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.
Like others, I was surprised to see the Sequoia prospectus excerpt that David S posted. Not so much because it warned to expect redemption in kind (which is exceedingly unusual), but simply because it gave rules - over $250k in 90 days.
Yet (keepi…
Right on topic, actually. Both the original proposal and the final rules were designed to allow the current models of compensation to continue. So brokers are still allowed to collect loads. No change when viewed from the mechanical perspective…
My final comment on this, since I've identified a relatively short section of the original proposal that shows what did and didn't change.
Here's an Investment News article talking (correctly) about how non-traded REITs magically appeared in the fi…
Vanguard is not that hard to deal with in theory. One needs to recognize that they are meticulous about following (and creating) rules. If one knows all the rules beforehand and plans on their being followed to the letter, things will go fine.
R…
No experience with trusts (though I did open an estate account with them), but here's where it seems you can find an account form:
- On the Vanguard (personal investor) home page, look to Forms at top right
- On the forms page, "open a nonretirem…
If it were Obamacare for financial planning, the government would be subsidizing advice for most households. But then how could one say it was too expensive for "families with modest bank accounts"?
Don't think too much, it will only make your he…
See thread on equity-linked annuities:
http://www.mutualfundobserver.com/discuss/discussion/26891/rules-for-indexed-annuities-face-an-unexpected-tightening
From the WSJ article referenced there (and in Ted's summary):
"The final rule issued by the …
One other thought on perspectives. If we had a sane Congress, we'd be hearing Republicans cheering Obama's nomination for Supreme Court justice. In the past, he'd been identified as the best the Republicans could possibly hope for from a Democrat…
@BobC - The original regs excluded VAs from PTE 84-24. The final regs exclude VAs from PTE 84-24. The original regs allowed VAs in BICE. The final regs allow VAs in BICE.
I don't disagree that DOL made some changes to accommodate the financial…
Ted, you often link to US News and World Report rankings. Do you know the dates of their data? They still show a 4 star M* rating for RPHYX, while the current rating at M* is 3 stars.
So that should give you a small window for the downgrade.
…
As David wrote, here you have an ultrashort bond fund thrown in with typically long duration funds because that's the only collection of taxable junk bonds. RPHYX has to be included somewhere, else it's in a collection with no other funds which mak…
A curious juxtaposition - a completely liquid MMF (even more liquid than a savings account) and a CD with a redemption fee (except at maturity).
Personally, I prefer I-bonds to 1 year CDs. What I give up in short term liquidity (no redemptions…
"But somehow non-traded REITs, variable annuities, and other high-commission products (things that were not in the proposed regs at one point) are now back in."
Could you suggest where a VA exemption was broadened from the original DOL proposal? I…
@Ted - you don't need Jaffe to help you look like an idiot, you can do that all on your own :-)
(Sorry, couldn't resist, no disrespect intended.)
Will be interesting to read his response.
Maybe all that Jaffe did was roll the date on the column - it is now dated April 6th, but check Ted's link: 2016-03-29 in the URL.
Been there, done that (and commented). Here's Ted's March 29th link to what seems to be the same column:
http://ww…
You can also convert to ETF class shares (except for four of Vanguard's bond ETFs), one way only.
Since Admiral and ETF class shares yield the same (and it costs less to trade Admiral shares, even at Vanguard), I don't recommend this. But it d…
Good clear questions. Let's see if I can provide equally clear answers ...
1. Here's a three part answer:
a) Core funds (see also answer #3 below for explanation of core accounts):Vanguard gives no choice, there's only Vanguard Fed MMF (VM…
Some time ago, it seemed that Vanguard stopped offering Admiral shares through all brokerages. Since then, Admiral shares have started reappearing at some brokerages, e.g. TDAmeritrade.Scottrade.
Keep in mind that some Vanguard funds may be close…
Sorry, bad HTML - try this:
http://mutualfundobserver.com/discuss/discussion/26328/money-market-funds
The relevant section (emphasis added):
These are all "prime" funds, meaning that come October they will have to impose liquidity constraints. I…
Well, I was also hypothesizing, so I hope my thinking made sense.
