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Revamped Wellington

As of 5/31, Wellington is down to 62 (from 64 on 4/30) equity holdings.  Neither M* nor Vanguard has a complete current list of the 62 holdings (both sites list the 80 stocks Wellington held as of 3/31).  The Vanguard site does show the current top 10 holdings, which include Alphabet at #2, Apple at #3 and Facebook (!) at #10.  I’m imagining a number of the fund’s energy holdings were either pared or eliminated.  In any event, aside from being a more concentrated fund, Wellington is now decidedly more growth oriented than before.  I wonder how much this shift will affect the fund’s quarterly distributions?

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Re: Revamped Wellington

We have to wait for the next report to see all of the changes due to manager change,   https://community.morningstar.com/t5/forums/forumtopicprintpage/board-id/bonds/message-id/6708/print...

YBB
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Re: Revamped Wellington

As for the upcoming distribution (this Friday 6/19), we will find out soon enough.  I expect it to go down.  And it looks like from all the turnover that the expected end of year capital gain distribution (reported on the Vanguard site) is going up.

I bought Wellington in 2004 because of its value-focused equity positioning.  I can understand why in today's market, that may be less attractive to new investors.  But I'm sure it will have an impact on investors like me.

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Re: Revamped Wellington

Apple and Google are very mature companies. 

Growth at reasonable price = awesome Value. (FAANGM?, Biotech and Pharma?)

Good companies at cheap price = Value (Financials - WFC, JPM etc)

 junk at very cheap price = deep value

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Re: Revamped Wellington

I still think Wellington is a pretty good fund from a good house.  I recall people commenting a few (?) years ago the fund was starting to get "growthy."  Which it has, but that isn't all a bad thing.  Due to that, now more than ever one can hold both Wellington AND Wellesley and not have a ton of overlap.  But with all those corp bonds, I think I would have a slug of treasuries as a ballast.

But yeah, sometimes it's maddening when looking up holdings to find outdated or incomplete info.

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Re: Revamped Wellington

 

So you think the past is prologue, then ponder what Jack Bogle wrote in the history of Wellington Fund having a long rocky road over two decades, over market conditions similar to today:
 
"After (assets ) cresting at $2 billion in 1965, the Wllington's long era of growth came to a temporary halt. Performance faltered badly, the dividend tumbled, and fund assets plummeted by 75%, to $470 million by mid 1982..."

John Bogle.

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Follow the fund flows into/out of Wellington.  A negative flow, combined with a poorer stock style choice (growth vs value) could get problematic.

R48

 

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Re: Revamped Wellington

What's working NOW is always going to be 'better' than what USED to be working; at least for MOST investors.  When something holds assets which are out of favor, it can only get away with that for just so long before officially becoming a 'poor' fund/asset.  For good or ill, growth is where you've had to be (and in the USA) if you wanted to be in a 'good' fund/asset.  Will that change?  Who knows?

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Participant ○○○

Re: Revamped Wellington

I own both the Balanced Index Fund and the Wellesley Fund at Vanguard and am pleased with both.

Gabe

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Re: Revamped Wellington

Wellington is big holding of mine at 10% of retirement assets. as of 5/31/20, these are the top holdings are per vanguard website, I do not see any cause for concern. I do not know much about PFE and MCD. But rest Looks very good to me.

 
 
1Microsoft Corp.
2Alphabet Inc.
3Apple Inc.
4Pfizer Inc.
5McDonald's Corp.
6Bank of America Corp.
7JPMorgan Chase & Co.
8Nestle SA
9Home Depot Inc.
10Facebook Inc.
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Contributor ○○○

Re: Revamped Wellington

Wellington is a 5-star fund that isn't doing as good right now as it normally does.  It is usually in the top quartile but is now down to the third quartile.  And, according to Morningstar its stock portion has become large cap blend instead of large cap value.

I'm OK with that.  I have another moderate-allocation fund, American Funds Balanced Fund, that is out performing Wellington. If I remember correctly its stock portion has always been large cap blend.  Its 12 month return is 7.23% vs. Wellington's 5.82%.  What I like about both of them is that they are both still outperforming their category/index.

From what I have read value stocks are out of favor.  They are often associated with dividends and there are a lot of companies cutting back dividends.  Hopefully, the change will let Wellington catch back up.

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Re: Revamped Wellington

Thanks @Mustang. I've been following this and appreciate the updates. In the past, I considered Wellington and Wellesley about the same but with opposite stock allocations. I was even mentally shopping for a more 'growth' allocation fund, but not now. In this market that makes less and less sense to me and changing so fast, the allocation funds are seeming like better choices. The managers are, I hope, changing from day to day, or hour to hour. Granted one gives up some FI/Equity control, but I've got plenty of other funds for that. I'm now wondering how diversified a Wellington/Wellesley split might be. @yogibearbull ;-)

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Re: Revamped Wellington


@bigsteve wrote:

I still think Wellington is a pretty good fund from a good house.  I recall people commenting a few (?) years ago the fund was starting to get "growthy."  Which it has, but that isn't all a bad thing.  Due to that, now more than ever one can hold both Wellington AND Wellesley and not have a ton of overlap.  But with all those corp bonds, I think I would have a slug of treasuries as a ballast.

But yeah, sometimes it's maddening when looking up holdings to find outdated or incomplete info.


True, it would give one more diverse equity and both funds are well managed and inexpensive. It is hard, however, to predict Wellington based in past performance.

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Re: Revamped Wellington


@rhythmmethod wrote:

<snip>

 I'm now wondering how diversified a Wellington/Wellesley split might be.

<snip>


Wellington/Wellesley Overlap - 03/31/20

Link

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Re: Revamped Wellington

@Lawyerli:

Facebook was not in the holdings of the fund dated 2019-12-31.  In  the holdings dated 2020-03-31, the market value of the shares of Facebook in the fund was 1.0% of the market value of the stocks in the fund.

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Re: Revamped Wellington [Correlation]


@yogibearbull wrote:

We have to wait for the next report to see all of the changes due to manager change,   https://community.morningstar.com/t5/forums/forumtopicprintpage/board-id/bonds/message-id/6708/print...


Looking at 20-day [default] correlations of VWELX vs LC-value VYM, and vs LC-blend SPY, we see that VWELX has better correlation with SPY since Pozen formally joined 3/28/19- and that has only increased in recent months. This is more dramatic if the correlation parameter is reduced from default 20 to 10 or 7.    https://stockcharts.com/h-sc/ui?s=VWELX&p=D&st=2019-03-28&id=p47339745803

Screenshot 2020-06-16 18.17.36.png

YBB
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Re: Revamped Wellington


@rila3400 wrote:

@rhythmmethod wrote:

<snip>

 I'm now wondering how diversified a Wellington/Wellesley split might be.

<snip>


Wellington/Wellesley Overlap - 03/31/20

Link

Thanks Yogi, you really are so kind with your expertise. I hope you are doing well and the back is in good shape. Take care!


 

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Re: Revamped Wellington

FYI, if someone interested in starting a new position in Vanguard Wellington it is no longer available at Fidelity.  Don't know about other brokerages.  

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Re: Revamped Wellington


@PaulR888 wrote:

FYI, if someone interested in starting a new position in Vanguard Wellington it is no longer available at Fidelity.  Don't know about other brokerages.  


A few years ago, the fund closed, except for those who invest directly at Vanguard.  The summary prospectus dated March 27, 2020 has supplement page that contains: "Vanguard Wellington Fund will be closed to all prospective financial advisory, institutional, and intermediary clients (other than clients who invest through a Vanguard brokerage account)."

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