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.
I have a taxable account with Dodge and Cox international DODFX and Oakmark Inter OAKIX Looking to add to international. I was going to add to both funds but would like some diversification into other funds for my taxable portfolio.
Adding an emerging markets fund can arguably decrease diversification, at least if one starts with the premise that maximum diversification is the total market. Overweighting one portion of the market is thus decreasing diversification (taken to its extreme, that would be eschewing other portions of the market - clearly not diversifying).
Vanguard Total International Stock Index (VGTSX, among other symbols), which should be representative of the total international market, has about 18% in emerging markets. Dodge and Cox has about 22%. Oakmark has virtually nothing (2%). All per M*. Depending on the mix, prinx may already be reasonably diversified into emerging market. (Wide ranging portfolios is something I look for, which is why D&C is on my short list.)
I tend to agree more about adding small cap, though here too, Oakmark tends to avoid emerging markets. I might look at something like Acorn Int'l (ACINX) - that seems to be available NTF at Scottrade (as well as elsewhere). More growth leaning than Oakmark or D&C, could serve as a counterbalance in both market cap and style, while maintaining a healthy 20%+ exposure to emerging markets.
There's lots of international funds to choose from. Can you give us a little more description for what you are looking for. Here are a few of my favorites:
HIINX Harbor International UMBWX Scout International MAPIX Matthews Asian Dividend
Since your funds (both first-rate) tend toward large and value, you might consider smaller and growthier.
Scout International Discovery (UMBDX) would be a relatively mild way of gaining access to a volatility category. Driehaus International Small Cap Growth (DRIOX) would be a relatively wild way to do so.
Other options might include a frontier markets fund (hmmm . . . Harding Loevner is one of the few no-loads, but it's pricey and institutional). Maybe an Africa fund?
Following David's thought of smaller and growthier, consider:
Artisan International Small Cap (ARTJX) if you are able to get into it -- a venerable choice with a strong long-term record. It is unclear to me what effect, if any, the planned IPO by Artisan Partners will have on their funds.
Vanguard International Explorer (VINEX) is another venerable choice with a good long-term record. For what it's worth, this is the one I use in my 403b at work.
Another relatively new and I think intriguing choice would be the Vanguard FTSE All-World except US Small Cap Index fund (VFSVX) or ETF (VSS). This one has about 14% emerging markets, per the Morningstar fund portfolio.
I second David on Scout Int'l Discovery Umbdx (high ER, but very low level of assets, all-cap, & has beaten its older sibling Scout Int'l Umbwx handily since inception), Rono on Matthews (Mapix since Macsx is closed), and Greg on the Vanguard-FTSE fund/etf, plus consider T. Rowe Price Int'l Discovery Pridx- good long term record, plenty of Asia and EM - IMHO, the best of T. Rowe's international funds.
Sine your two funds are large cap value (I like Oakmark, but am not a fan of D&C), I would suggest something that owns smaller companies and also something that is more growth oriented. To this end, you might consider Ivy International Core Equity (IVVYX), Baron International Growth (BINIX). If you want some EM exposure, I would consider Matthews Asia Dividend (MAPIX) - about 30% EM stocks. Or move to something more aggressive like Wasatch EM Small Cap (WAEMX) for a small piece of your International Equity dollars.
I was considering ACINX , acorn international because it seems to have a favorable Tax efficiency and its ER is not great relative to other internationals. What is your opinion? Burt S.
VINEX is actively managed by a team from Schroeder's and a second team from Wellington currently managing a relatively small portion of the fund. The addition of the team from Wellington in 2010 might now be seen as a mild argument against this fund.
But I think what you meant to refer to is the relatively new Vanguard FTSE All-World ex-US Small Cap Index. I understand your concern. I admit I am not investing in this one myself yet. I just have emerged from a period during which I had little time for investment issues; during that time I reduced risk across the board, divested myself of major investments in all but my highest conviction fund holdings, and stuck with index funds and funds with long-term stable records and management. Even so, when I reemerged, I found I remembered asset allocation ideas a lot better than I did specific nuances of fund selection. And for all actively managed funds, I kind of have had to play catch-up with the ins and outs of management changes, corporate ownership etc.
So I wanted to include an index fund as an option. Holdings in index funds are more tolerant of investor gaps in attention -- there are fewer surprises in both directions.
If you can stand the RISK/REWARD profile (High/High) and the fund you're seeking doesn't have to be exclusively overseas, look at RIVFX. (Royce Global "Value.") It is operating as a mid-cap growth entity these days. On Thursday, it just touched a new 52-week high. Maybe wait until it falls a bit? Cash in the fund is 14.57%. USA portion is 21% and Foreign is 65%. Biggest single holding by far is State Street Bank and Trust. Other countries include: Japan, Switzerland, UAE, Austria, Australia, Canada, Hong Kong, South Korea. I wish the volatility factor was lower. But I can't complain about owning RIVFX shares!
