Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Support MFO
Donate through PayPal
Mod. Alloc. fund not named PRWCX (TRowe Price Cap. Apprec.)
Yes, I too always thought "moderate allocation" investors would find a -36.5% drawdown a bit hard to stomach. That said, DODBX dropped 45.8% during this time and scores a UI of 14.9. While VWELX dropped "only" 32.5% with its UI of 9.2. So, your caution is a good one. No question though that PRWCX beat them all from an absolute return perspective.
>> No question though that PRWCX beat them all from an absolute return perspective.
Well, for the last year. If you compare Giroux's work up to a year or two ago with, say, Pinto (JABAX), it's equally good (and a bit better than Oak and FP), but not uniquely so.
Hank, as others have implied, PRWCX is closed to new investors.
Does anyone know anything about the Voya versions (virtual clones) of PRWCX (ITRAX / ITRIX / ITCSX / ITCTX)? They are open according to M*, but can the average investor purchase them???
I'm leaning towards a M/A fund instead of bonds, simply because the future interest rate movement will be higher and that is generally not good for bond funds. Am I off on this? Any further comments, thoughts and/or suggestion are greatly appreciated!!
I have stuck with MAPOX. Market price has taken it down to 12.93% of my total. I concentrate on the 3-year return number, rather than day-to-day, because I've actually been in the fund for 3 years, now. But now, here it is, Thursday, 27th August, and EVERYTHING is green and doing well, even XOM, which is the 5th-largest holding in MAPOX. I do not think that the fund's bias toward Upper Midwest companies is good or bad, either way. Only 5% turnover, with a Large/Value slant. http://www.morningstar.com/funds/XNAS/MAPOX/quote.html
mcmarasco "I'm leaning towards a M/A fund instead of bonds, simply because the future interest rate movement will be higher and that is generally not good for bond funds."
Buying MA funds you just outsource the task of buying bonds to the fund manager. If you believe the bonds are not good they will be as bad in MA fund portfolio as in bond funds. You just have no idea how bond part of MA funds perform and that probably creates some illusion of comfort for you. It may be more prudent to build 60/40 portfolio by buying 60% stocks and keep 40% in cash or almost cash bond funds. That way you will not protect the portfolio from losses as in case of core bond funds, but at least will reduce its volatility.
"Does anyone know anything about the Voya versions (virtual clones) of PRWCX (ITRAX / ITRIX / ITCSX / ITCTX)? They are open according to M*, but can the average investor purchase them???"
According to test trades I just made, these clones are not available at WellsTrade, Fidelity, TDAmeritrade, Scottrade and Firstrade. I still think that the most attractive option is to get a friend or acquaintance of yours to gift you a share between taxable accounts at a given brokerage.
"I'm leaning towards a M/A fund instead of bonds, simply because the future interest rate movement will be higher and that is generally not good for bond funds. Am I off on this? Any further comments, thoughts and/or suggestion are greatly appreciated!!"
Most if not all allocation funds have a bond component. In my experience I have bought short duration funds to complement the fund plus income funds as additional protection. Of course that may or may not work but I didn't want to stay with the generic bond fund these MA funds usually hold.
I am particularly fond of BRUFX, the Bruce Fund. It's not available thru the big brokerage houses (Schwab, et al.), but it has a 15 year annual return of 15.46% compared to 10.11% and 10.08% for FPACX and PRWCX. and Bruce shines in shorter time periods also. One difference between BRUFX and most of the other moderate allocation funds is that Bruce's stocks fall in the mid-cap style box. The father-son team which runs this fund doesn't do fancy interviews or annual reports; they just concentrate on investing. As a bonus the fund is relatively tax-efficient with only an 11% turnover.
I am particularly fond of BRUFX, the Bruce Fund. It's not available thru the big brokerage houses (Schwab, et al.), but it has a 15 year annual return of 15.46% compared to 10.11% and 10.08% for FPACX and PRWCX. and Bruce shines in shorter time periods also. One difference between BRUFX and most of the other moderate allocation funds is that Bruce's stocks fall in the mid-cap style box. The father-son team which runs this fund doesn't do fancy interviews or annual reports; they just concentrate on investing. As a bonus the fund is relatively tax-efficient with only an 11% turnover.
