https://stockdailydish.com/emerging-markets-land-top-of-managers-portfolios-with-rising-rates/
Emerging markets land top of managers‘ portfolios with rising rates
By David Randall
NEW YORK, March 24 (Reuters) – Rising short-term interest rates in the United States are prompting Lipper Award-winning bond fund managers to add emerging-market debt and non-agency backed residential mortgages that they say offer more potential for gains in the year ahead.

TRP was great about updating PRWCX to reflect true value (Saturday morning). Still waiting for laggard Invesco to do the same for one that donutted there Friday. Not that it makes one iota of difference to me - and perhaps most of us.
It may, of course, have some impact on your year-end balance and therefore some effect on your RMD for 2020.

MikeM: I don't want to 'buy the distribution' and incur a further tax cost .. a lot of people rush to buy OEFs at the end of the year as they rebalance (I don't rebalance) and then get surprised when the fund which they just bought sends them a 1099 with potentially large gains in February. So by waiting until it pays out, I am avoiding increasing my tax costs this year. The ex-day is easy: as estimates on my funds are announced, I mark my calendar and put my buy orders in that day.

@rforno, something I've heard you or others do before, but why does it matter waiting to buy until after distributions were distributed. Isn't it just a balancing act for the fund? I don't see the positive effect buying before or after distributions, or am I missing something?

@Crash: From Bee.
What You Need to Know About Capital Gains Distributions

...Yes. I'm aware. I still have not taken a penny from my Trad. IRA in TRP. So, no tax due, yet. All my TRP stuff is Rollover (Trad, not Roth) IRA. Thanks.

@Crash: From Bee.
What You Need to Know About Capital Gains Distributions

Hi guys,
Since, I am retired and in the distribution phase of investing I like my portfolio to generate ample income to meet my needs. In this way, I do not have to sell assets to meet cash distribution needs.
In addition, I also look at it in this light. I look at each share owned in a mutual fund much in the same way a farmer looks at an acre of land. While the share/acre is in production it generates some form of income or growth in most cases. Start selling shares/acres to raise cash then pretty soon nothing is left to generate the needed production.
By the way ... even in retirement ... I'm growing my number of shares/acres owned thus increasing my production. And, income generation is a part of this production along with growth of capital.
I agree with hank's comment ... "To each his own."
Is it not great that there is no one way to success (or failure) in investing?
Old_Skeet

A further look: TRVLX (TRP Value, because the money I watch for a colleague includes that fund.) TRVLX paid $0.64 cents, but it was (strangely?) all INCOME, no cap gains. I wonder why?

Going....going....almost gone.
On the main "Quote" page of every fund covered by Morningstar is a chart showing the growth of $10,000 over the last 10 years (for funds that are 10 years or older). In 18 days the return figure for 2009 will disappear. For many funds, especially in the technology and growth sectors, this will make an enormous difference to their headline 10 year total return.
For example, FSELX returned an astonishing 85% in 2009. Yet in the decade since it has frequently lagged its category. Its standout performance in 2009 clearly contributed massively to its 10 year total return of almost $102,000.
https://www.morningstar.com/funds/xnas/fselx/quote
Personally, I'll be glad to see the figures for 2009 disappear. They have distorted the performance of many, if not most, mutual funds and ETFs. Hopefully, a more accurate picture will emerge from 2020 onward.
Wishing everyone here a very happy holiday season.

Is that dividends or cap gains or both???

Everybody makes some excellent points. There are two different ways of looking at allocation that might be muddling the messages here. If “allocating” between taxable and tax-sheltered accounts (like IRAs) than it makes sense to keep income generating assets in the tax-sheltered vehicles, as income is normally taxed at higher rates than long term cap gains.
What I have difficulty understanding sometimes is: within a total portfolio why it’s necessary to differentiate between the income producing assets and the rest? As @bee points out, what you really care about is total return. Now, albeit, income producing assets might possibly help smooth out the ride - making total return less volatile and more predictible on a yearly basis. But that really gets us into the second way of viewing allocation - as a way to reduce risk and volatility. So, while I now devote 25% of my IRA to two income producing funds (RPSIX, DODLX), it’s done strictly out of a desire to lower the downside risk and achieve more stable year-year total returns. That they churn out income isn’t what’s appealing to me. It’s the lower volatility and the fact that bonds often “zig” when equities and other asset classes “zag.”
To each his own. If your method works for you, that’s what’s important.