I think by "index" here you mean a fund tracking the index. Remember the standard disclaimer - "you cannot invest directly in an index."
I know people think that index funds can be…
Summary ... Retail MMFs (whether at a brokerage or elsewhere) will not be required to float. Fidelity has converted some of its funds (notably FDRXX) to government (not Treasury) MMFs so that they may be offered to institutions as well as retail cu…
Somewhat dated info, but here's our old thread on this:
http://www.mutualfundobserver.com/discuss/discussion/6824/health-savings-accounts-hsa-and-mutual-funds
HSAs tend not to be sizeable accounts and they have paperwork requirements. As a result…
I believe price discovery can take place even with only indexers. But what is "discovered" is only the value of the index (or market) as a whole. If investors feel the market is underpriced (even if individual components are overpriced), they wil…
The Share Price segment laments the overabundance of share classes and their various associated fees. I'm going to try approaching this from the other end - what services do you get and how should they be paid for?
There are account servicing cos…
I'll have some comments in the main thread on this month's commentary. Since you asked about MMFs, I'll provide a few notes here.
No MMF, not even one containing only Treasuries, is guaranteed not to break a buck. That's true now and will alway…
The management (not ER) fee on FCNTX is 0.56%. On $107B, that's about $600M. Let's say Danoff gets half of that, or $300M. That's not even beginning to count his pay for managing New Insights and lots of other funds.
SEQUX's management fee is …
I agree that asset bloat is a potential problem, but more to watch out for than a reason to rule out MWTRX now - especially in a tax-sheltered account where switching funds is painless.
As a reference point, posts here have had only positive words …
BIV/VBILX/VBIIX also has noticeably more treasury exposure than AGG. It's basically AGG if you restrict in two ways: 1) limit to intermediate term bonds (those with maturities in 5-10 years), and 2) remove securitized bonds (about 1/4 of AGG). …
"It's not just what happened lately".
To repeat my point, what happened lately (if there's a sizeable performance difference) distorts comparisons in all time frames. If it's not just what happened lately, let's throw out the past year (4/1/15 …
Also, N shares will remain open to new shareholders who purchase directly.
I'm wondering whether PRPFX will remain NTF at brokerages. If it does, the N class shares will remain available to new shareholders who purchase through brokerages. Often…
Looking at cumulative returns (1, 3, 5 year) is good, but it's also informative to look year by year. If the last year has been particularly good (or bad), it can skew all the numbers. Just look at Sequoia (SEQUX).
As with that fund, if the las…
"Not exactly a DFA fund wrapped into an ETF"
DFA insists that their funds are not index funds, because of their flexibility in how they track their proprietary indexes. They don't have to have the same securities or even securities selected from …
David - thanks for the comments.
I've a relative in a large system (R3 shares) with RAs, SRAs, GSRAs. 403(b)s and 401(a)s. Some frozen, some without exchange options. No way I've been able to make sense of all of this, and I've sat in on a …
"The Fund will remain closed to prospective financial advisory and intermediary clients (other than clients who invest through a Vanguard brokerage account) until further notice, and there is no specific time frame for when the Fund will reopen for …
From the first article:
"Jack Bogle in an interview with CNBC ... defended Labor's initiative to craft a new fiduciary standard for all investment advisors."
"Vanguard wants to see a substantially simplified Best Interest Contract Exemptions, a mo…
The column contains several quotes from our esteemed Professor Snowball, for whom I have a question: What do you think about TIAA-CREF's splitting the CREF funds into three share classes (R1, R2, R3)?
(TIAA was still called TIAA-CREF when it sp…
Most of Jaffe's shots at any DOL regulations would apply to current fiduciary regulations, so I guess he's saying that we should get rid of fiduciary duties altogether, including for those professionals already acting in the clients' best interests.…
