I was looking at our taxable accounts, and noticing the returns on our various tech-sector funds, and so I asked myself, why even buy the S&P 500 these days--not that I am actually in the market for adding much of anything to the taxable at this point.
If I was 20-30 years younger, why not just buy a tech fund--or four in the case of my taxable (because I like baskets)--and rearrange the rest of the deck chairs to suit my druthers, i.e., risk tolerance?
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That's why with my (slowly growing) taxable account, where I play with lots less money and choose single stocks, I search and dig to find unknown names that are actually great companies, carrying much lower P/E ratios. Because I like dividends, I am often in banks--- banks that are off everyone's radar. Just lately I took a tiny toe-hold into a Singapore-specific ETF with the ticker, EWS. (iShares, BlackRock.) Selecting that ex-USA new holding was strategic. The rest of the world has seen the erratic political and economic behavior out of Washington, and they are looking to build compacts with each other and bypassing the U.S. ...Canada is/was our 2nd-biggest trading partner, but it sure looks as if that's not going to hold for long.
Call yourself fortunate, eh?
https://www.barrons.com/market-data/funds/gal?mod=searchresults_companyquotes&mod=searchbar&search_keywords=gal&search_statement_type=suggested
It's a fund of funds. Maybe that won't appeal to you.
I bought SMH for the taxable in February 2024 when some poster here was talking about chips. So I put a few bucks down. And zowie! I already had TDIV, FSCSX, and CSGZX.
So it keeps me comfortable owning my old fogies like DODGX, SEQUX, VEIRX, FSMEX, and POSKX; plus the fliers on FMIMX, GLFOX, RWJ, VSMIX, etc.
There are some duds mixed in there too. I'll be rearranging those deck chairs overboard in the near future.
If you already have tech, why buy the rest of the S&P 500 willy nilly when you could focus on SPHQ or SPGP?
I know a guy i went to college with who says he held onto the rydex nasdaq100 and fidelity select tech through out (imo its tall tales out of school) and maybe he did but thats a makeup most people don't/didn't have. LOTS of people in their late 20's and 30's with tech portfolios who have had it work for them quite a bit.
so the answer is ultimately risk. I sometimes ask this question to the young coworkers who ask a similar question. why not just tech, why not 3Xtech?
I do believe technology itself will likely lessen the time it takes from peak to peak in a recession. I have no evidence of this outside of the v shape recoveries we've experienced in the past handful of years. I feel like these would of drawn out longer 20-30 years ago.
In the early 1990s, a good friend invested in ten individual stocks, putting about $3,000 into each. The rest of his monthly contributions went into the S&P 500.
Nine of those stocks didn’t amount to much — but the tenth, Microsoft, grew into more than $1.5 million.
who are primarily interested in the highest U.S. large-cap returns¹.
Investors may realize higher success rates for actively managed funds
in other categories like bonds (broadly speaking) or emerging market equities.
¹ Some investors deliberately select less risky large-cap funds.
However, if you were the buy and hold type, there was a window five years ago where you could have picked up a number of funds that are still beating QQQ despite everything since then. Just for fun, I'll mention three small-cap value funds: VSMIX 26.05, BSCRX 21.65, and RWJ 19.72 to 19.21 for QQQ.
Will those funds maintain their leads? Who can say? Sometimes it helps to get lucky. If you had bought DODGX, VFINX, and QQQ on March 24, 2000, your investment in DODGX would have grown by 1024% to 598% for VFINX and 534% for QQQ.
March 24, 2000 was the day the S&P 500 peaked before the bust--if Perplexity can be believed. Let's try March 31, 1999, QQQ's first day. Since then, DODGX 1,168%, QQQ 1311%, and VFINX 739%. As with comedy, timing is everything.
VOO ain't what it used to be. Actively managed BBLU has been beating it for fifteen years with less tech and less volatility. Tech-heavy funds like FELG and SCHG also beat it.