@MikeM - I'm having trouble following your reasoning. First off, many of the REIT investors I know of are not consumed by TR nor do they view it as the 'be all to end all'. It's always nice if they get it but they're more interested in the income stream REIT's provide. Buying REIT's when they've been beaten up can be rewarding (however now is not that time). Bonds and bond funds are also capable of gyrations.
Second, I don't understand this statement you made at all "... but buying them for their income distribution inside a tax deferred account doesn't have much meaning." The REIT's I own are all stuffed in a Roth IRA precisely to avoid income taxes on the distributions generated. I can also sell them free of capital gains taxes when prudent. What am I missing? According to M* buying REIT's in tax deferred accounts is the best place for them.
I meant to add this section from Bees' earlier linked capital gains distribution article:
"Consider Asset Location
Ultimately, an investor's best weapon against unwanted taxable income or capital gains distributions is to pay attention to which assets you hold in tax-deferred accounts (such as 401(k)s and IRAs) versus taxable accounts (such as brokerage accounts). Certain types of investments tend to be less tax-efficient because they are more likely to pay out taxable income or gains than others. These include high-turnover actively managed funds, some types of bond funds including high-yield corporate-bond funds, and REIT funds. Such holdings are a better fit inside of a tax-advantaged account such as a 401(k), IRA, HSA, 529, and the like. By contrast, municipal-bond funds as well as many index funds and ETFs can be good choices for taxable accounts."

An alternative view:

An important aspect of this conversation is that, while REITs provide a higher level of income than most other stocks, income from investments is not, in itself, a useful goal. Rather, it’s total return that matters, because capital appreciation can be used to fund living expenses just as well as income can. For instance, in a given year, if a given mutual fund provides an 8% total return, it does not matter whether the return is 8% from income and 0% from capital appreciation, 8% capital appreciation and no income, or any other combination in between.
An important exception is that if we’re talking about a taxable account (as opposed to retirement accounts such as IRAs or 401(k) accounts), income is actually detrimental relative to capital appreciation, because it results in an immediate tax cost rather than a deferred tax cost. And as a result, it can even make sense to underweight REITs in taxable accounts.

Link to Article:
overweighting-reits-why-dont-more-experts-recommend-it

@TheShadow...thought this article did a good job of explaining capital gains distributions as they relate to mutual funds
what-you-need-to-know-about-capital-gains-distributions

I have owned the Fidelity Real Estate Income Fund (FRINX) for about seven years with it being a member of my hybrid income sleeve. Thus far my total return in the fund has averaged a little better than 9% per year with an income yield of a litte better than 4%. With this, I've had some capital appreciation in this position during my seven year holding period as well as the production of income in the form of dividends and capital gain distributions pusing my income distribution yield upwards and north of 5%.
According to Xray this fund's asset allocation is listed at 7% cash, 30% US stocks, 1% foreign stocks, 38% bonds and 8% other (most likely convertibles and preferreds). I'm thinking that the referenced stocks are actually reits. As I write, according to M*, it is off its 52 week high by 1.42%.
In checking this fund at MFO it carries a MFO rating of 5 (best), a risk rating of 2 (conserative) and a bear market rating of 1 (best).
For me, this is a nice income generating fund and one that I plan to add to my position over time as I grow the income area of my portfolio.

I agree with @hank that a lack of narrative is disappointing. I have thought well of Brown Capital and own two of their funds. However, they are among those funds who offer nothing but stats in the semi-annual report. In the case of BCSVX, I wanted either reassurance or an explanation about middling recent performance. I got nada. Now I am glad I shifted two-thirds of my position to ARTJX without waiting to hear from the managers. DF Dent, by contrast gives me great rationales for what they’re doing and my money does not wander. FMI is another firm that provides really meaty reports. In my experience, fund companies are all over the lot in their commitment to treating investors as partners. Fortunately, it’s easy to vote with our feet.

" And we know what happened to the ACA"
I wonder. Every time I look at provisions of the ACA, I go, oh yeah, I'd forgotten about that. For example, the tax on insurers. No one knows what's going on with that:

The health insurance tax was in effect from 2014 through 2016. Congress approved a one-year moratorium for 2017, and the tax resumed in 2018 at a cost of about $14.3 billion. Congress suspended the tax once again in 2019. If not further delayed, it will be collected again beginning in 2020.

https://www.healthaffairs.org/do/10.1377/hblog20190910.985809/full/
Regarding who owns munis: Munis were never great investments for much of the middle class. Most of the time, if you were below the 31% tax bracket, you'd have been better off investing in taxable bonds. This is reflected in the statistic that even 30 years ago (1989) fewer than 1 in 20 owned munis.
Rational middle class investors have been getting pushed further out of munis for a long time. Obama made the Bush tax cuts permanent for the middle and lower classes, making munis less attractive. Then the GOP moved even more middle class taxpayers into a 24% or below tax bracket (ordinary taxable income below $160K [single] / $321K [MFJ]).
One can't have it both ways - advocating lower middle class marginal rates and simultaneously bemoaning the fact that munis consequently become less attractive. So long as taxpayers in the highest brackets keep buying munis, states will continue to be able to borrow at lower rates and fund needed work on century-old infrastructure systems.

pipes can range from 15 to 100 years old depending on conditions, although some older northeastern cities operate with pipes that are 200 years old.

