My current allocation (for contributions) is:
40% SSgA S&P500 Index fund | 0.01%
30% SSgA Russell Small/Mid Cap Index Fund | 0.02% (tracks Russell Small Cap Completeness Index)
30% SSgA Global All Cap Eq. ex-US Index Fund | 0.05% (tracks MSCI ACWI ex-USA IMI Index)
My options for bond/fixed income are:
SSgA Bond Index Fund | 0.03% (Tracks Barclays Capital US Aggregate Bond Index)
PIMCO Inflation Response Multi-Asset Instl (PIRMX) | 1.04% gross
Core Plus Fixed Income | 0.32%
The last one ("Core Plus") is described as follows: “The Fund seeks to provide income and capital appreciation. The Fund invests primarily in domestic, investment grade, corporate, mortgage-backed and asset-backed bonds. The fund also invests in below investment grade bonds and bonds of international and emerging market countries.” Its turnover is 0.30% and its asset classification is Intermediate-Term Bond.
And it’s allocations:
77.28% US Bond
40.12% Non-US Bond
The Barclays Index would be my natural choice given its low expense ratio and well-known index, but the other two look interesting. The PIMCO one holds a bunch of REITs, so I’d assume that counts as more of an equity than fixed income. However I have heard good things about PIMCO and their bond fund experience. I’m not very clear on what “Core Plus” is (the negative -21.07 cash has me scratching my head). It doesn’t have a ticker and SSgA (State Street Global Advisors) doesn’t list it on their website.
Any advice or insight is appreciated.
A. SSgA Bond Index Fund | 0.03% (Tracks Barclays Capital US Aggregate Bond Index). This is the same index tracked by Vanguard's Total Bond Market Index Fund, and many other broad based bond funds, at a much lower expense ratio. http://en.wikipedia.org/wiki/Barclays_C ... Bond_Index .
As to the PIMCO fund, this sounds extra risky to me "[t]he fund also invests in below investment grade bonds and bonds of international and emerging market countries."
I'm just not very familiar with the holdings of the bottom two funds. I guess if I don't understand it, I should stay away. After considering the expense ratio, the extra return will probably be significant over time, at lower risk.
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