Vanguard: HOW MUCH active management is right for you? :(

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Vanguard: HOW MUCH active management is right for you? :(

Post by nisiprius » Wed Jun 21, 2017 4:05 pm

Image

Let me be clear, this is nothing new, Vanguard has offered actively managed funds since it was founded and has been explicitly suggesting a mix of active and passive investments for a very long time--I'm thinking of the 2007 paper by Gus Sauter, discussed here, Sauter: The appropriate mix of index and active management, including a link that is now apparently broken.

But I can grumble.

Considering active investing? 4 variables may help you decide.

Me, I just go straight to their flow chart.

Image

But perhaps I can make it simpler. Personally, I can stop right here:

Image

Be kind of fun to press a Vanguard advisor on the question, "Can you identify outperforming managers?"
Last edited by nisiprius on Wed Jun 21, 2017 4:14 pm, edited 1 time in total.
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by nedsaid » Wed Jun 21, 2017 4:10 pm

I just had to laugh at the "Hell No" chart, simple and direct. Thanks for the chuckle.

Edit: I wonder if the thread will get locked. Not family friendly and all of that. ;O)
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by nisiprius » Wed Jun 21, 2017 4:13 pm

My bad but I don't have time to look at it carefully right now: there is a link to a paper,
Making the Implicit Explicit: A Framework for the Active-Passive Decision which I should read in detail. However, still think one sentence from the paper tells me everything I need to know:
Per our research, a lack of conviction in identifying active manager talent results in an all-indexing solution.
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by xjz » Wed Jun 21, 2017 4:28 pm

I feel like they missed out on the only reason I consider actively managed funds at all: lack of an accessible passive option.

The only active fund in my entire portfolio is VCADX (California Intermediate-Term Tax-Exempt). I have no trust in my ability to pick winning managers and all that, but if I'm in the market for tax-exempt muni bonds in California, where can I go?

It makes me wonder, when people talk about how much money is in active management vs. passive, how much of that active money wishes it could be passive if only the opportunity existed.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Thesaints » Wed Jun 21, 2017 4:32 pm

Yeah, I don't like Vanguard hunting for more profits by pushing active management that way.

They could have made a better, and more honest, case by saying that active management does decrease expected returns, but also increases their volatility and some results are unattainable by expected returns alone.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by packet » Wed Jun 21, 2017 4:36 pm

What's the difference between identifying a outperforming manager and identifying an advisor or consultant who can identify an outperforming manager?

derp.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by avalpert » Wed Jun 21, 2017 4:38 pm

packet wrote:What's the difference between identifying a outperforming manager and identifying an advisor or consultant who can identify an outperforming manager?
One skill would make you a good fund management company exec and the other would make you a good financial advisory firm exec

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by sport » Wed Jun 21, 2017 4:46 pm

I understand and agree with all the logic favoring index funds. However, what do we say about PRIMECAP fund? It's performance has been too good over the years to attribute it to "just good luck".

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by frankbrenowitz » Wed Jun 21, 2017 5:00 pm

And what will its performance be in the future? That cannot be ignored either.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Vanguard Fan 1367 » Wed Jun 21, 2017 5:03 pm

Before I became a Boglehead I appreciate one of those advisors who recommend 5 star funds recommending Windsor 2 many years ago. I would have been better off with one of Vanguard's index funds but still the returns on Windsor 2 were pretty good, especially compared to something like active management with 1 percent charge for assets under management plus another one percent fee on the mutual fund, and perhaps a 3 percent or 5 percent load to get into it.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by arcticpineapplecorp. » Wed Jun 21, 2017 5:05 pm

sport wrote:I understand and agree with all the logic favoring index funds. However, what do we say about PRIMECAP fund? It's performance has been too good over the years to attribute it to "just good luck".
But will that continue indefinitely? If not, and they underperform then there goes your alpha, right? People said the same thing (performance too good) about Magellan and look what happened there (reversion to the mean). Sure you can always blame it on a change in manager, but isn't that the point? How many people do you think really keep track of who the active managers are of the active funds they own? Would they know when those managers left? Would they know how to evaluate the replacement managers? Do you know who the managers of Primecap are? If not, read below. Still this is limited information at best. And you still don't know when one or another will retire, be replaced, and what will happen next.

