Food for thoughts;
Coy:Your posting was on Vanguard Balance Funds. I am not an expert on balance funds, but the word average means the midpoint of says 100 similar asset funds which could run from the winner with the greatest return and the loser with the smallest return. An Index should be at the mid-point. But the statisticians says that over time only 20% of active fund will outperform their passive benchmark(the Index). So when Vanguard states that eight out of fourteen beat the average balanced fund what is the real meaning? Eight of the the funds shouldn't be held. Of the remaining eight the one to hold will be among the upper 20%. In my opinion the one to hold is VWELX. (The only Vanguard balanced fund in the upper 10% of its class rating.)
Lucas. You are correct, its VWELX.
Norberz: I did some Morningstar research the other day on Vanguard active fund performance. The winner for 1 year, 3 year, 5 years and 10 years is VGMPX with an 1, 2, 1, 1. for its past performance in it class. Vanguard best active fund, risky, volatile , but maybe worth holding in small amount. Other in the upper 10% of their class are VCVSX and VWELX. Funds in the upper 10 to 20% are VDIGX, VPMCX, and VTRIX.Those with 20 to 30% are NAESX, VHEHG, VMGRX, VHCOX and VWIGX. If the Vanguard active funds are performing above the upper 20% of their class the odds of beating indexing is zero. Why hold them. I did not gather the data on the bonds funds, but generally their performance is better than Vanguard mutual active funds.
Taylor: You say the best mutual fund are seldom in the "top 10" That sure is correct. I like a few of the top funds in my portfolio to get a slight boast in return. I hold:
Performance rating in their class
Fund------------------1yr-------------3yr-------------5yr--------------10yr
CGMFX---------------1---------------1----------------1-----------------1
VGMRX---------------1---------------1----------------1-----------------5
EWZ--------------------1---------------1----------------1-----------------1
JAOSX----------------1---------------1----------------2-----------------3
VGPMX---------------1---------------1----------------2-----------------1
These have been in top of their class for ten years. How much longer?
Who knows? The YTD will be watch and action taken if drop is not up to its present performance. Out of 8000 mutual fund there are very few with this type of record. Managers of these funds are worth their salt and their legacy will end.
Murfield
