Of the three funds you mentioned, I'd be buying Windsor right now. If you need more safety, redirect future investments to cash instead. Going to PRPFX now is chasing performance. In fact, it does not do well during bull markets. See if PRPFX compels you to invest when the S&P is doing well. Same with STAR.

You gotta buy low and you gotta sell at a profit. For a safety cushion, you need to accumulate cash.
 

Amarsh,

PRPFX is the only fund of the 3 I've followed some. I too share your optimism for the fund though not everyone does. I see it still gets 5 stars from M* at least. Whenever I consider geopolitical tensions and other instabilities it doesn't seem to me that gold will play a very stagnant game going forward. It does have a timeless value. None of us can be 100% certain of course but in my opinion it seems like it would fit into a plan to help accomplish what you are expecting.

Bill.
 

I see it still gets 5 stars from M* at least.

The M* star rating is based on past returns from the trailing 3, 5, and 10 year periods.  That's not very useful for evaluating this fund, since gold has been on a tear for about 8 years.  The fund will be back to 1 star in a hurry if gold plummets.  

Best,
Oildog

"VGSTX appears to be a safe, cheap, strong performer which will preserve some of my money. "

Re:   A Int'l Index Fund that Lost -51% by end of 02'?  and safe?  I don't think so..

And assuming you Grad. and Get a Decent Paying Job with a #401k? Keep what $ you have now in a MMkt or a FFRHX..Pay Dwn/off college loans, get a decent car and then a Condo/Loft/ Twnhome/ House  My last one bought for $57k and in 16 yrs, sold for $300k and was paid for after 15 yrs..That's only about +425% and of course Tax Free, not tax deferred. thus a $300k Now = $1.575 Million in another 16 yrs  and  then upgrade to a $3 million place and in another 16 yrs = $15 Mil...

The Potential sure beats those Other Funds, now doesn't it?

But, of course, look at all the taxes you'll have to pay whe you sell that $15 M place and maybe the first $5 mi is Tax Free by then..Leaving $10 Mil is taxable? maybe Net $6 mil and thus have only about $11 mi?

Nah, On 2nd thought , not worth it..

You got Decades ahead, so why not Go for CGMFX, CGMRX, FAIRX,FLVCX..?

My IRA has these funds in them for yrs and doing a bang up job..and even YTD.

Of course, Past Performance may not reflect Future and they may do better..

Limoman:

Re:   A Int'l Index Fund that Lost -51% by end of 02'?  and safe?  I don't think so..

Original poster was *not* talking about VGTSX (Vangaurd total int'l index).
He said VGSTX, which is Vanguard STAR fund.
Please pay attention to detail when replying, otherwise your answers will confuse people.

 Big Steve

Agree 100% with Oildog...The chart of PRPFX might mislead some people.

Many people jump into some funds without understanding how the fund invests.  I don't own this fund, but I believe the asset allocation it uses is static, so it will always have an amount of gold on it, for instance, and as Oildog mentioned, if gold starts to underperform, well...Besides, why paying the management fee for such fixed allocation? If you are interested in having gold or silver there are cheaper options out there.

The best advice I can give you amarsh, is to create a plan before deciding on the funds to use...define an AA, and don't worry if you can't fill it all at once...time is on your side now. Start by adding to the segment that you think would give you more diversification to start (maybe the star fund if you like it, but understand that it is a fund of funds, and it contains a stake in Vanguard Windsor) and then fill the gaps one step at a time. If you go with the Star fund, maybe adding a small cap value fund could be a good idea to complement it and boost returns long term.

Also, please, always read the prospectus from start to finish before buying a fund...they are important since they contain the information needed to having some understanding in how the fund will treat your money, and heck, it is your money, so you better understand where you are putting it.

Just my opinion. Hope it helps.

JC 

Your advice about creating an asset allocation plan before buying mutual funds and to "always read the prospectus" are excelllent points. But it would seem--that without owning PRPFX and possibly not reading its prospectus --you wrote "The chart of PRPFX might mislead some people." The link below leads to a table of Permanent Portfolio's annual returns since inception in December 1982. You (and Oildog) appear to assume that all investors will hold PRPFX permanently, when possibly some may treat it as a repository of relative safety in a bear market stoked by deteriorating economic fundamentals and geopolitical concerns.

http://www.permanentportfoliofunds.com/pdfs/2007%20PPF%20Annual%20Returns.pdf

possibly some may treat it as a repository of relative safety in a bear market stoked by deteriorating economic fundamentals and geopolitical concerns.

Here are the number of posts on PRPFX on these boards for each year:

2000: 0
2001: 0
2002: 3
2003: 13
2004: 128
2005: 84
2006: 66
2007: 161
2008 (so far): 498

Note the absence of "repository"-seeking investors in 2000-2002, which was the best time to have been in this fund.  The number of posts simply goes up when the fund is doing well over a trailing short-term time period.  This is nothing more than performance-chasing at its worst. 

Best,
Oildog

closer:

Your advice about creating an asset allocation plan before buying mutual funds and to "always read the prospectus" are excelllent points. But it would seem--that without owning PRPFX and possibly not reading its prospectus --you wrote "The chart of PRPFX might mislead some people." The link below leads to a table of Permanent Portfolio's annual returns since inception in December 1982. You (and Oildog) appear to assume that all investors will hold PRPFX permanently, when possibly some may treat it as a repository of relative safety in a bear market stoked by deteriorating economic fundamentals and geopolitical concerns.

http://www.permanentportfoliofunds.com/pdfs/2007%20PPF%20Annual%20Returns.pdf

Hey Closer:

First, yes, I mentioned that I don't own the fund, hence my research hasn't been so detailed. However, you kind of missed my point, or maybe I didn't explained it correctly. My point was that people need to understand how the fund operate before buying it...so, if you do the research and find the fund to be great because you can treat it as a "repository" then great, it fits within your plan, although still think there are cheaper options to create a similar allocation. Now, as Oildog then replied, my comment and opinion goes towards those that are attracted by the fund by the recent performance (many don't even know that the allocation usually remains static), thinking this is just a great balanced fund that will tend to do ok in bull and bear markets...First understand why it has done ok recently (and poorly when it has), and if you are ok with it, then decide how you'll use it. That was the point I was trying to make, and why I continued the discussion with advice on AA and research.

Just my opinion.

JC 

"The number of posts simply goes up when the fund is doing well over a trailing short-term time period."

Like, say, the last 10 years?

"This is nothing more than performance-chasing at its worst."

No. Not everyone is performance chasing. It's quite reasonable to plug a small percentage of PRPFX into a portfolio as an insurance policy against a "black swan" type negative event. If the gentlemen in Washington launch a first strike against Iran, let me know how this fund performs vs. VFINX.

Of course, you could duplicate PRPFX at lower cost by buying GLD and SLV, a few treasury ETF's and some natural resource stocks. Continuously rolling over s/t Swiss bonds would be a little harder, but possible. Don't forget to rebalance. Or just pay  0.95% to Cuggino to do all the work. Cheaper than most PIMCO funds. Cheaper, even, than Hussman!

Amarsh, your plan sounds great. But instead of 60/40 into each fund, make it 85%VGSTX / 15% PRPFX. That will create a balanced mix of large cap, small cap, and international stocks, a mix of government, corporate, and international bonds, some cash, gold, silver, and natural resource stocks. Your overall expense ratio will be 0.41%, which is excellent. And it will all work out just fine. Good luck. 

Cheers,

Steve