One other point...I went to Primecap to look up the manager and I see a message, "Closed to new investors". So, that being the case, even if I wanted to partcipate in this phenomenal growth story (once I discovered the growth that occurred in the past)...I can't even join the club because it's closed. :oops:

Here's the C.V. of the managers of Primecap, but otherwise I don't know anything about them. They're terribly well credentialled and I'm sure smart as a whip, but otherwise I don't know if they'll continue to outperform.

PRIMECAP Management Company

Theo A. Kolokotrones, Chairman

Portfolio manager.
Advised the fund since 1984.
Worked in investment management since 1970.
B.A., University of Chicago.
M.B.A., Harvard Business School.

Joel P. Fried, President

Portfolio manager.
Advised the fund since 1993.
Worked in investment management since 1985.
B.S., University of California, Los Angeles.
M.B.A., Anderson Graduate School of Business, University of California, Los Angeles.

Alfred W. Mordecai, Executive Vice President

Portfolio manager.
Advised the fund since 1997.
Worked in investment management since 1997.
B.S.E., Duke University.
M.E.A., Virginia Polytechnic Institute and State University.
M.B.A., Harvard Business School.

M. Mohsin Ansari, Executive Vice President

Portfolio manager.
Advised the fund since 2007.
Worked in investment management since 2000.
B.A., Colgate University.
B.S., Washington University.
M.B.A., Harvard Business School.

James M. Marchetti, Senior Vice President

Portfolio manager.
Advised the fund since 2015.
Worked in investment management since 2005.
B.A., Massachusetts Institute of Technology.
M.B.A., MIT Sloan School of Management.
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by oldzey » Wed Jun 21, 2017 5:42 pm

nisiprius wrote:But perhaps I can make it simpler. Personally, I can stop right here:

Image
+1

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by avalpert » Wed Jun 21, 2017 5:49 pm

sport wrote:I understand and agree with all the logic favoring index funds. However, what do we say about PRIMECAP fund? It's performance has been too good over the years to attribute it to "just good luck".
In what way? Since Vanguard's Midcap Index fund started in June '98 it has outperformed Primecap with identical sharpe ratios. Now, that isn't the perfect comparison but it is close.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Kenkat » Wed Jun 21, 2017 8:25 pm

avalpert wrote:
sport wrote:I understand and agree with all the logic favoring index funds. However, what do we say about PRIMECAP fund? It's performance has been too good over the years to attribute it to "just good luck".
In what way? Since Vanguard's Midcap Index fund started in June '98 it has outperformed Primecap with identical sharpe ratios. Now, that isn't the perfect comparison but it is close.
Not sure about those numbers but over the past 15 years, annualized returns:

Primecap Admiral 11.39%
Mid-cap Index Admiral 9.99%

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Kenkat » Wed Jun 21, 2017 8:28 pm

Thesaints wrote:Yeah, I don't like Vanguard hunting for more profits by pushing active management that way.

They could have made a better, and more honest, case by saying that active management does decrease expected returns, but also increases their volatility and some results are unattainable by expected returns alone.
Actually, active management does not decrease expected returns. High costs decrease expected returns. This is a critical point that gets missed a lot; Vanguard's active funds are low cost and low turnover, so they are not bad choices. Now, if you believe that active management does not INCREASE expected returns (a not unreasonable position), then you might as well index.

