%, QQQ=5%) I back tested using Portfolio Visualizer.
GLFOX performance compares to a portfolio of (VIS, VPU, FSRPX & QQQ) is way:
And performance chart (GLFOX is Portfolio 2 in Red):
And finally the drawdown smack down goes to GLFOX:
You have to admire the performance of GLFOX measured against any global or international fund I admire. I own ARTRX and FMIJX, and like them. The Lazard fund, however, with its small number of seemingly boring companies that run toll roads or build water treatment plants outperforms them. I think this is a case of a really skilled manager with a deep bench.
I too have added to GLFOX in the past couple of weeks. And AUENX. I like the fact that AUENX does not simply rely on Consumer Defensive stocks, but includes a good amount of Financial and Utilities. And also contains a good amount of mid cap. My allocation to these two funds, as well as VMVFX have risen this year.
You have to admire the performance of GLFOX measured against any global or international fund I admire. I own ARTRX and FMIJX, and like them. The Lazard fund, however, with its small number of seemingly boring companies that run toll roads or build water treatment plants outperforms them. I think this is a case of a really skilled manager with a deep bench.
A "really skilled manager" who delivers 30 basis points in excess return after 108 basis points in higher expenses and roughly 4-5 times the turnover! Just a little too bad they take so much for themselves.
@BenWP- Sorry I wasn't criticizing, I was essentially trying to reinforce your point but with a caveat that I wasn't really focusing on last evening. The "quotes" were only meant to reflect they were your words rather than an attempt at sarcasm. The weighted average expense ratio for bee's portfolio 2 is just over 0.14% and the very rough weighted average turnover for that portfolio is about 8%. In an age where everyone talks about the death of active management, GLFOX is an exception.
I pointed out the expense ratio to emphasize that they're not just delivering great returns, they're overcoming the difference in expense ratios compared to bee's choices as well as the cost of higher turnover, which doesn't get captured in the expense ratio. In this case, however, they're a good deal less tax efficient than bee's choices and that would put them somewhere around 100 basis points, again very roughly, behind bee's choices annually in a taxable account but wouldn't matter in a tax-advantaged account.
I think that means GLFOX is pretty compelling for a tax-advantaged account but you'd have to believe their ability to adjust sector allocations without you knowing for months is valuable. Considering they hold positions for an average of roughly 3 years it would be a little surprising if the timing of their trades was so good that it justified the bigger tax burden.
To the topic of the discussion, I haven't been making many trades recently other than a couple AIPs I have in place for GPEIX and GPMCX, but I am looking for opportunities to reduce my exposure to stocks due to valuations. I'm sitting on my hands a little because I have some price targets in mind and even though that usually comes back to haunt me I'm still waiting for now.
Over the past couple of weeks I have watched the yield on the US 10 Year move from about 2.5% to 2.25%. This is quite a move over the past two week period and with this I have now backed off of buying in the income area of my portfolio but might add to my CD ladder as I continue to sell down equities and rebalance more towards the low range for equities within my asset allocation (raising cash).
Today will be an interesting day in this shortened week of trading with some major bank and financial stocks reporting earnings. A few of the big names being Citi Group, J P Morgan along with PNC Financial. Earnings will probally be strong but there are a lot of geopolitical risk abounding as well.
I'll write more about this evening under the thread "The Markets & More!"
Over the past couple of weeks I have watched the yield on the US 10 Year move from about 2.5% to 2.25%.
Isn't this the very dynamic that causes capital appreciation in Bond Funds that you may already own? This change in rate is about a 10% move which should translate into a 10 - 12% price appreciation on those bonds (capital appreciation+plus coupon).
Average active mutual fund investment grade corp. bond:
--- YTD = +2.2%, 1 month = +2%
We remain about 35% invested in bonds, with 99.9% of this in investment grade corp. bonds. NOTE: the past week time frame has also seen nice price appreciation in the Treasury issues sector. Perhaps just a blip and a fart for some bond types.
