Jerry
Vanguard tax managed capital appreciation is a great fund but it is a closed fund.I have VTMSX which is a tax managed small cap but it is no better than Vanguard small cap index fund. Do you have any other tax efficient funds that you can recommend ?
prinx

Hi, guys.
In response to DavFor's request, a bit of info on what's up behind the scenes.
It's been a busy year. The Core Four (Ed, Charles, Chip and me) met in Chicago last fall, after the Morningstar ETF Conference. There was a sense that I needed to try to create an enduring legal and financial structure for the Observer. To that point we had very little legal protection (and few legal resources) against the occasional angry and vindictive advisor; we're threatened occasionally and while truth and justice are defenses, they're not safeguards against bankruptcy. And we had no organizational foundation on which to build. It wast mostly me, guessing and hoping.
After talking with managers we respect and a local attorney, we decided to become an LLC. Shortly thereafter, we filed for and received intellectual property protection for our logo and name. Then a hang-up: I went to a non-profit law specialist to begin filing for the 501(c)(3) status and she informed me that LLCs cannot become tax-exempt. So then we filed to dissolve the LLC, incorporate in Iowa as a non-profit and file for 501(c)(3). She warned me that the IRS could take more than a year to adjudicate. Happily, it was closer to six weeks. Next, we need to hire an accountant who specializes in non-profits to work through the question of how we move resources from MFO's account into MFO, Inc's account. The existing account (and its attendant taxes) is legally mine because MFO was a sole proprietorship. Chip has an MBA and believes that I might be able to loan the money to MFO as start-up capital or make it a contribution. But once it's in the new MFO, it becomes a bit legally constrained.
What's next? Ohhh ... we need to recruit one to three additional members to MFO's board of directors. Chip and I sit on the board, but we need folks with broader expertise and a better understanding of the financial services and/or non-profit organization words. We've had several nominees who feel, uhh, distinctly higher on the food chain than me. Those discussions are commencing. We need to decide what, if anything, might be offered to MFO contributors. My bottom line is that nothing we do now gets taken away from folks, it remains free and non-commercial. But we might offer access to Charles's fund screener or some other editorial service. The data contracts, though, are really expensive by our standards, even after considerable negotiation. So I want to be sure we're acting sensibly before mortgaging anything.
And, oh yeah, I start back to full-time teaching and administering my academic department soon; we're searching for two new faculty and I've been asked by my president to help develop a plan to recruit and support transfer students to the college. Had I mentioned trying to finish the September issue several days early so I can drive to Cincinnati and meet the folks at the Ultimus Fund Services client conference (I'm trying to do networking for us)?
For what interest all that holds,
David

The total stock market funds are generally tax efficient.ETFs are often tax efficient Vanguard has tax managed funds. I like Tax manged capital appreciation . Owned it 20 years with NO capital gain distributions It invests in roughly the largest 10000 growth stocks (so no Exxon for example

Well Maurice, I am one of those posters. I don't feel a need to do weekly posts to promote holding AU. Nor do I ponder/fret what to do about it day-to-day. So you needn't fret about why you haven't seen such posts...
I continue to hold my position in AU bullion (all of which I self-custody). And it makes a wonderful diversifier. --- A diversifier does not mean "go up all the time". AU had a VERY LONG up-market; several down-years is nothing too unusual. -- After all, equities, after topping in 2000, took a decade to reach new highs. Assets come/go out of favor. AU excelled when stocks did nothing. AU has foundered the past few years as stocks have climbed. Definitionally,that IS diversification. Breaks in the price of AU below $1K would commence my accumulating. (If I had NO AU position, I'd probably commence SLOW accumulation here --- as the GDX/GDXJ suggests possible capitulation in those securities).
I do find from time-to-time, what I will call "gold haters" post on investment message boards, why, I do not know. Energy stocks are down sharply since Nov. EM-stocks too. Is it your contention that asset are only attractive for purchase/holding if they are at/near all-time highs..? --- I generally go about deploying capital the other way: buy/accumulate when prices are down. Maybe different strokes for different folks...?
In the past month I have initiated and expanded new positions in MLPs and EM, as those have encountered price weakness, but IMO represent real longer-term value. Will probably commence accumulating shares in Aug-Nov in quality energy producers -- my thesis being the quality producers (XOM, CVX, COP, OXY, EOG) will recover -- primarily because I suspect circumstances will eventually drive WTI higher. I don't claim to know when, but $45/WTI is not conducive to producers -- so producers will (voluntarily or otherwise) curtail production, and that will "solve" the problem of low WTI (just as happened in earlier cycles).

