Go to Jeff Salisbury LWGate Home Page.From: Randy Barnes <rbarnes@mindspring.com>
Subject: Re: Asset Allocation , part 2
Date: Wed, 05 Aug 1998 23:00:53 -0400
Next Article (by Author): Re: capital gains tax Rich Carreiro
Previous Article (by Author): High income, low risk? :-) "Melinda Johannes"
Articles sorted by: [Date]
[Author]
[Subject]
>Really? If I had to choose, I would choose Vanguard Windsor II for the
>longer haul. It has the same beta as Janus and charges less in internal
>transaction fees. If I had my choice, I would own both Windsor II which
>is a more value-oriented stock fund and Janus, which is a more
>growth-oriented fund.
Performance: Trailing Return % (SOURCE: Morningstar)
3 Yr 5 Yr
1 Mo 3 Mo 1 Yr Avg Avg
........................................................................
S&P 500 Index 4.06 3.30 30.15 30.22 23.06
Janus 6.01 6.12 31.99 25.60 19.23
Vanguard/Windsor II 1.33 1.80 30.43 30.18 22.29
Vanguard/Windsor -0.79 -2.24 17.01 22.35 19.03
~~~~~~~~~~~
Primo,
Three cheers for your opinion and input. Serious discussion of
investment topics has been pretty lame around here for a good while. I
applaud your effort and think you could be right.
I took a second look at the reasons I'd picked Janus in the first place
and rediscovered another reason I'm no fan of mutual funds. Fund data is
available in a million places but it is very inconsistent and VERY easy
to manipulate.
I too went to Morningstar to get a peek at performance figures etc. This
is where I found the data that led to my previous post. The funny thing
is that the figures I find aren't the same as those you quote. Sometimes
different services report different figures and sometimes the same
service reports different figures for the same thing. Go figure;-)
At the following links you'll see Janus beating the S&P in the 10 year
time frame buy better that 1%. THe WinsorII lags the index, as does just
about every mutual fund in the universe. I give Janus the nod, with a
1.68% advantage (at least using this particular quote).
Janus -
http://www.morningstar.net/FundQT/RR_Performance/JANSX.msfhtml
Winsor -
http://www.morningstar.net/FundQT/RR_Performance/VWNFX.msfhtml
A small account of $200 per month for 10 years gains $7,600 more using
the Janus 10 year figure. (Ignoring taxes completely!)
[pv=-200,pmt=-200,n=12,r=.x/12] - Careful. The next 10 years results
will be different.
Now, this brings to mind another question. Are the S&P returns inclusive
of dividends, or not? THis is quoted both ways depending on who is
reporting. Before you know it you've written a thesis on which mutual
fund manager beat the market, or at least came close.
SPYders,(or index funds if you have a very small account), will
outperform almost every mutual fund over the long haul. SPYders are far
less trouble to own, and will serve you better for the future, with much
less energy. Save money by not buying crap like magazines with "10 HOT
Funds to Buy NOW!!" on the cover. Instead, buy yourself a self-help
book, put an extra few bucks in your account, buy a kid something
foolish, take a class, you get the picture. Use the savings to not pay
your accountant to figure out the mutual fund statements you will no
longer get each year. Even more valuable than the money is the time. If
your time isn't worth $20-100 an hour then get busy and figure out what
you need to learn to make something of yourself.
For SPY info see - http://www.amex.com or
http://www.fool.com/funds/funds5.htm
One more tidbit. The S&P is always got a wonderful blend of growth and
value stocks. No muss, no fuss.
FYI, I DO own positions in 2 funds, but only in a 401k, and there I have
no tax issues (for now) and I don't have much to choose from. We don't
even have an index fund in the mix .(Not my decision!)
I am not really trying to flame mutual funds. (lie) It's just that
anyone with a little common sense and intelligence soon sees the fact
that funds are too often laggards. Smart money just buys the market and
leaves it alone.
(still my favorite link, see:
http://www.pathfinder.com/fortune/investor/1998/980706/dfa.html
If you're like me and must spend hours knee-deep in invest-o-mania, then
stick to owning stocks, not funds. Statistics have shown that owning
just 16 stocks eliminates 93% of market risk, so the diversification
issue that this started with is sorta meaningless. The average person
really can beat the market, but not in a fund.
God bless you for sharing an opinion that is more insightful and
valuable than how to save 8 bucks on a credit report!
- -Randy
- -
Next Article (by Author): Re: capital gains tax Rich Carreiro
Previous Article (by Author): High income, low risk? :-) "Melinda Johannes"
Articles sorted by: [Date]
[Author]
[Subject]