Vanguard's active funds are neither the best thing since sliced bread nor are they horrible funds pushed by a profit hungry Vanguard. The differences are largely much ado about nothing in my opinion.
Last edited by Kenkat on Wed Jun 21, 2017 8:32 pm, edited 1 time in total.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Kenkat » Wed Jun 21, 2017 8:30 pm

Vanguard Fan 1367 wrote:Before I became a Boglehead I appreciate one of those advisors who recommend 5 star funds recommending Windsor 2 many years ago. I would have been better off with one of Vanguard's index funds but still the returns on Windsor 2 were pretty good, especially compared to something like active management with 1 percent charge for assets under management plus another one percent fee on the mutual fund, and perhaps a 3 percent or 5 percent load to get into it.
You were probably better off in Windsor II before 2004 as Vanguard's Value Index funds tracked terrible indexes with poor value exposure, high turnover and relatively poor performance. They switched indexes in 2004 and results have been much better. Windsor II has still mostly tracked the Russell 1000 Value Index.
Last edited by Kenkat on Wed Jun 21, 2017 8:34 pm, edited 1 time in total.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by avalpert » Wed Jun 21, 2017 8:33 pm

Kenkat wrote:
avalpert wrote:
sport wrote:I understand and agree with all the logic favoring index funds. However, what do we say about PRIMECAP fund? It's performance has been too good over the years to attribute it to "just good luck".
In what way? Since Vanguard's Midcap Index fund started in June '98 it has outperformed Primecap with identical sharpe ratios. Now, that isn't the perfect comparison but it is close.
Not sure about those numbers but over the past 15 years, annualized returns:

Primecap Admiral 11.39%
Mid-cap Index Admiral 9.99%
I looked at the original Primecap vs. the Mid-Cap investor shares for the longer timeline:

Primecap 9.46%
Mid-Cap Index 9.61%
via Portfolio Visualizer

That the relative returns are time-period dependent is more evidence that luck is more likely than persistent skill to be the driving force.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Kenkat » Wed Jun 21, 2017 8:39 pm

avalpert wrote:
Kenkat wrote:
avalpert wrote:
sport wrote:I understand and agree with all the logic favoring index funds. However, what do we say about PRIMECAP fund? It's performance has been too good over the years to attribute it to "just good luck".
In what way? Since Vanguard's Midcap Index fund started in June '98 it has outperformed Primecap with identical sharpe ratios. Now, that isn't the perfect comparison but it is close.
Not sure about those numbers but over the past 15 years, annualized returns:

Primecap Admiral 11.39%
Mid-cap Index Admiral 9.99%
I looked at the original Primecap vs. the Mid-Cap investor shares for the longer timeline:

Primecap 9.46%
Mid-Cap Index 9.61%
via Portfolio Visualizer

That the relative returns are time-period dependent is more evidence that luck is more likely than persistent skill to be the driving force.
The driving force is the low costs and low turnover of both funds. Most long term studies show that managers neither add nor detract from performance before costs. Since Vanguard's active and index funds have relatively similar costs, they have relatively similar performance.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by oldzey » Wed Jun 21, 2017 8:47 pm

nedsaid wrote:I just had to laugh at the "Hell No" chart, simple and direct. Thanks for the chuckle.

Edit: I wonder if the thread will get locked. Not family friendly and all of that. ;O)
I chuckled and then added Nisi's graphic to my IPS. 8-)
nisiprius wrote:But perhaps I can make it simpler. Personally, I can stop right here:

Image
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by nisiprius » Wed Jun 21, 2017 8:58 pm

sport wrote:I understand and agree with all the logic favoring index funds. However, what do we say about PRIMECAP fund? It's performance has been too good over the years to attribute it to "just good luck".
What do we say about the Legg Mason Value Trust under Bill Miller's management, over the period 1991-2005? It beat the S&P 500 fifteen years in a row. If you assume that the chances of beating the S&P before costs are 50%, then the probability of that happening by chance alone is about 0.003%. The chances of it happening after the >1% costs are even smaller.
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by gkaplan » Wed Jun 21, 2017 9:09 pm

sport wrote:I understand and agree with all the logic favoring index funds. However, what do we say about PRIMECAP fund? It's performance has been too good over the years to attribute it to "just good luck".
Think Bill Miller and the Legg Mason Value Trust fund.
Gordon

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by grabiner » Wed Jun 21, 2017 9:23 pm