I am particularly fond of BRUFX, the Bruce Fund. It's not available thru the big brokerage houses (Schwab, et al.), but it has a 15 year annual return of 15.46% compared to 10.11% and 10.08% for FPACX and PRWCX.
I'm hoping BRUFX with help cover my future some of my out of pocket "unhealthiness"...I have an Health Savings account with Bruce Fund that I contribute to monthly.
There is no cash position other than the internal cash held by the fund so you are always fully invested in the fund which probably helps contribute to the low turnover mentioned by @NumbersGal.
>> no cash position other than the internal cash held by the fund How is that different from other funds?
My point is that not with regard to the fund, but to the lack of a cash position (mm fund) option at Bruce.
At some point I would like to sell shares of BRUFX and holds these proceeds in a cash position (in hsa status) for disbursement at a later point in time. A cash position would also allow me the flexibility to "dial up to" the manager's allocation (including his cash) or "dial it back" with my cash position, but still within the structure of the hsa.
if you already own BRUFX at Bruce, can you transfer your holding in its entirety to another HSA, ie, Saturna, TD, etc...thereby allowing you to sell shares and hold the cash as necessary?
if you already own BRUFX at Bruce, can you transfer your holding in its entirety to another HSA, ie, Saturna, TD, etc...thereby allowing you to sell shares and hold the cash as necessary?
Again, not my point. I would like to own BRUFX as well as have the convenience of a personal cash position with Bruce. If what you are suggesting is to move my BRUFX shares "in kind", my experience is that the new administrator has to have access to that fund on their platform. BRUFX is not on any other platform.
BRUFX is a lone wolf and I like that. I just want a d#mn cash account too. I've reached out to Bruce about this, but it's not a deal breaker where I resort to another hsa option.
@bee so, when you send in your hsa money for the year, you have no control over when they buy shares in the fund?
I have an account similar to that at Altegris (private equity and hedge funds). Sometimes I like the fact that it's not that accessible...I have a tendency to mess with my funds at Schwab. But, I always get a little nervous when I deposit money at Altegris because I can't control when it goes into the funds. And I like to average in and average out...not dump a big slug of money at once.
@bee so, when you send in your hsa money for the year, you have no control over when they buy shares in the fund?
Actually it gets invested as it arrives, but it remains fully invested until I redeem shares or a dollar amount. All of this is done via US mail. The online account is spartan. I use bill pay as a monthly hsa contribution method and I receive emails from Bruce that they have received my contribution and I can also log onto my account to verify the transaction history online. This fund is a one trick pony and so far so good even though I would like a MM fund (cash) option as part of my account.
For the OP, BRUFX is a fine choice. Just realize that investing in the Bruce Fund has it's nuances that are a bit more "old school".
@little5bee, All institutional shares of Thornburg funds are available for $5K (not $100K) for non-retirement accounts at Fidelity. These institutional shares are on the Transaction Fee platform, and thus require a transaction fee of $50. Like Bob C eluded to, TIBIX is an excellent choice for those who wish additional foreign exposure.
Each brokerages have different agreements with the mutual fund companies on the investment minimum and for different types of account.
Is that Maximum Drawdown of 36.5% for PRWCX historical or hypothetical? Honestly, I can't remember it ever dropping that much. Possibly in '08 with some recovery near year's end?
The other one I'm familiar with is OAKBX. On that one the managers like to make bold calls. That might be overweighting Treasuries (a decade ago) or buying GM when it was depressed last year. So, the risk metrics don't really tell you much. It could be a "2" this month and a "4" a month or so later depending on their views of the markets.
I found it amusing that Friday every one of my dozen funds (income, commodity, equity) was in the green - except for (over-hyped) PRWCX which lost a fraction. You never can tell.
DavidV, point well-taken! Definitely something to consider!
