FYI: (Unfortunately the printer-friendly version won't link, you need to click on pages 2 &3 at bottom of thje first page)
How well is your fund doing? You can get a straight-line performance number—past five years or past ten—out of the annual report. But if this is all you look at you are getting a warped view. The winners on this simplistic scorecard are simply the funds whose style matches whatever kind of market prevailed in the recent past.
Regards,
Ted
http://www.forbes.com/sites/baldwin/2015/06/26/ratings-for-1471-mutual-funds/print/
Comments
Plus, the AUM have ballooned to $12B, and the real strength of it (besides being about as recession-resistant as a stock fund could be) has been in Ahlsten's mid-small picks, and it may be getting harder to move the needle with those, with so much $ in the fund now.
But now I don't know how good any of this work is. I just checked out FDVLX, WWNPX, HFCSX, DEFIX, and RSPFX on Lipper, and for preservation most are 2s with a couple of 4s! Wtf?? Also, Forbes does not take into account tenure or longevity; none of these funds has a current manager responsible for any good avoidance back when. So a useless and misleading piece so far as I can see. Wow.
Return in 2008: -51.4%
My comment about PRBLX was based on what I remember as a one-notch change in the up-market rating, the timing of which seemed to coincide with recent underperformance. I didn't see any explanation of weighting of recent vs. long-term results, but didn't look too hard either.
Their methodology specifically requires results over "two market cycles", so obviously there will be a lot of manager changes during that time. If they added continuity of management to the mix the list would be pretty short, I would guess.
Sure, except when there aren't (Tillinghast, Ahlsten, Yacks, those are the ones I know). Has TWEIX changed managers?
A useless piece, and worse, the more I think about it. LB's comment above is astonishing.
What is the opposite of alpha? Downside protection due to, what, style box.
>> If they added continuity of management to the mix the list would be pretty short, I would guess.
And the only thing that means anything. I mean, I am not gonna buy Celtics tickets this month based on how good they were with Pierce and Garnett and Allen. Much less Bird and McHale. Who thinks like that? As if putting on the uniform means anything.
I have thrown over a third of my lot with DSENX, so will be able to report in flaming glory how it does the next serious slump, and after.
The thing that I can't quite figure is if that data is in fact so flawed, how does Forbes manage to survive? Surely there are lots of capable commentators in the professional competition- wouldn't you expect them to gang up on Forbes and hang this stuff out to dry?
A market meltdown causes one form of insomnia, but funds with prolonged slow recovery time from MaxDD turns patient investors into financial zombies. Talking from experience here.
I now look for managers and funds that have shorter recovery time from MaxDD.
MFO's @Charles discusses/explains Recovery Time here:
Thanks Charles
Research paper on Subject:
Risk Management : Using SAS to Model Portfolio Drawdown,
Recovery, and Value at Risk
Which funds bounce back quicker than the next in their category?
My "wholly grail" is incomplete, but it includes my personal experience with:
The 2007-2009 MaxDD & recovery time for this fund was comforting:
YACKX - LC Value
Other funds that lose less therefore need to make up less:
PRWCX & BRUFX _ Moderate Allocation
VWINX - Conservative Allocation
POAGX - MC Growth
PONDX - Multisector Bond
GASFX - Utilities
PRMTX - Tech
PRHSX - Health Care
MAPIX - Asian Income
Definitely could use some help if you or others are offering.
Derf
Allow me to "cherry pick" a moment in time that would have been unfavorable for YACKX if mentioned at a cocktail party held back in March of 2008.
March 1998:
"So Bee, What the "buzz" on your hot tech stocks these days?"
"Buy Value, not growth"
Two years later the same acquaintance at a much swankier cocktail party asks in
March 2000:
"So Bee, how's that YACKX working out for you?"
Fast forward to 2015:
(If I hadn't fallen off the cocktail party list for this spring's soiree) I'd say,
"Pretty good"
My Take:
Value often falls out of favor because it's not considered "hot" or "flashy".
Value really fell out of favor in (March 1998) as (Tech Growth) continued to elevate for another two years (May 2000). Even with that under performance, value has held up better than growth long term.
YACKX has had a value matrix that has worked,
"But what about next time?"
I'll fall asleep thinking,
"Probably."