Kenkat wrote:
Vanguard Fan 1367 wrote:Before I became a Boglehead I appreciate one of those advisors who recommend 5 star funds recommending Windsor 2 many years ago. I would have been better off with one of Vanguard's index funds but still the returns on Windsor 2 were pretty good, especially compared to something like active management with 1 percent charge for assets under management plus another one percent fee on the mutual fund, and perhaps a 3 percent or 5 percent load to get into it.
You were probably better off in Windsor II before 2004 as Vanguard's Value Index funds tracked terrible indexes with poor value exposure, high turnover and relatively poor performance. They switched indexes in 2004 and results have been much better. Windsor II has still mostly tracked the Russell 1000 Value Index.
I used to hold Windsor for the same reason. I had an employer plan which offered both Windsor and Value Index; I chose Windsor because it had better value exposure at the time. (I have long since left the employer and rolled the plan into my Roth IRA.)
David Grabiner

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by TD2626 » Wed Jun 21, 2017 9:44 pm

nisiprius wrote:

Me, I just go straight to their flow chart.

Image
The Vanguard flowchart implies that one has to identify outperforming managers to invest in active. This is as strange to me as claiming that one has to identify outperforming stocks to invest in equities.

You can use index funds and never have to pick stocks. Similarly, one can create a passive, buy and hold DIY index fund of active funds (or funds of funds). Investing in, say, 15 active funds would largely diversify away individual manager risk, so you would get the average return of active, before fees. This sort of thing can be accomplished through things like low cost funds of funds. If expense ratios are low enough (such as Vanguard Wellington Admiral's 0.16% or the Vanguard STAR fund of fund's 0.32%), the returns after expenses would likely be very close to the index funds. Investing in high (>0.5%) expense ratio active funds is not advisable because the expenses are excessive and represent money lost forever, unlikely to be earned back in sufficient alpha. If it turns out that active funds are on average able to exploit market inefficiencies caused by individual stock investors buying on "hot tips" without regard to price, then the average active return could be slightly higher than index returns. If this alpha is negative, nonexistent, or not large enough to overcome expense ratios or tax drag, then the return would be slightly lower.

Identifying active funds involves looking at the expense ratio, and then looking at the other things that matter, like what it invests in and what company manages it. First thing I ask when I buy something at the store is "how much does it cost?". Then, if and only if it's in my price range, do I "ask how does it work and does it meet my needs". Funds are not like normal products you buy - paying more does not get one higher quality.

One would of course want index funds to be an overwhelming portion of the portfolio - but putting 5-10% in a passive portfolio of low cost, broadly diversified active funds may be reasonable. However, it adds little value and introduces large amounts of complexity into the portfolio (and simplicity is an important tenant of Boglehead philosophy.) Thus, I don't think this sort of thing is a good strategy for most. But it's the only rational way to have an investment in active funds if one feels they must - any other way involves varying degrees of speculation in my opinion.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by baw703916 » Wed Jun 21, 2017 10:10 pm

I think I have less ability to identify outperforming managers than outperforming stocks.
Most of my posts assume no behavioral errors.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Thesaints » Wed Jun 21, 2017 10:26 pm

Investing in many active funds is substantially equivalent to investing in index funds, but paying active funds prices.
Unless someone can identify outperforming active funds, and nobody can do it reliably, investing in passive funds has a higher expected return (due to lower costs and generally better tax efficiency).

Investing in active funds, on the other hand, provides higher volatility and sometimes one is forced to rely on the positive side of volatility in order to achieve targets orherwise unattainable.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by stlutz » Wed Jun 21, 2017 11:07 pm

Just to make a cautionary point, there is commonly an assumption on this board that passive investing necessarily outperforms active investing. It generally does, but that is because of costs. If the cost of active = the cost of passive, then any active fund has a 50/50 chance of outperforming.