Over the last five years it has become rather easy to beat. Just the other day I bought EISIX, which has been beating it for five years; so have BSCRX, AICFX, and AFIFX for that matter. Then there are any number of growth-oriented funds that are doing it.
But what if I had bought VOO and VSMIX five years ago, and continued to invest 100.00$ a month since then. I would guess that the day you actually bought would make some difference. But I'm not going to parse that when Portfolio Visualizer can get me close enough--dinky linky. For those that don't follow links, you would have 44K in VSMIX to 32K in VOO. The worst year for VSMIX was +4.58 versus -18.19 for VOO. Will VOO catch up to VSMIX some day? Maybe. Stay tuned.
Forgot to include QQQ in the previous scenario. Here you go. DFL: VSMIX still winning.
Buy tech? Absolutely. Buy the S&P 500? If it floats your boat, why not?
A financial advisor about 5 years ago published a list of mutual funds with a longtime track record of 12% or more returns and that had a very positive previous 10 years. He was very much like see Dave Ramsey was right this is easy! someone looked at those funds 5 years later and did a memorandum. only 12% of those funds (most sector and large growth) beat the sp500. And it was a very popular post in Dave Ramsey circles which tells me tons of people likely built their portfolios around them.
lots of people have caught lightning in a bottle and captured the upside of funds like AIVSX/DODGX as a result of their proliferation in retirement plans.
But timing is everything and I think morningstar stated that most equity mutual funds show Investor return to be less than NAV return over 3-15 yr periods because people buy funds when they've already captured much of the upside over those periods.
show Investor return to be less than NAV return over 3-15 yr periods because people
buy funds when they've already captured much of the upside over those periods."
I believe you are referring to Morningstar's annual Mind the Gap study.
"We estimate the average dollar invested in US mutual funds and exchange-traded funds
earned 7.0% per year over the decade ended Dec. 31, 2024.
That estimate, which is akin to an internal rate of return calculation,
accounts for investors’ purchases and sales of fund shares during that 10-year period."
"The 7.0% annual dollar-weighted return is about 1.2 percentage points per year
less than these funds’ 8.2% aggregate annual total return
(which assumes an initial lump-sum purchase) over the 10 years ended Dec. 31, 2024.
That 'gap' is explained by the timing and magnitude of investors’ transactions during the period."
https://www.morningstar.com/financial-advisors/volatility-bedevils-fund-investors
The best for you and undeniably one of the best. But simply the best, better than all the rest?
ETFs offer greater accessibility at possibly lower trading cost (bid/ask spread vs. TF at many non-Fidelity brokerages). Institutional investors and traders may have difficulty using FXAIX with its restriction of two round trips within 90 days (trading rights are suspended if this is exceeded).
In terms of raw performance, FXAIX is arguably not even the best. Fidelity's Flex fund FDFIX, used by Fidelity's robo advisor, has a better 5 year return (it hasn't been around for 10 years yet). On the DIY front, USPRX ($100K min) has a better 10 year return. Though technically not an S&P 500 fund, Lipper includes it in its S&P500 index category.
Different strokes for different folks. "Best" here can be mathematically quantified by constructing an "objective" function that measures how good a fund is. But each person's priorities translate into different objective functions.
As for S&P 500 funds I don't/didn't have time to suss out all the various idiosyncrasies of all the options available and just went with FXAIX in my Roth and XLG in my taxable account until I change my mind.
Much better to diversify into cheaper stuff or RSP. Lots of other things went up. Trees do not grow to the sky
Future market for Tuesday, November 4, 2025 is all red, including the safe haven asset such as gold.
https://finviz.com/futures.ashx
Between holding SPHQ and SPGP in the taxable, I took a pass on RWL.
Overall we have been a net seller of stocks so to increase the fixed income allocation.
Be patient with oversea investing since there are solid companies out there but they are trading at much more reasonable multiples. I use dollar cost averaging approach to build positions.