Went from 70% equities (MFs, ETFs, and individual stocks) down to 55% equities at today's market open with remainder of portfolio in cash, i.e., no bond holdings. Market breadth is lousy, good earnings reports are not being rewarded sufficiently and stocks with earnings misses are tanking. More importantly, most of my individual stock holdings have either traded sideways or declined slightly in value since April with few stocks gaining more than 10% over the past 4 months.
Something doesn't feel right and August/September are usually weak months. I have sold all individual stocks that have high(er) betas than the S&P 500 and locked in gains in my few winners.

Market breath peaked in April 1998 before the major decline began in March 2000. And back then it was just a handful of tech stocks that accounted for the big gains in late 98 to the final top. Not sure when breath peaked this time around. The next large decline could be led by the biotechs even if there is no similarity between them in this cycle vs tech stocks in the late 90s cycle. Anyone looked at the chart of Biogen (BIIB) lately?

Poor quarter/guidance. AMGN, GILD and CELG all had good/very good quarters. Considerable discussion that AGN may bid for BIIB, ABBV or AMGN.

Market breath peaked in April 1998 before the major decline began in March 2000. And back then it was just a handful of tech stocks that accounted for the big gains in late 98 to the final top. Not sure when breath peaked this time around. The next large decline could be led by the biotechs even if there is no similarity between them in this cycle vs tech stocks in the late 90s cycle. Anyone looked at the chart of Biogen (BIIB) lately?

http://www.wsj.com/articles/the-only-six-stocks-that-matter-1437942926
All the gains in the S+P 500 could be associated with 6 stocks

Bob mentions "world-allocated portfolio" in his above post ... Curious, I located a definition:
"World-allocation portfolios seek to provide both capital appreciation and income by investing in three major areas: stocks, bonds, and cash. While these portfolios do explore the whole world, most of them focus on the U.S., Canada, Japan, and the larger markets in Europe. It is rare for such portfolios to invest more than 10% of their assets in emerging markets. These portfolios typically have at least 10% of assets in bonds, less than 70% of assets in stocks, and at least 40% of assets in non-U.S. stocks or bonds." http://money.usnews.com/funds/mutual-funds/rankings/world-allocation
RPGAX (which I own) seems to conform pretty closely to that definition. it's up 3.36% YTD. That would put it in the 5-6% bracket for a full year - if the trend continues.
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Yikes. Hadn't realized EM's were bleeding so badly. Thanks Bob for the insights.

Obviously not surprising now, but I would be surprised if they haven't raised by December.

I'm still thinking it winds up being next year, if that. Inflation is not where they want it, China is not in good shape and other cracks showing.
UPS earnings call:
CEO Abney: “But to get to the economy, recent economic news has just been mixed and it’s caused us to be cautious. The continued strength of the U.S. dollar and I think this impending rate hike by the Fed appears to be holding back some U.S. growth.”
Chief Financial Officer Richard Peretz: “The U.S. domestic business is on track with its revenue management and efficiency gains. However, we are seeing some softening in the economy.
Chief Commercial Officer Alan Gershenhorn: “We’re about where we thought we would be. [But] we think the economy was certainly slower for sure.”
http://www.marketwatch.com/story/ups-fires-warning-shot-across-the-bow-of-the-stock-market-and-the-fed-2015-07-28
---
Now, I'm not saying that things are falling apart or going to. But I am increasing positions in things like Ecolab (ECL), which is now a very large holding and continues to be a favorite example of "buy and forget".
I do not think that Yellen has forever to raise rates - I think there is a point the window to raise rates will have closed. Some think the window has already closed.

Now GILD's price targets are predictably being raised:
S&P CAPITAL IQ REITERATES
STRONG BUY OPINION ON
SHARES OF GILEAD SCIENCES
Recent Price: $113.07
Recommendation:
FIVE STAR BUY [Highest Rating]
We raise our 12-month target $12 to $155 on below peers 13.9X our revised 2015 EPS estimate of
$11.15, up $0.95. Q2 EPS of $3.15 vs. $2.36 is $0.65 ahead of our est. Sales, driven by a robust $4.9B
in Sovaldi/Harvoni hepatitis C (HCV) sales, rose 26%. We see GILD maintaining dominant 90%+
HCV market share in the U.S., but we see new HCV patients moderating in H2 from significant
uptake in Q1 and some payer restrictions. We see solid growth in Europe, including France where
price negotiations just finished and we see large Japan opportunity, which approved Harvoni in
July.
Jeffrey Loo, CFA
07/28/2015 17:56:55

My apologies for having momentarily hijacked this thread. I find this summary about GILD to be right on:
"What we're seeing come through is an under appreciation of all the hepatitis C revenues available outside the U.S.," said RBC Capital Markets analyst Michael Yee. "The company raised revenue and lowered expense guidance. You can't ask for better than that."