Hi guys! This is old news....bought some VINIX weeks ago in the hope of good things out of DC. Sold DISSX.....just taking some profits from the pivot. Also, sold GLRBX this week. It's lagging.....have VWINX in that space. So I'm raising some cash now for some summer buys. I really thought with Donnie getting next to nothing....done. Lately, this market would fall some even on the Korea thing. Mainly looking overseas to put some cash to work. But all I see are the talking heads saying Europe, EM. So, I will wait for something to change or the chatter to slow and they move on to the next hot idea. Japan is the only thing the heads don't seem to be talking about right now so that may be a go soon with me. God bless the Pudd
Hi Crash! I'll take a stab at this. No not at all----why? Well, you keep on buying what you always did.....only more shares of IBM, PG, J&J, etc. You can't own all the shares the same way with bonds. It's a $3 trillion dollar market, so no problem there. Also, the size has come over time. Also, if it was a problem, they could close. Also, if it keeps rising, people aren't selling. Why? Great payouts. I think it's mostly retirees....JMO, mind you. It's an old farts fund -- lol. God bless the Pudd p.s. Think Baby Boomers. It's all good.
Yes, more coffee required. Thanks for the replies. ...And here's a new one, for any who are willing, to think about: I am getting dandy monthly pay-outs from my bond funds, and re-investing it all, so far. (PREMX and PRSNX.) Thinking a few years ahead, I want another bond fund which I can use for monthly income. At some point, I would begin to take monthly dividends in cash from the other two as well, which are both in rollover Trad. IRA at TRP. I had owned DLFNX, but it has stalled.
I DO prefer a bond fund---with my question in mind--- which pays MONTHLY, not quarterly. Simplifies budgeting. I've scoured and scraped and dove into list after list, trying to find: -A not-too-risky-bond fund; Corporates or gummint (investment grade or middle-quality, but not junk.)
-which pays monthly -and is domestic -with regular dividends at .03 cents or more.
The prospects which suit me so far amount to only these: VWETX (though risk/reward are extreme. M* rates both as HIGH.)
ACTDX Hi-yld munis. Not a category I want, but I think that gov't obligations would very rarely default. (Stockton, CA!!!)
PTIAX multi-sector bonds. (Monthly pay-outs are extraordinary!)
There can't be only THREE for me to choose from, even while employing my gaseous, amorphous filters, eh??? If you have thoughts on these 3 and/or care to offer further suggestions, I'd be grateful. Maybe @Junkster is already "on the ball," too. I had PM-ed him.
Given the geopolitical situation across the globe, our portfolios have made modest re-balancing:
1. Switch FMIJX to the institutional share, FMIYX as the fund closed as of April 30, 2017 2. Increased bond allocation to PIMIX 3. Increased EM equity through SIGIX and VWO 4. Reduced US allocation 5. Increased cash position in Stable Value and Vanguard Ultrashort bond fund, VUSFX
Comments
Currently: FNMIX YTD +5.1%
1-year: +16.36%
5 years: +6.03%
*****************
PREMX YTD: +4.83%
1-year: +14.76%
5-years: +5.42%.
As the old Texaco tiger used to say: "Happy Motoring!"
GLFOX has 26 holdings all but six outside the US. So the fund makes concentrated bets with lower US Market correlation.
Using VPU (Utility), VIS (Industrials), FSRPX (Consumer Cyclical), and QQQ (Technology) as favorable alternatives components that cover the GLFOX investment footprint (Utilities=33%, Industials=54%, Consumer Cyclical=5%, QQQ=5%) I back tested using Portfolio Visualizer.
GLFOX performance compares to a portfolio of (VIS, VPU, FSRPX & QQQ) is way:
And performance chart (GLFOX is Portfolio 2 in Red):
And finally the drawdown smack down goes to GLFOX:
Here's a recent M* article:
http://www.morningstar.com/news/business-wire/BWIPREM_20170324005091/lazard-global-listed-infrastructure-fund-wins-two-lipper-fund-awards.html#.WO1jz16AGNg.gmail
I pointed out the expense ratio to emphasize that they're not just delivering great returns, they're overcoming the difference in expense ratios compared to bee's choices as well as the cost of higher turnover, which doesn't get captured in the expense ratio. In this case, however, they're a good deal less tax efficient than bee's choices and that would put them somewhere around 100 basis points, again very roughly, behind bee's choices annually in a taxable account but wouldn't matter in a tax-advantaged account.