America's Aging Water Infrastructure

https://money.usnews.com/investing/funds/articles/top-t-rowe-price-funds-for-retirement
6 Top T. Rowe Price Funds for Retirement
T. Rowe Price funds can add diversification to a retirement portfolio.
T. Rowe Price Retirement 2030 Fund (ticker: TRRCX)
T. Rowe Price Retirement 2040 Fund (TRRDX)
T. Rowe Price Capital Appreciation Fund (PRWCX)
T. Rowe Price Blue Chip Growth Fund (TRBCX)
T. Rowe Price Mid Cap Growth Fund (RPMGX)
T. Rowe Price Health Sciences Fund (PRHSX

You are correct that funds subtract expenses before paying you a div. But they generally don't pay US or state income taxes on their earnings. Instead, they pass that income through to you, so you alone pay the taxes.
As Fidelity explains: "funds that have net gains from the sale of securities or earn dividends and interest from securities they hold must pass the largest possible portion of those earnings on to its shareholders or those gains will be subject to corporate income taxes and excise taxes. These taxes would, in effect, reduce your total return."
What tax efficient can mean for a mutual fund is that it doesn't generate (much) income, so it passes almost no income to you to be taxed. For example, it may own non-div paying stocks that simply appreciate. And it may also avoid cap gains by harvesting tax losses or simply not trading much.
With these tax efficient funds you don't get much in the way of divs. Instead, their NAVs go up over time. You don't owe taxes until you sell your fund shares and realize a cap gain.
Muni bond funds are said to be tax efficient as well. Not because they don't generate income that they pass through to you, but because that income that is passed through is tax-exempt.

Thanks @msf, but not sure that answered my question. Maybe I didn't state it properly.
I'm not talking about what I pay for taxes when i withdraw the money from a tax defered account. I'm talking about the total return growth of the mutual fund if the fund is getting yield tax free.
I've heard that there are tax efficient mutual funds so on the other hand there must be less efficient funds. A regular bond mutual fund (say a corporate bond fund) pays taxes on their gains when they sell or when the individual bond matures inside the fund, is that correct? That tax, I would guess, is subtracted from total return. So if a mutual fund is holding a tax free bond I would assume the profit on that tax free bond is tax free for the fund. Wouldn't that, the fund not paying tax on the muni bond yield, increase total return of that muni bond fund?

The idea that the president could make munis taxable is dubious at best. The executive branch (including the IRS) generally, and the president specifically, can change regulations and policies only to the extent that the changes remain consistent (do not contradict) existing laws.
The Internal Revenue Code, section 103 states succinctly that with three exceptions (in 103(b)), interest paid on state and local bonds must not be taxed.
Congress certainly has the power to pass legislation making some or all muni bonds taxable. It did this in creating Build America Bonds. Congress enacted Section 54AA of the IRC, which says that if not for Section 54AA, the bonds would be tax exempt under IRC 103, as described above. That is, BAB bonds are, by a specific law, not tax-exempt.
It would take an act of Congress to make muni bonds generally taxable. The president cannot do this by fiat.
From a strictly pragmatic perspective, Congress is barely able to pass appropriations bills before the government again runs out of money in a couple of weeks. And this is the legislative body you fear will proactively take away the tax-exempt status of muni bonds?
Even if, against all odds, Congress did come together and pass some such bill, what would it look like? Would it revoke the tax-exempt status of current muni bonds> Or would the possibility that such a change might be unconstitutional prod Congress into taxing only bonds issued in the future (as was done with advance refunding)?
If so, then what do you see as the risk to currently outstanding munis? ISTM that by preserving their tax exempt status but drying up the supply of future tax-exempt munis, Congress might make current munis even more valuable. A double win for current bond holders - tax exempt interest and capital appreciation. As an investor, I wouldn't mind getting stomped on by that elephant.
As a taxpayer, the prospect of having to pay 40% more to get infrastructure does not please me. But that's a different matter altogether.