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Interesting. No broad S&P 500 coverage? Is that because you think it's overvalued right now or do you just prefer growth stocks? And 20% international stock is interesting too. Thanks for the input!
The Dividend Growth fund isn't really a true "growth" fund. It focuses on companies that can pay and grow dividends over time. It's a blend between a "growth" and a "value" fund, but I'd say it's more value leaning.
I do think the S&P is a bit overvalued. But I like Vanguard Dividend Growth for the long haul. When the stock market is down, this fund usually holds up better. One thing we know about investor behavior is they tend to stick with funds that are less volatile and they can't handle the more volatile funds (even though they think they can). And despite being less volatile than the S&P, Dividend Growth has better returns, too.
I think a certain international allocation is a good thing for diversification. And Dodge & Cox is a top notch firm. They are pretty much the cheapest investing shop after Vanguard. Expect Dodge & Cox International Stock to have some rough years that are out of step with the international stock markets as a whole...but over the long haul it has outperformed other international stock funds and I expect that will continue, partly because of its low expense ratio of .64% and partly because of it's solid, long tenured management team. Make no mistake, international stock funds are typically more volatile and this fund is as volatile as other funds in the category....but I think it's worth it.
Are you looking at before or after fees? And is the S&P it's benchmark or something else? The S&P isn't the benchmark for every fund. And some funds take more risk or less to get their returns. Anyone can take on more or less risk. No need to pay expensive managers to do that.
Sorry but this fund is a total dud.
10 year R-squared (against Standard Index) = 97.55
5 year R-squared (against Standard Index) = 98.08
That means they are simple copying their comparable index for an extra 0.58% per year. Anything in the 90's is a waste of money. This one's a no brainer. Would you pay an extra 0.58% for an index fund? Of course not.
after fees ,of course. compare it to spy.
meijx 10 year 9.03 vs spy 7.94 and 15 year 7.94 vs 4.93 spy.
in fact one of the best funds i owned is fidelity growth company and it even beat that fund in the 15 year. it failed to beat it at any other time frame though.
fidelity growth company certainly was well worth every penny in fees.
i am not saying it is a bad choice or a good choie but had you been in it the last 10 or 15 years you would have done better even with the fees.
Last edited by mathjak107; 02-21-2015 at 02:14 AM..
Are you looking at before or after fees? And is the S&P it's benchmark or something else? The S&P isn't the benchmark for every fund. And some funds take more risk or less to get their returns. Anyone can take on more or less risk. No need to pay expensive managers to do that.
Sorry but this fund is a total dud.
10 year R-squared (against Standard Index) = 97.55
5 year R-squared (against Standard Index) = 98.08
That means they are simple copying their comparable index for an extra 0.58% per year. Anything in the 90's is a waste of money. This one's a no brainer. Would you pay an extra 0.58% for an index fund? Of course not.
I like Vanguard Dividend Growth better, but I don't think MEIJX is such a terrible fund. The stock market has been on fire the last 5 years, and value funds like this one tend to trail the market when it's going gangbusters, so I don't it's weak relative returns over the last 5 years are a big deal. I would like the fund better if the OP had the cheaper "R5" share class because the ER is only .53%.
Not the world's best fund, but I think it has a reasonable chance of outperforming the S&P. Call me crazy, but I think paying a modest premium to try to beat the S&P is worth it. If the OP didn't have Vanguard Dividend Growth in his plan, I would recommend going with this fund over the S&P.
I like Vanguard Dividend Growth better, but I don't think MEIJX is such a terrible fund. The stock market has been on fire the last 5 years, and value funds like this one tend to trail the market when it's going gangbusters, so I don't it's weak relative returns over the last 5 years are a big deal. I would like the fund better if the OP had the cheaper "R5" share class because the ER is only .53%.
Not the world's best fund, but I think it has a reasonable chance of outperforming the S&P. Call me crazy, but I think paying a modest premium to try to beat the S&P is worth it. If the OP didn't have Vanguard Dividend Growth in his plan, I would recommend going with this fund over the S&P.
it really is impossible to compare human results to posted stats anyway. especially when dollar cost averaging in or adding money. no one gets those posted results so at best they are just in the lab comparisons only. which like gas mileage vary in the real world greatly.
it really is impossible to compare human results to posted stats anyway. especially when dollar cost averaging in or adding money. no one gets those posted results so at best they are just in the lab comparisons only. which like gas mileage vary in the real world greatly.
Yes, agreed. But I think the data are pretty clear that the more volatile the fund, the bigger the gap between published performance and investor performance.
i am not even sure that once you go beyond a certain point in beta that it gets better being lower.
you would think a balanced fund had investors stay put better but i see for fidelity balanced fund a 10 year fund return of 7.47% while investors as a group saw 4.83%.
for 15 years the fund averaged 7.41 while investors only saw 5.35
on the other hand a volatile fund like fidelity growth co saw the 10 year fund return at 11.38 and investors saw 9.11% , on the 15 year the fund saw 4.70% and investors 2.44%
not as much difference as i would have thought.
Last edited by mathjak107; 02-22-2015 at 02:07 AM..
i am not even sure that once you go beyond a certain point in beta that it gets better being lower.
you would think a balanced fund had investors stay put better but i see for fidelity balanced fund a 10 year fund return of 7.47% while investors as a group saw 4.83%.
for 15 years the fund averaged 7.41 while investors only saw 5.35
on the other hand a volatile fund like fidelity growth co saw the 10 year fund return at 11.38 and investors saw 9.11% , on the 15 year the fund saw 4.70% and investors 2.44%
not as much difference as i would have thought.
Yeah, I see your point. But Fidelity Balanced is more volatile than average for the category.
The 10 Year Investor Return for Vanguard Wellington is 6.85%. For Mairs & Power Balanced, it's 7.80% (and the fund's return is actually lower at 7.59%). For Oakmark Equity & Income, it's 7.21%.
Another fund that blew up in 2008 like Fidelity Balanced was Dodge & Cox Balanced. The 10 year return for that fund was only 3.90%. So I think the key here is the funds that did worse than average for the category in 2008 have bad 10 year investor returns, even if the funds themselves still had above average returns over that time period.
i think if anything we can assume that the beta of the fund has little to do with investor actions and in a fire folks are going to run for the exits no matter what.
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