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I watch this one as one gage of how conservative allocation funds are faring. For years it’s been regarded (ISTM) as the Cadillac of that group.
Surprised to see it down 0.30% YTD even after today’s +.45% gain. And last year it lost more than 9%. Never owned it. Just trying to figure out what’s causing its problem - likely some staple in its mix that isn’t performing as expected.
@Hank. I too use this one as a gage. It’s basically 38% VYM and 62% BND. So last years decline mirrored the sum of its parts. But it’s set and forget for its fans. No miracles tho..
Thanks @larryB / Last year’s unusually big hit was understandable as bonds slid along with stocks. But it can’t seem to get out of its own way this year. The ”secret sauce” for so many years no longer working it seems. I wonder if money has been leaving?
It may be stumbling now, but I'd be surprised if it stumbles for long. The fee advantage it has over its other active fund competitors is large. In the short-term that means little, but over a long time period, that deducting an extra percentage point each year in fees from the typical active fund is a cumulative drag that weighs them down.
Not so great YTD. At least part of that is due to its mandate - generate income. On the equity side, it invests in high dividend stocks. Vanguard is clear about this. The equity side of its benchmark is the FTSE High Dividend Yield Index. https://investor.vanguard.com/investment-products/mutual-funds/profile/vwinx
Thanks for insights. I hadn’t realized the equity side is concentrated in income producing stocks. Explains a lot, as ISTM that segment is prone (like any other segment) to hot and cool periods. I sorta remember once a year ago referring to funds that focus on that segment of the market (income producing stocks) as potentially “risky.” At the time they were one of the best performing segments. Got taken to the woodshed - justifiably. But I think my point was really that concentrating on any particular segment puts a portfolio at risk of greater volatility - or, in the case of this fund, periods of under and over performance.
Lewis, of course, is absolutely correct that in the longer term, low fees will win the day. One of the first things I learned after joining this esteemed group (then Fund Alarm) was the importance of keeping fees low. By and large, I do that - notwithstanding that one or two of my alternative funds bump the average up a bit.
I think that low cost funds were historically found at vanguard. Now one could build a clone of any actively managed fund using cheap ETF’s. It’s possible that one of Vanguard’s great competitive strengths has been eroded going forward. Maybe.
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https://www.morningstar.com/funds/xnas/vwinx/performance
Not so great YTD. At least part of that is due to its mandate - generate income. On the equity side, it invests in high dividend stocks. Vanguard is clear about this. The equity side of its benchmark is the FTSE High Dividend Yield Index.
https://investor.vanguard.com/investment-products/mutual-funds/profile/vwinx
VHYAX tracks this index. YTD it is down 4.26% vs. 1.99% for its category. While VWINX is actively managed, it swims in a pool that is underperforming this year. How have other high dividend equity funds done?
https://www.morningstar.com/funds/xnas/vhyax/performance
Lewis, of course, is absolutely correct that in the longer term, low fees will win the day. One of the first things I learned after joining this esteemed group (then Fund Alarm) was the importance of keeping fees low. By and large, I do that - notwithstanding that one or two of my alternative funds bump the average up a bit.