My 60/40 portfolio is at 17% YTD. Some of that "40" is Pimco CEFs and there is a LOT of cash. So, not a "normal" 60/40 portfolio of S&P and treasuries. Admittedly, certain individual holdings have done a lot of the heavy lifting this year: WBD, CEG, NOK, TSM, RTX, JNJ, PRSCX. When I X-ray my total portfolio to account for mutual fund compositions, NVDA is now my largest holding, with FAANGs basically trailing right behind.
You appear to have misread your own links and chart re FDFIX, which lags FXAIX a couple bucks over 5y, so far as I can see using Chrome for the Fido research chart comparison page. Ah, that chart ends at the end of September. So I assume FDFIX somehow pulled ahead the last 5 weeks, correct? I don't know how to change the endpoint of the Fido comparison performance chart to get it to stop yesterday close of trading. Will investigate.
And of course FXAIX outperforms those two major ETFs nontrivially, by a few hundred, over that period.
Even if those two ETFs had done better, I would not have taken short-term trading into account. And for a stickler I should have written best-performing, yes. Finally, I would of course not have included a $100k min fund, but I am having trouble in any case delving USPRX, as over a half-dozen sites show it grew only into the ~$18,000s over the last 5y, and another 2-3 showed it had not been around for 5y.
including the peak of the dot-com bubble.
The Shiller P/E¹ recently breached 40 for only the second time.
This portends meager S&P 500 returns in the coming years.
https://marketsam.cmail20.com/t/d-e-gjyktld-duklntldl-r/
¹ The Shiller P/E isn't a useful timing tool and can remain elevated for a long time.
The data table has two rows with the funds and columns with performances over various time periods through October 31. It shows FDFIX beating FXAIX by 3 basis points annualized (17.65% vs 17.62%) over five years, 3 basis points annualized (22.69% vs. 22.66%) over three years, and 2 basis points (21.45% vs. 21.43%) over the past year (Nov 2024 - Oct 2025).
I would not have taken short-term trading into account.
Agreed. Which is why I would discount the fact that YTD (under a year), through Oct 31, FXAIX has done better (same table).
Best performance is to be inferred in this forum;
Similarly, in this forum one expects to see higher min funds discussed periodically. Even $1M min funds (e.g. Schwab MMF Ultra shares) get a shoutout from time to time.
We're not talking about sector funds or alternative investments here. There are more than a few participants here who likely could handle a core investment of $100K.
For example, FD1000 wrote that his SIL, investing 50/50 in S&P 500 and QQQ can retire now. That sounds like someone who has at least $100K invested in the S&P 500. And masterd wrote "VOO and QQQ (or QQQM) are the only funds I would purchase".
I don't know how to change the endpoint of the Fido comparison performance chart to get it end yesterday close of trading. Will investigate.
I am having trouble in any case delving USPRX,
Try here: https://www.morningstar.com/funds/xnas/fdfix/chart
Enter the tickers for FXAIX and USPRX one at a time in the "Compare" box. One can compare the three funds' total returns over the lifetime of FDFIX by setting the timeframe to max and setting the frequency to daily.
Through Nov 3:
FDFIX: 234.8558%, FXAIX: 234.6069%, USPRX: 236.8972%
To compare FXAIX and USPRX over USPRX's lifetime, you can do the same thing, only using USPRX's M* chart:
https://www.morningstar.com/funds/xnas/usprx/chart
Through Nov. 3:
USPRX: 1685.5348%, FXAIX: 1659.6410%
another 2-3 showed [USPRX] had not been around for 5y https://vcm.com/assets/fund-docs/Mutual Funds Planned Name Changes Feb 23 2023 Final.pdf
USAA Asset Management was sold to Victory Capital in 2018-2019.
https://ir.vcm.com/news/news-details/2019/Victory-Capital-Completes-Acquisition-of-USAA-Asset-Management-Company/default.aspx
for high minimum investment funds specifically within IRA accounts.
However, these types of funds are generally available via most (all?) Vanguard accounts.
A recent experience springs to mind.
The minimum investment for WCPBX at Fidelity is $1 million while it is only $500 at Vanguard.
Numerous TF mutual funds are available via Vanguard with a $500 minimum investment.