Kevindow, thank you for performing the test purchases, too bad! The down side of your suggestion is that I do not know anybody who owns PRWCX. Also, it is not very tax friendly and I'm looking to put this fund in an IRA.
JohnChisum, I would greatly appreciate any suggestions for short duration and/or income funds for me to consider and investigate?
VILLX is very volatile; I know it has performed well but I do not need to have the best performing MA fund. I want something that is a little less volatile with solid returns and other metrics. With a 5-year SD of 11.8 (per M*), I should be able to find a stock fund with better returns.
I will have to check out BRUFX; I have heard of it but know very little about it.
Once again, thank you all for your thoughts and suggestions!! Matt
@little5bee, I apologize that I miss-typed. The $5K minimum investment is for retirement accounts, not non-retirement accounts as I stated earlier. The $100K requirement is common across many brokerages. Another approach is to buy direct from the mutual fund company if they have lower minimum. Some may but they requires monthly automatic investment.
At present I like to get into Seafare G&I, institutional share, but don't have $100K and there is no work-around this yet.
Since my holdings are all with American Century, my suggestions would be narrowly focused. I hold ASDVX for the short duration unconstrained bond. AMJVX is their multi-asset income fund and ALNNX is their alternative income fund which I use as a complement to AMJVX.
For short duration, I like the template my fund has. < 2 years duration. Unconstrained gives the fund management more leeway as where to go.
For income funds, I also favor the anywhere style of unconstrained and multi-asset. The markets of today are complicated with various types of investments. As I mentioned above, I use ALNNX as a complement. There are some duplicate strategies between both funds but ALNNX includes hedging and other strategies. The way it performed in this past downturn was impressive, but that is also just one event. With the bond markets as they are investors have to change their thinking somewhat as being in longer term bonds during a period of rising rates will surely be counterproductive.
These strategies are relatively new and M* doesn't classify them properly. Running some Google or Bing searches may provide more answers.
Edit: BlackRock has a decent offering in the multi-asset income sphere. BAICX.
Comments
Everything is negotiable...it pays to ask/plead!
Yes, I agree.
Well, for the last year. If you compare Giroux's work up to a year or two ago with, say, Pinto (JABAX), it's equally good (and a bit better than Oak and FP), but not uniquely so.
Hank, as others have implied, PRWCX is closed to new investors.
Does anyone know anything about the Voya versions (virtual clones) of PRWCX (ITRAX / ITRIX / ITCSX / ITCTX)? They are open according to M*, but can the average investor purchase them???
I'm leaning towards a M/A fund instead of bonds, simply because the future interest rate movement will be higher and that is generally not good for bond funds. Am I off on this? Any further comments, thoughts and/or suggestion are greatly appreciated!!
Thanks, Matt
http://www.morningstar.com/funds/XNAS/MAPOX/quote.html
Buying MA funds you just outsource the task of buying bonds to the fund manager. If you believe the bonds are not good they will be as bad in MA fund portfolio as in bond funds. You just have no idea how bond part of MA funds perform and that probably creates some illusion of comfort for you.
It may be more prudent to build 60/40 portfolio by buying 60% stocks and keep 40% in cash or almost cash bond funds. That way you will not protect the portfolio from losses as in case of core bond funds, but at least will reduce its volatility.
"Does anyone know anything about the Voya versions (virtual clones) of PRWCX (ITRAX / ITRIX / ITCSX / ITCTX)? They are open according to M*, but can the average investor purchase them???"
According to test trades I just made, these clones are not available at WellsTrade, Fidelity, TDAmeritrade, Scottrade and Firstrade. I still think that the most attractive option is to get a friend or acquaintance of yours to gift you a share between taxable accounts at a given brokerage.
Kevin
"I'm leaning towards a M/A fund instead of bonds, simply because the future interest rate movement will be higher and that is generally not good for bond funds. Am I off on this? Any further comments, thoughts and/or suggestion are greatly appreciated!!"
