What is the tax managed form of a fund worth?

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Random Walker
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What is the tax managed form of a fund worth?

Postby Random Walker » Sun Dec 30, 2012 6:48 pm

Small and value asset classes are considered relatively tax inefficient. Does anyone have a rough number in their head as to what additional return a TM small or TM value fund might yield compared to the non tax managed fund for the taxable investor?


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Re: What is the tax managed form of a fund worth?

Postby grabiner » Sun Dec 30, 2012 8:42 pm

Here's the comparison for Vanguard's tax-managed funds:


With the development of ETFs, small-cap and value index funds can avoid most capital gains. Tax management can reduce dividend yields (TM Capital Appreciation) or have 100% qualified dividends (TM Small-Cap and TM International; none of Vanguard's other small-cap or international funds have 100%), so it still gives a small benefit. (The benefit from 100% qualified dividends might expire.)
David Grabiner

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