I think that means GLFOX is pretty compelling for a tax-advantaged account but you'd have to believe their ability to adjust sector allocations without you knowing for months is valuable. Considering they hold positions for an average of roughly 3 years it would be a little surprising if the timing of their trades was so good that it justified the bigger tax burden.
Today will be an interesting day in this shortened week of trading with some major bank and financial stocks reporting earnings. A few of the big names being Citi Group, J P Morgan along with PNC Financial. Earnings will probally be strong but there are a lot of geopolitical risk abounding as well.
I'll write more about this evening under the thread "The Markets & More!"
Not a bad investment.
LQD, investment grade corp. bonds (3/4 digit tickers no longer highlight here)
--- YTD = +2.3%, 1 month = +2.8%
Average active mutual fund investment grade corp. bond:
--- YTD = +2.2%, 1 month = +2%
We remain about 35% invested in bonds, with 99.9% of this in investment grade corp. bonds.
NOTE: the past week time frame has also seen nice price appreciation in the Treasury issues sector.
Perhaps just a blip and a fart for some bond types.
This is old news....bought some VINIX weeks ago in the hope of good things out of DC. Sold DISSX.....just taking some profits from the pivot. Also, sold GLRBX this week. It's lagging.....have VWINX in that space. So I'm raising some cash now for some summer buys. I really thought with Donnie getting next to nothing....done. Lately, this market would fall some even on the Korea thing. Mainly looking overseas to put some cash to work. But all I see are the talking heads saying Europe, EM. So, I will wait for something to change or the chatter to slow and they move on to the next hot idea. Japan is the only thing the heads don't seem to be talking about right now so that may be a go soon with me.
God bless
the Pudd
Regards,
Ted
Yup! It's in the 401k. But I wish I had a cool $5 million. Also is my largest position.
God bless
the Pudd
More coffee, dude!
VINIX = $222.5 billion !!!
Pretty much the world owns some of this somewhere, eh?
http://financials.morningstar.com/fund/purchase-info.html?t=VINIX®ion=usa&culture=en-US
I'll take a stab at this. No not at all----why? Well, you keep on buying what you always did.....only more shares of IBM, PG, J&J, etc. You can't own all the shares the same way with bonds. It's a $3 trillion dollar market, so no problem there. Also, the size has come over time. Also, if it was a problem, they could close. Also, if it keeps rising, people aren't selling. Why? Great payouts. I think it's mostly retirees....JMO, mind you. It's an old farts fund -- lol.
God bless
the Pudd
p.s. Think Baby Boomers. It's all good.
Regards,
Ted
I am getting dandy monthly pay-outs from my bond funds, and re-investing it all, so far. (PREMX and PRSNX.) Thinking a few years ahead, I want another bond fund which I can use for monthly income. At some point, I would begin to take monthly dividends in cash from the other two as well, which are both in rollover Trad. IRA at TRP. I had owned DLFNX, but it has stalled.
I DO prefer a bond fund---with my question in mind--- which pays MONTHLY, not quarterly. Simplifies budgeting. I've scoured and scraped and dove into list after list, trying to find:
-A not-too-risky-bond fund; Corporates or gummint (investment grade or middle-quality, but not junk.)
-which pays monthly
-and is domestic
-with regular dividends at .03 cents or more.
The prospects which suit me so far amount to only these:
VWETX (though risk/reward are extreme. M* rates both as HIGH.)
ACTDX Hi-yld munis. Not a category I want, but I think that gov't obligations would very rarely default. (Stockton, CA!!!)
PTIAX multi-sector bonds. (Monthly pay-outs are extraordinary!)
There can't be only THREE for me to choose from, even while employing my gaseous, amorphous filters, eh??? If you have thoughts on these 3 and/or care to offer further suggestions, I'd be grateful. Maybe @Junkster is already "on the ball," too. I had PM-ed him.
1. Switch FMIJX to the institutional share, FMIYX as the fund closed as of April 30, 2017
2. Increased bond allocation to PIMIX
3. Increased EM equity through SIGIX and VWO
4. Reduced US allocation
5. Increased cash position in Stable Value and Vanguard Ultrashort bond fund, VUSFX