I'm watching Gilead... maybe at 105?

Gilead Sciences earnings: $3.15 a share, vs $2.71 a share expected
http://www.cnbc.com/2015/07/28/gilead-sciences-earnings-.html
Reports Q2 (Jun) earnings of $3.15 per share, $0.44 better than the Capital IQ Consensus Estimate of $2.71; revenues rose 25.8% year/year to $8.22 bln vs the $7.59 bln consensus. Also raises guidance for FY15 product sales.

Did you answer this? I missed it.
>> I am in no mood for ... even a 1.5% or 2% decline.
So how do you equity-invest at all if you do not ever want to see a 1.5% decline ?

That's a 1.5% to 2% decline in my total account balance. So I keep no more than 5% to 10% of overall capital in equities. I am primarily a bond fund trader and there you can control your drawdown much more than individual equities.

Nice going Junkster ... and, thanks for sharing your thoughts.
I can see where Junkster is up 4.4% as claimed because he has booked profit from most of the positions he opened. One of the things that has helped me better my boggy, the Lipper Balaned Index, has been my special investment position (SPIFF) that I opened this past fall and held through late spring with its gains now booked has provided enough profit to push me ahead of it.
A few good spiffs, from time-to-time, can make your returns real healthy.

I am up 4.42% YTD and on track for my worst year since 2008. Not sure that is isolated to me or others are also struggling. I take no solace in the fact my return is higher than many of the market indexes as my goal is to consistently compound my capital and not to shadow or beat any particular market index. I haven't a clue how the rest of the year will unfold. I think China is simply an excuse for an already overall sick market. But as we have seen, at least since 2008, rallies seem to come when the markets have looked the sickest. At my age and financial situation I am in no mood for any drawdown in my total nest egg - even a 1.5% or 2% decline. Then again I was never in the mood for any drawdown, young or old. So all I hold (for the moment) are three very small equity positions in small cap biotech and a bank loan fund. Junk corporates have performed especially poorly lately in part because of the decline in oil prices. On the other hand, junk munis are suddenly looking inviting again.

Congratulations ! You are doing very well given the current environment. I'm up about 1.5% YTD and that's a fairly conservative portfolio. For junk munis, I do own PRFHX. I also hold ZEOIX which is holding up nicely. My other bond funds are a mixed bag with most hovering around the flatline for YTD.

My plan as always is to take what the market gives and can ramp up quickly if necessary. It hasn't been very giving lately so hence the cash. Yes, I know conventional wisdom says you can't time the market and I couldn't agree more. But I look at timing as an attempt to pick tops and bottoms - virtually impossible especially tops - and money management as two entirely different mindsets. To me money management is not sitting in losing positions and watching my capital erode.

I am up 4.42% YTD and on track for my worst year since 2008. Not sure that is isolated to me or others are also struggling. I take no solace in the fact my return is higher than many of the market indexes as my goal is to consistently compound my capital and not to shadow or beat any particular market index. I haven't a clue how the rest of the year will unfold. I think China is simply an excuse for an already overall sick market. But as we have seen, at least since 2008, rallies seem to come when the markets have looked the sickest. At my age and financial situation I am in no mood for any drawdown in my total nest egg - even a 1.5% or 2% decline. Then again I was never in the mood for any drawdown, young or old. So all I hold (for the moment) are three very small equity positions in small cap biotech and a bank loan fund. Junk corporates have performed especially poorly lately in part because of the decline in oil prices. On the other hand, junk munis are suddenly looking inviting again.

MikeM, Cinammond sure hasn't been doing a very good job of preserving capital, even with all that cash. I know it hasn't been a downturn, but his fund is still down 4.97% YTD.

Yes, Scott is right. Eric Cinnamond's name has become synonymous with "value trap" manager. And he has been invested this way for years now. MFO has endorsed many good funds, but the endorsement on this manager turned out to be a loser over the last 4 1/2 years.
Hate to beat a dead horse, but this guy has been barking up the wrong tree with his investments. He has been over-weight in PM miners for years now. His inability to adapt or see that the market doesn't agree with his analysis is kind of Hussman-esq. Might he preserve capital in a down turn with all that cash? Sure, but how long do you give a manager to prove himself right? Personally, I got out of ARIVX a couple years ago because he was so over weight in mining stocks. Two years later, he still is.