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Is now a good time to buy Vanguards Tax Managed Balanced Fund?

Hello to All- Im looking for a taxable account, conservative fund to hold for the long run. I know that much of this fund is comprised of municipal bonds- SO, more experienced people- is this a good time to buy this fund, given low yields on bonds?Thanks in advance



    Here's Zack's 09/07/21 standard type of reply for the masses to that question:

    Then there's also the current market conditions, and more importantly, YOUR SPECFIC investment strategy and risk tolerance to consider.
  • I have owned VTMFX for several years and am generally pleased as a core holding.

    It depends really on what you want to accomplish Growth? Income? and with what risk.

    Almost 10% is in FAANG ( Nvidia not Netflix) so it will take a big hit when that party is over. The Bond duration is 4.2 indicating that the bonds here will drop with a rise in interest rates.

    While VTMFX lost 20% during the Covid crash vs 30% SP500 in may get hit hard in a stagnation scenario, as the 10% FAANG will also be sensitive to rising rates.

    The yield is nothing to write home about if you are interested in income.
  • I keep getting money building up in my bank account. I finally gave up on trying to figure out a "good" place to move it and last month decided just to move it to VTMFX for no good or bad reason at all other than it is after tax money. Maybe it is never a good time to have more loose new money but, right now, if it is loose, I just don't want to continue to fidget about it.
  • sma3- thanks for your input!! Anna, I too have too much money in the bank, and I dont blame you for moving some of it- thats what I want to do-Im taking another look at Tax managed capital Appreciation- Good Luck to all!~!
  • edited October 2021
    It’s a real quandary today. No advice. Cash allows you breathing room to see what develops.

    For my really “safe” money I’ve moved to GNMA funds. Expect to lose a bit, but it’s a comfort having a degree of federal backing for GNMA paper. A good manager might be able to grab off an extra percent or two above cash or TIPs over longer periods. (Both of mine are 1-2% underwater YTD.) Checking duration at Yahoo (under “holdings”) one fund is less than 3 years out and the other between 4 and 5 years. I wouldn’t go over 5 years on duration.

    Balanced funds in general? I’ve stuck with mine. Worst case: managers will go very short term with the bond portion - costing some return potential, but also mitigating the fund’s volatility - a big reason for owning balanced funds.

    The only muni I have is PRIHX. Price calls it “intermediate”, but it behaves more like a short-term bond fund. That might be why it doesn’t score well at M* and the rest. FYI - a bet on munis - especially longer term - is a bet on the economy. Under recessionary pressures, including high unemployment, state and local (tax) revenue declines while expenses may actually increase due to unemployment benefits. This can lead to downgrades of the bonds they’ve issued.

  • edited October 2021
    Anna said:

    I keep getting money building up in my bank account.

    That’s quite common. The experts say we’re still flush with cash. A lot of spending was curtailed during the worst of Covid. Folks travelled little. And with less travel - plus working from home - new wardrobes weren’t necessary. Fuel was cheap.(Crude went below 0). People drove much less. I put off some interior maintenance for almost a year - not wanting workers in the house before being vaccinated.

    That cash is beginning to flood back into the economy. I’d like to say I invested mine like @Anna did - but, instead, it went into some important home upgrades this summer (an investment of sorts I guess). While the costs were high, I suspect they were much lower than they will be in 3, 5 or 10 years time.

  • +1 hank PRIHX only has 73 million AUM. Fidelity could take this fund and probably run 500 million or a billion in assets. Still don't know why Fido doesn't have its own high-yield muni fund. HYD is an etf in this space that I've invested in for some time .
  • @carew388 - doesn't FHIGX fit that slot?
  • Unsure- FHIGX was a high yield muni bond fund before switching to a long-term muni bond fund. 94% of the fund is rated BBB or higher.
  • I've been happy with IQ MacKay Municipal Insured ETF.
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