Or to put it another way, given their roughly equal expense ratios, I don't think it's obvious that the balanced index fund is a better choice than Wellington. I'm personally indifferent between the two.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Thesaints » Wed Jun 21, 2017 11:24 pm

The point is that, not counting costs, investing in an index fund will give you exactly the fund performance. If instead one invests in one of the many active managed funds focused on the same investing universe, there is no way to know in advance whether that fund will under- or outperform the index. Furthermore, the same active fund at times will do better than the index and at other times will do worse. Again, no way to know in advance what will happen when.

If one takes the index performance as a reference, the passive fund has zero volatility, while active funds have higher than zero volatility.
Of course, it is a matter of perspective: if one takes the active fund performance as a reference, it is the index fund (and all the other active funds) which has volatility greater than zero.

In general, one can say that going active introduces another stockastic variable, manager performance, which results in added volatility. It does not mean that all active funds are more volatile than the index, of course, but only that the process of selecting an active fund introduces additional volatility.

This is not always undesirable. Higher volatility also means the possibility of higher gains.
Naturally, even when costs are factored in, it is not true that passive investors outperform all active investors. It is only true that passive investors outperform the average return of all active investors, which is quite a different thing.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by ucla-engineer » Wed Jun 21, 2017 11:32 pm

avalpert wrote:
packet wrote:What's the difference between identifying a outperforming manager and identifying an advisor or consultant who can identify an outperforming manager?
One skill would make you a good fund management company exec and the other would make you a good financial advisory firm exec
I'll add...And if you think you have the skills to be in an executive position at either of these companies you should be applying for a job there, not trying to figure out how to gain an extra .5-1% in return on your portfolio.

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by oldzey » Thu Jun 22, 2017 1:38 am

Also don't forget about the 5.75% sales charge load that some mutual fund companies charge (in addition to the fund's expense ratio).
"The broker said the stock was 'poised to move.' Silly me, I thought he meant up." ― Randy Thurman

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by BogleAlltheWay » Thu Jun 22, 2017 9:20 am

nisiprius wrote:
But perhaps I can make it simpler. Personally, I can stop right here:

Image
I love the chart.

Does Vanguard really have any other choice? The public wants active funds. People will always point to a fund that has outperformed, such as the Contrafund. Or they just want to chance to outperform the market.

These are my options:
1. IF I have the resources, IF I have the expertise - translation - (If you spend every waking hour looking at managers you might have a shot)
2. IF I believe a trusted partner - I need to decide if someone who says they have the resources and expertise translation- (If you know Warren Bufffet)
Also note the disclaimer at the bottom

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by MnD » Thu Jun 22, 2017 9:31 am

I hold 20% of my portfolio by choice in the 4 main Dodge and Cox Funds (Stock, International Stock, Income and Global Bond) and will likely run that up to 25%-30% in retirement when some additional funds move from her 401-K to an IRA. The rest is 100% index.

Overall I'd contend the Dodge and Cox funds have performed better than than index funds over the periods I've owned them, 27 yrs for Stock, since inception for both International Stock and Global Bond and 3 years for Income. They are not closet indexers and over short periods can diverge significantly from index returns for better or for worse.

I'm comfortable with the relatively low fees, management structure and style at Dodge and Cox including their bottom-up team approach to investment selection.

https://www.dodgeandcox.com/performance.asp

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by nisiprius » Thu Jun 22, 2017 9:41 am

My personal honest not-too-carefully-researched feeling is that there's some evidence that active managers can get something like 0.50%-0.75% of alpha, although it's not clear to me what set of investors they are taking it away from. Against that, we find that actively managed funds seem to keep all or, best case, most[/]b of that alpha for themselves. Decent index stock funds are now showing expense numbers like 0.05% for U.S. stocks, 0.12% for international stocks. In comparison, relatively low-cost actively managed funds are showing numbers like 0.68% (Fidelity Contrafund), 0.66% (American Growth Fund of America), 0.73% (MFS Massachusetts Investors Trust). The star manager-type funds, of course, charge 1% and well over. Even Vanguard's PRIMECAP charges 0.39%, Windsor 0.30%.

