Index Funds - 5-year comparison tools

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smartypants
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Index Funds - 5-year comparison tools

Post by smartypants » Wed Jun 23, 2010 10:03 am

I just finished reading The Little Book of Common Sense Investing and I was quite impressed by index funds. In the book John Bogle showed how his S&P 500 index fund outperformed all but 3 index funds over the last 30 years.

I was actually curious to do a similar comparison but I just needed to know of a tool that could do something like the following:

Show which funds beat fund X (such as the Vanguard Total Stock Market Index Fund) during years A through B.

I'm planning on running the comparisons for a few Vanguard funds vs everyone else for years like 91-96, 92-97, 93-98, in 5-year increments up to the present time.

I really, really like indexing and I'm convinced that its the best way to go about investing in general, but I wanted to see how the index fund compared in the short run--even though indexing as a strategy is for the long haul--10 years+.

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stratton
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Post by stratton » Wed Jun 23, 2010 11:13 am

Morningstar has this for each fund. Got to the page for a fund and then go into the chart page for that fund. Play around with the chart. You can move the end points of the chart by dragging them.

Paul

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Doc
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Post by Doc » Wed Jun 23, 2010 12:19 pm

stratton wrote:Morningstar has this for each fund. Got to the page for a fund and then go into the chart page for that fund. Play around with the chart. You can move the end points of the chart by dragging them.

Paul
Image

http://quote.morningstar.com/fund/chart ... %2C0%22%7D
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.

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smartypants
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Post by smartypants » Wed Jun 23, 2010 12:47 pm

Excellent! That is extremely helpful. I see that Morningstar allows you to compare a particular fund to another, but does it allow you to compare a fund to all of the other ones?

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Ted Valentine
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Post by Ted Valentine » Wed Jun 23, 2010 1:10 pm

Not trying to discourage you, but to possibly save you some time.

Past performance is not relevant. Trying to build your investments based on something that cannot be repeated is nonsense.

The lesson in that book is not what fund had the best performance by why.
Although our intellect always longs for clarity and certainty, our nature often finds uncertainty fascinating.

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smartypants
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Post by smartypants » Wed Jun 23, 2010 1:18 pm

@Ted,

I completely agree with you, past performance is completely irrelevant and it has been proven that actively managed funds cannot with consistency repeat their performance.

The reasoning behind things was a bit more academic. My theory is that by being average and representing the market, index funds actually outperform 90-95% of the market consistently even during short periods of time, rather than the 30-year comparison as listed in John Bogle's book.

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Doc
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Post by Doc » Wed Jun 23, 2010 2:00 pm

joliver wrote:Excellent! That is extremely helpful. I see that Morningstar allows you to compare a particular fund to another, but does it allow you to compare a fund to all of the other ones?
http://quote.morningstar.com/fund/chart ... %2C0%22%7D

It can get kind of messy if especially for rolling returns but you can always do a few at a time.
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.

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anthau
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Post by anthau » Wed Jun 23, 2010 7:13 pm

Smart Money's "Fund Map" may be of interest.
Best, | | Anth

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Taylor Larimore
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Indexing over short-term periods

Post by Taylor Larimore » Wed Jun 23, 2010 7:56 pm

Hi Joliver:

Standard and Poor's has already done much of the research you are considering:

Standard & Poor’s Indices Versus Active Funds
(SPIVA) Scorecard, Year-End 2009
"Simplicity is the master key to financial success." -- Jack Bogle

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