Hi Max Glad to see a familiar face. RIVFX has nice record. But it has a 1.69% ER . I am trying to hold the expenses down to below 1.35. Although lately I have been thinking that the the total return is net the ER. I am more flexible. I did my first ETF trade yesterday and I got over the hump learning how to put in limit orders. Fidelity was very helpful. Burt S.
Yes I have RIVFX as well and really like it as a go-anywhere global small-midcap fund.
By the way, according to their website, the fund actually has 10% in "Treasuries, Cash & Cash Equivalents" as of 3/31/11.
Their value investing style is complementary to other value type of funds (which is what i like) because most of the Royce funds (at least in the last few years) don't fall into the M* value side of the boxes. But nevertheless they have done very well. Remember that Stock A could have a PE of 13 and Stock B could have a PE of 17...but Stock B could actually be the better 'value' buy if say its Earnings to Enterprise Value indicated it was a much more attractive and bargain than Stock A.
I'm ok with holding it because overall on the portfolio level my wife and I have a pretty good hold on fees because we also use hold a good chunk in Vanguard funds. As an example, their Midcap Index fund (10-years as of 3/31: +8.86% annualized) has razor-thin expenses and good performance and there are other funds they have such as Wellington, Wellesley, Primcecap Core, EM Index, etc. in the same boat. I also use the Wisdometree EM dividend etfs which lowers costs quite a bit relatively speaking to the EM space because most funds here are expensive yet don't offer much in terms of outperformance. So I look at the bigger picture as to what I'm doing --- and so feel good that I can hold some higher expense funds where I really really want to.
Kenster I am becoming more and more to your thinking. I too hold the Vanguard Midcap index and also the artisan Midcap ARTMX and have been very happy with the results. Although I am getting more higher end expense funds it is only a small part of my portfolio. I still refuse to by load funds. Also 1.69& in RIVFX is still a little to rich for me for ER.
About the high ER: you're correct, of course. I bought into that fund (RIVFX) when it was in its infancy. M* didn't even rate it, yet, when I started buying shares, a little bit each month, month after month. I've since STOPPED buying shares in it. When it runs hot and very profitable, I let it run up. Then after a pre-determined level is reached, I raid RIVFX and put X amount into RYDVX. I might not have chosen that fund (RIVFX) at the beginning if I knew that it came with a HIGH risk profile according to Morningstar. But its performance over the last several years makes up for its high ER, it seems to me. There have been funds I've owned---like TAVIX Third Ave. Int'l----- which came with a high 1.75% ER, though the ER was lowered along the way........
Max do you own any ETFS? What is your opinion on them as a mix in your portfolio. I am usually a buy and hold guy but I noticed that Fidelity and Vanguard are clamping down on so called short term holding periods with costly redemption fees. Sometimes I do feel that I want to get out of a fund for some reason or another even though my main thrust is a long term approach. With ETFs that is not a concern.
I've never held any ETFs, to tell you the truth. And I've only held a single closed-end fund: IRL. That was YEARS ago, back in the 1990s. I did alright with it, just a small profit. I had to sell it before I wanted to. These days, I'm just keeping things simple. I'm happy with my selections, and am letting them ride, although not EVERY day is wonderful. These are all open-ended funds: MACSX (closed to new investors for the time being) MAPIX RYDVX RIVFX PREMX PRLAX PRSVX
I've tried to find funds which are acceptable to me that belong to the same fund-house, so that I don't have 23 different statements to keep track of, you know?
As for ETFs, surely there is room for that. I don't even really have an opinion about those things. Fees are low, so I understand. But my impression is that ETFs might as well be individual stocks, the way they are bought and sold. Hell, what am I talking about? .......
My favorite fund in TRP is Capital Appreciation PRWCX. I use it as a core fund along with permanent PRPFX. The other part of my core is BERIX and FPACX. One notch above my core I add some of the funds you like such as MACSX and MAPIX. ( I think I learned about the latter 2 from you from you Max)' The TRP fund that I have been adding to over the past year is PRHSX Health Sciences. I do have a nice few small caps such as Fidelity Small Cap discovery and Heartland valur Plus HRVIX. A few weeks ago I reluctantly sold my stake in Fairholm FAIRX as I have done very well over the years with Berkowitz but the critiques on FA were too persuasive for me to hold. That could be a mistake as Bruce is a proven winner. I am almost retired and felt I could not feel comfortable for him to work out ST Joe and the financials. But my gut feeling is that he will. Burt S.
Comments
If you want some more diversification, you might want to add an emerging market fund and/or International Small Cap fund (OAKEX)
Vanguard Total International Stock Index (VGTSX, among other symbols), which should be representative of the total international market, has about 18% in emerging markets. Dodge and Cox has about 22%. Oakmark has virtually nothing (2%). All per M*. Depending on the mix, prinx may already be reasonably diversified into emerging market. (Wide ranging portfolios is something I look for, which is why D&C is on my short list.)