So if you believe in the 0.50%-0.75% number, it's possible nowadays to find funds where the alpha might be larger than the added cost. The managers might be sharing half of their alpha with their fund investors. But it's still not a huge difference... and in return you get uncertainty, the possibility of market underperformance, the need to monitor the managers' public statements, possible changes in strategy, and check on whether the manager still has the mojo, the fire in his belly, or might be beset by personal demons.
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by BogleAlltheWay » Thu Jun 22, 2017 9:49 am

MnD wrote:I hold 20% of my portfolio by choice in the 4 main Dodge and Cox Funds (Stock, International Stock, Income and Global Bond) and will likely run that up to 25%-30% in retirement when some additional funds move from her 401-K to an IRA. The rest is 100% index.

Overall I'd contend the Dodge and Cox funds have performed better than than index funds over the periods I've owned them, 27 yrs for Stock, since inception for both International Stock and Global Bond and 3 years for Income. They are not closet indexers and over short periods can diverge significantly from index returns for better or for worse.

I'm comfortable with the relatively low fees, management structure and style at Dodge and Cox including their bottom-up team approach to investment selection.

https://www.dodgeandcox.com/performance.asp
When you look on the above link, the Stock fund beats the S&P 500. When you look on Morningstar
http://performance.morningstar.com/fund ... ture=en-US the S&P 500 TR USD
beats the Dodge and Cox funds.
I know the time periods are different, but is this a marketing trick by using the S&P 500 as a comparionsion instead of the S&P 500 TR?

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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by MnD » Thu Jun 22, 2017 10:20 am

BogleAlltheWay wrote: When you look on the above link, the Stock fund beats the S&P 500. When you look on Morningstar
http://performance.morningstar.com/fund ... ture=en-US the S&P 500 TR USD
beats the Dodge and Cox funds.
I know the time periods are different, but is this a marketing trick by using the S&P 500 as a comparionsion instead of the S&P 500 TR?
Rather than cast aspersions about the performance reporting from a well respected investment firm that's been in business for almost 90 years as "marketing tricks" you might start by first defining what time period you are concerned about and then compare for yourself the Dodge and Cox figures with those calculated on Morningstar. I took the 2 minutes or so to compare DODGX and S&P 500 total return for the 5-year period ending 3/31/2017 and found the performance figures reported by Dodge and Cox and Morningstar to be identical to the 2nd decimal place.
DODGX 15.24% S&P 500 TR 13.30%

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saltycaper
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by saltycaper » Thu Jun 22, 2017 11:46 am

nisiprius wrote:

Me, I just go straight to their flow chart.

Image
The first question is perhaps the silliest thing I have ever seen with Vanguard's name on it. The only logical conclusion I can draw is they intended it to be so.
"I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said." --Alan Greenspan

Theoretical
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Theoretical » Thu Jun 22, 2017 12:30 pm

I think Swedroe has made a good point distinguishing between passive-index, passive-non-index, and active.

The Vanguard bond funds (save the Core Bond fund) are passive non-indexers, not active for the most part. This is partly because there's far more bonds outstanding than are indexed. I'd classify it a lot differently than say PIMCO's brew. Bond active funds do have one advantage over indexes in that they can get institutional discounts on new issue debt.

Their stock funds are more along the lines of cheap closet index funds with some tweaks on the margins, especially the quant group's funds.

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BogleFanGal
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by BogleFanGal » Thu Jun 22, 2017 1:05 pm

Interesting thread, but I know I'd love to close out my taxable Wellington fund right now and move the money into existing total stock & total bond funds instead. Unfortunately one of several mistakes made early on when I didn't know enough about indexing and too painful to reverse right now for tax reasons. Gotta live with it for a few more years. :(

Tamalak
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Re: Vanguard: HOW MUCH active management is right for you? :(

Post by Tamalak » Thu Jun 22, 2017 3:16 pm

It's real shameful. I have 0 problem with Vanguard offering active funds - if there is legitimate, not-juiced-up demand for a product, go ahead and provide it! But PUSHING active funds is a betrayal of bogleheadism!

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