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Funny that you would mention both DODIX and LSBRX. I used to own DODIX through my online broker and there was a fee to buy and sell that fund. I just checked my spreadsheet and I paid $35 to buy it, and I think around $50 to sell it. Ouch.
Quote:
Originally Posted by mysticaltyger
Your broker is ripping you off for charging you to buy and sell those funds. You can go to Doge & Cox and buy from them directly for no fee.
In general, if you buy a no-load fund directly from the fund family, there will be no fee. If you buy it from a broker, there will typically be a fee UNLESS it's on their No Transaction Fee (NTF) list of funds.
American Century has switched most of their funds from NTF to front load in order to make it easier for the consumer to understand (ha ha, yeah right, so they can charge fees). There has also been a dramatic exodus and outflow in this fund in the last couple years. With the yield and poor performance in the last five years, -9.31%, I think you should switch out to a different growth fund.
American Century has switched most of their funds from NTF to front load in order to make it easier for the consumer to understand (ha ha, yeah right, so they can charge fees). There has also been a dramatic exodus and outflow in this fund in the last couple years. With the yield and poor performance in the last five years, -9.31%, I think you should switch out to a different growth fund.
Like I said: Just say NO to mutual funds. I have my own portfolio and it is doing quite well. I just added stocks for companies #28 and #29 so I am getting close to a focused fund, which typically holds 30-50 different company shares. I do pay a front-end load of $12.95 per trade (Charles Schwab), but after that there is NO fee. No management fee; no 12b fee; no "You don't have enough money under our management" fee, and so on. If I choose NEVER to sell (give the shares to my children for their inheritance), then there is no selling fee either.
I can choose when to buy and when (if ever) to sell. I am not bound to the herd which goes in the wrong direction: they sell in a panic sending prices down, forcing mutual funds to sell also; they buy in euphoria sending prices up, forcing mutual funds to buy also.
The index that I compare my performance with is the growing stream of dividends that I get paid quarter after quarter. This stream has been growing over 40% year-on-year, mostly because I keep buying more shares. Prices depressed? Good, I buy in at cheaper prices. Prices too high? I can hold and wait for the herd to turn and run the other way.
When you "invest" with mutual funds, you ARE the herd. The manager makes the decisions and he or she doesn't want to be different from the others, thus, the herd mentality. As they say, it is better to be wrong with the others than to risk being right (or wrong) by yourself.
In general, if you buy a no-load fund directly from the fund family, there will be no fee. If you buy it from a broker, there will typically be a fee UNLESS it's on their No Transaction Fee (NTF) list of funds.
In general, if you buy a no-load fund directly from the fund family, there will be no fee. If you buy it from a broker, there will typically be a fee UNLESS it's on their No Transaction Fee (NTF) list of funds.
Right. I personally refuse to pay a fee to buy or sell a fund.
Sounds good in theory, Teak, but very few people can beat the market over time. Maybe you're the exception. But most of us aren't.
I doubt that I am "beating the market" and that is not my point of investing anyway. If market returns plot out on a normal distribution (bell-shaped curve) then by definition 50% will "beat" the market average in any given year and 50% will "lose" to the market average. Few will be able to beat the average consistently, year on year. What is the point of trying to beat the market? Who is keeping score? What tangible benefits do you get for beating the market?
I liken investing in stocks akin to what our friend forest beekeeper advocates in other threads. While he uses Multi-Family Residences to produce passive income, I use dividend-paying stocks.
We both put our money into productive assets that will pay out passive income; his monthly, mine quarterly. In fact, if he is managing his assets himself (snow removal, utility repairs, etc.), then his passive income is less passive! My assets, however, reflect that I am a part owner of companies that are continually producing goods and services, and paying me as a shareholder. We both have risks: he has to insure that his units stay close to 100% occupancy; my risks involve avoiding, or ditching, companies that implode and do not give passive income.
The beat-the-market-game is something that I just do not understand from an investment standpoint. If your return one year is +100% and then -50% the next year, are you up +50% in net, or even? Percentages are such useful for deception.
(The answer, of course, is that you are even. But we are so tuned into simple numbers that without reflection someone might think they are up in net.)
Does this make sense? Business owners are the richest people in the world. Not gamblers; owners. And as a little guy, I can approach business ownership (while employed as a wage-earner) by becoming a part-owner of many companies that pay out regular distributions to their shareholders.
Probably my last post to this thread which seems to have lost its OP, who was asking about mutual funds anyway. Mutual funds are one way to go for passive income, but certainly not the best way.
Last edited by Teak; 07-29-2009 at 12:53 AM..
Reason: addition
It "may" be higher, but on average, load funds actually have higher ERs than load funds.
Quote:
Originally Posted by Teak
The beat-the-market-game is something that I just do not understand from an investment standpoint.
In my view, it matters because if you can't BEAT the market doing what you're doing, you might want to try something different or just JOIN the market. For example, if you buy actively-managed mutual funds that underperform the market most years, you might as well ditch 'em and go with index funds, ensuring that you'll at least get very close to the market's return. If you do all the work required to trade individual stocks and you still can't beat the market, you might want to save yourself the trouble and, again, buy index funds instead. Of course, performance isn't everything--there's also risk, etc., to take into consideration--but you get the point.
Quote:
Originally Posted by Teak
Like I said: Just say NO to mutual funds.
That's fine for some like yourself, but there are plenty of people who don't have the time, know-how or desire to mess with a bunch of individual stocks. For those people, funds (in one form or another) are the logical option. My personal view on actively-managed mutual funds is this: A small percentage of them are very good. If you know how to dig those up, they may pay off for you. Otherwise, your best bet is to play the averages and go with index funds or ETFs.
I appear to have had a misconception about PTTDX, PIMCO Total Return. It is not just a government bond portfolio consisting of Treasuries, GSE bonds. At least, I'm pretty sure Total Return means something that requires more risk than government insured.
Investment Stylehttp://www.pimco.com/PIMCO_US.Site/Images/spacer.gif (broken link)Total Return is a core bond portfolio strategy that seeks maximum current income and price appreciation consistent with the preservation of capital and prudent risk taking. All sectors (http://www.pimco.com/LeftNav/BondResources/Glossary/S.htm - broken link)of the bond markets are utilized in an effort to add value while maintaining an overall risk level similar to the benchmark.
“There is no investment potion for this new environment other than steady income-producing bond and equity investments in companies with strong balance sheets and high dividend yields,” Gross wrote.
On Scottrade, I just found a ATT bond original coupon of 6.5 selling for 5.903. People have enough trust in ATT to bring the yield down. For a solid company to award 6.5 is a sweet deal.
So I guess that is what Pimco Total Return is all about. Good companies, good bonds, undervalued assets. And they have done well.
The YTD chart is beautiful, even with roaring equities. It has rebounded nicely from the September crash as well.
Mutual funds are my choice for investing. But, only after the 6-9 mo. emergency fund is in place.
You have to have a long term approach. But all funds are not equal and feeling confident with the mutual fund manager or management is important. There is enough research material out there that the face to face meeting is not really necessary. Many mutual fund managers have given interviews, written books or have had articles written about them. The long term performance of the fund will tell the tale.
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