I tend to agree more about adding small cap, though here too, Oakmark tends to avoid emerging markets. I might look at something like Acorn Int'l (ACINX) - that seems to be available NTF at Scottrade (as well as elsewhere). More growth leaning than Oakmark or D&C, could serve as a counterbalance in both market cap and style, while maintaining a healthy 20%+ exposure to emerging markets.
HIINX Harbor International
UMBWX Scout International
MAPIX Matthews Asian Dividend
Scout International Discovery (UMBDX) would be a relatively mild way of gaining access to a volatility category. Driehaus International Small Cap Growth (DRIOX) would be a relatively wild way to do so.
Other options might include a frontier markets fund (hmmm . . . Harding Loevner is one of the few no-loads, but it's pricey and institutional). Maybe an Africa fund?
Just noodling,
David
I'd add some Asia via one of the Matthews funds like MACSX or MAPIX. Another possibilty after this addition would be either EUROX or TREMX.
peace,
rono
Artisan International Small Cap (ARTJX) if you are able to get into it -- a venerable choice with a strong long-term record. It is unclear to me what effect, if any, the planned IPO by Artisan Partners will have on their funds.
Vanguard International Explorer (VINEX) is another venerable choice with a good long-term record. For what it's worth, this is the one I use in my 403b at work.
Another relatively new and I think intriguing choice would be the Vanguard FTSE All-World except US Small Cap Index fund (VFSVX) or ETF (VSS). This one has about 14% emerging markets, per the Morningstar fund portfolio.
Just some food for thought.
gfb
Tax efficiency and its ER is not great relative to other internationals. What is your opinion?
Burt S.
VINEX is actively managed by a team from Schroeder's and a second team from Wellington currently managing a relatively small portion of the fund. The addition of the team from Wellington in 2010 might now be seen as a mild argument against this fund.
But I think what you meant to refer to is the relatively new Vanguard FTSE All-World ex-US Small Cap Index. I understand your concern. I admit I am not investing in this one myself yet. I just have emerged from a period during which I had little time for investment issues; during that time I reduced risk across the board, divested myself of major investments in all but my highest conviction fund holdings, and stuck with index funds and funds with long-term stable records and management. Even so, when I reemerged, I found I remembered asset allocation ideas a lot better than I did specific nuances of fund selection. And for all actively managed funds, I kind of have had to play catch-up with the ins and outs of management changes, corporate ownership etc.
So I wanted to include an index fund as an option. Holdings in index funds are more tolerant of investor gaps in attention -- there are fewer surprises in both directions.
gfb
Glad to see a familiar face. RIVFX has nice record. But it has a 1.69% ER .
I am trying to hold the expenses down to below 1.35. Although lately I have been thinking that the the total return is net the ER. I am more flexible.
I did my first ETF trade yesterday and I got over the hump learning how to put in limit orders. Fidelity was very helpful.
Burt S.
By the way, according to their website, the fund actually has 10% in "Treasuries, Cash & Cash Equivalents" as of 3/31/11.
Their value investing style is complementary to other value type of funds (which is what i like) because most of the Royce funds (at least in the last few years) don't fall into the M* value side of the boxes. But nevertheless they have done very well. Remember that Stock A could have a PE of 13 and Stock B could have a PE of 17...but Stock B could actually be the better 'value' buy if say its Earnings to Enterprise Value indicated it was a much more attractive and bargain than Stock A.
I too hold the Vanguard Midcap index and also the artisan Midcap ARTMX and have been very happy with the results. Although I am getting more higher end expense funds it is only a small part of my portfolio. I still refuse to by load funds.
Also 1.69& in RIVFX is still a little to rich for me for ER.
Burt S.
What is your opinion on them as a mix in your portfolio. I am usually a buy and hold guy but I noticed that Fidelity and Vanguard are clamping down on so called short term holding periods with costly redemption fees. Sometimes I do feel that I want to get out of a fund for some reason or another even though my main thrust is a long term approach. With ETFs that is not a concern.
Burt S
MACSX (closed to new investors for the time being)
MAPIX
RYDVX
RIVFX
PREMX
PRLAX
PRSVX
I've tried to find funds which are acceptable to me that belong to the same fund-house, so that I don't have 23 different statements to keep track of, you know?
As for ETFs, surely there is room for that. I don't even really have an opinion about those things. Fees are low, so I understand. But my impression is that ETFs might as well be individual stocks, the way they are bought and sold. Hell, what am I talking about? .......
One notch above my core I add some of the funds you like such as MACSX and MAPIX. ( I think I learned about the latter 2 from you from you Max)'
The TRP fund that I have been adding to over the past year is PRHSX Health Sciences.
I do have a nice few small caps such as Fidelity Small Cap discovery and Heartland valur Plus HRVIX.
A few weeks ago I reluctantly sold my stake in Fairholm FAIRX
as I have done very well over the years with Berkowitz but the critiques on FA were too persuasive for me to hold. That could be a mistake as Bruce is a proven winner. I am almost retired and felt I could not feel comfortable for him to work out ST Joe and the financials. But my gut feeling is that he will.
Burt S.