Most if not all allocation funds have a bond component. In my experience I have bought short duration funds to complement the fund plus income funds as additional protection. Of course that may or may not work but I didn't want to stay with the generic bond fund these MA funds usually hold.
http://financials.morningstar.com/fund/management.html?t=BRUFX®ion=usa&culture=en-US
There is no cash position other than the internal cash held by the fund so you are always fully invested in the fund which probably helps contribute to the low turnover mentioned by @NumbersGal.
How is that different from other funds?
At some point I would like to sell shares of BRUFX and holds these proceeds in a cash position (in hsa status) for disbursement at a later point in time. A cash position would also allow me the flexibility to "dial up to" the manager's allocation (including his cash) or "dial it back" with my cash position, but still within the structure of the hsa.
Get it?
if you already own BRUFX at Bruce, can you transfer your holding in its entirety to another HSA, ie, Saturna, TD, etc...thereby allowing you to sell shares and hold the cash as necessary?
(anyone who does 'disburse' correctly is smart in my book)
BRUFX is a lone wolf and I like that. I just want a d#mn cash account too. I've reached out to Bruce about this, but it's not a deal breaker where I resort to another hsa option.
I have an account similar to that at Altegris (private equity and hedge funds). Sometimes I like the fact that it's not that accessible...I have a tendency to mess with my funds at Schwab. But, I always get a little nervous when I deposit money at Altegris because I can't control when it goes into the funds. And I like to average in and average out...not dump a big slug of money at once.
For the OP, BRUFX is a fine choice. Just realize that investing in the Bruce Fund has it's nuances that are a bit more "old school".
Each brokerages have different agreements with the mutual fund companies on the investment minimum and for different types of account.
Is that Maximum Drawdown of 36.5% for PRWCX historical or hypothetical? Honestly, I can't remember it ever dropping that much. Possibly in '08 with some recovery near year's end?
The other one I'm familiar with is OAKBX. On that one the managers like to make bold calls. That might be overweighting Treasuries (a decade ago) or buying GM when it was depressed last year. So, the risk metrics don't really tell you much. It could be a "2" this month and a "4" a month or so later depending on their views of the markets.
I found it amusing that Friday every one of my dozen funds (income, commodity, equity) was in the green - except for (over-hyped) PRWCX which lost a fraction. You never can tell.
Kevindow, thank you for performing the test purchases, too bad! The down side of your suggestion is that I do not know anybody who owns PRWCX. Also, it is not very tax friendly and I'm looking to put this fund in an IRA.
JohnChisum, I would greatly appreciate any suggestions for short duration and/or income funds for me to consider and investigate?
VILLX is very volatile; I know it has performed well but I do not need to have the best performing MA fund. I want something that is a little less volatile with solid returns and other metrics. With a 5-year SD of 11.8 (per M*), I should be able to find a stock fund with better returns.
I will have to check out BRUFX; I have heard of it but know very little about it.
Once again, thank you all for your thoughts and suggestions!! Matt
Aww, man....so I didn't have to give away my first born child to Schwab to buy TIBIX??
At present I like to get into Seafare G&I, institutional share, but don't have $100K and there is no work-around this yet.
Since my holdings are all with American Century, my suggestions would be narrowly focused. I hold ASDVX for the short duration unconstrained bond. AMJVX is their multi-asset income fund and ALNNX is their alternative income fund which I use as a complement to AMJVX.
For short duration, I like the template my fund has. < 2 years duration. Unconstrained gives the fund management more leeway as where to go.
For income funds, I also favor the anywhere style of unconstrained and multi-asset. The markets of today are complicated with various types of investments. As I mentioned above, I use ALNNX as a complement. There are some duplicate strategies between both funds but ALNNX includes hedging and other strategies. The way it performed in this past downturn was impressive, but that is also just one event. With the bond markets as they are investors have to change their thinking somewhat as being in longer term bonds during a period of rising rates will surely be counterproductive.
These strategies are relatively new and M* doesn't classify them properly. Running some Google or Bing searches may provide more answers.
Edit: BlackRock has a decent offering in the multi-asset income sphere. BAICX.
http://www.blackrock.com/investing/products/227565/blackrock-multi-asset-income-inst-class-fund