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Valued Contributor

2020 - bond funds analysis

Analysis at the end, after the performance.

Performance..1 month...YTD as of 12/31/2019

  • ·         Multi
  • ·         PDIIX……0.8.....12.8
  • ·         PUCZX….1.0..…12.5
  • ·         JMUTX....0.85....10.9
  • ·         JMSIX....0.6…….11.8 (JGIAX)
  • ·         Multi(high % securitized)
  • ·         PIMIX....1.3….8.05
  • ·         EIXIX……0.5….17.0
  • ·         VCFAX...0.0...7.1
  • ·         IOFIX.....0.0....11.9
  • ·         SEMMX...0.3....4.9  (ST duration, 3 year SD<1,over 30% IG(investment grade)bonds-good cash sub)
  • ·         DHEIX….0.2…..4.85 (ST duration, 3 year SD<1, over 80% IG bonds-good cash sub)
  • ·         HY Munis
  • ·         PHMIX…...0.45.....10.4
  • ·         MHMAX....0.6.....11.9  (usually 20+% leveeraged)
  • ·         MMHAX.....0.4.…..8.85
  • ·         OPTAX.....0.9......12.1
  • ·         ORNAX….…0.7…13.9 (lower-rated bonds than most)
  • ·         GHYAX......0.8......10.8
  • ·         GWMEX….…0.4…...11.3  (IG Munis but BBB+A rating)
  • ·         NVHAX…….0.5……..7.7  (ST duration HY Munis-lower SD than the above)
  • ·         Inter Term CORe/CORE PLUS
  • ·         USIBX.......0.4.....11.1
  • ·         BCOIX......0.15…....10.1
  • ·         PINCX……..-0.1..…….11.2
  • ·         BND….......-0.1…......8.8
  • ·         Bank Loans/Floating rate
  • ·         EIFAX.......2.0......9
  • ·         Uncontrain/Nontrad
  • ·         IISIX......0.7....8.4
  • ·         PUTIX......1.2….5.2
  • ·         PAJZX…….1.6….15.7
  • ·         HY +EM
  • ·         HYG.........0.6.....11.95
  • ·         PHIYX......1.6.....14.9
  • ·         ZEOIX……0.05…….5.5(ST HY, 3 year SD<1, IG at 20+%, good as cash sub)
  • ·         FNMIX……2.5…….10.9
  • ·         Corporate
  • ·         PIGIX….…0.3..….14.7
  • ·         Preferred
  • ·         PFINX…...1.3……20.4
  • ·         OTHER
  • ·         FXAIX.….3.0..…31.5  (SP500)
  • ·         PCI…….1.2...…33.05 (CEF)
  •  

Observations:
2019 was one of the best years for bond (and stocks) OEFs. The Fed gave us 3 cuts and most categories made easy money. I think rates stabilized around 1.7-2.3 for 10 years treasury.
Multi- Another good month and especially for PIMIX which had also great 3 months.
HY Munis continues to be a great category regardless of rate changes.
Inter term – did fantastic because rates were down
Bank loan – this category does well when rates go up but they are also correlated to HY and why they did well.
HY+EM – did very well last month and YTD but their volatility is much higher than Multisector funds and why I may use them for short term trades.
Corp – This category was on fire because of the rate cut.

The following are several great options

Multisector+NonTrad-...for SD<1 =SEMMX,ANGLX,DHEIX...For SD<1.5=IISIX,TSIIX…For SD<2=VCFIX,/VCFAX,JMUIX/JMUTX,PIMIX... for SD<2.7=IOFIX,PUCZX,DPFNX,JMSIX


HY Muni-...For SD<2=NVHIX,WHYIX,ISHYX...For SD<3=NHMRX/NHMAX,GHYIX/GHYAX,MMHIX/MMHAX

Core+Core plus-...for SD<1.5=FIJEX...for SD<3=PINCX,GTO

With the above in mind, I use basically 2 categories for bond funds
1) For IRAs my list for Multi+NonTrad includes IOFIX,EIXIX(new MBS fund with one year history),VCFAX,PIMIX,JMUTX,JMSIX/JGIAX,PUCZX. IMO these are top Multi-sector funds and can be used by most investors with different risk tolerance. If you want lower volatility funds then consider SEMMX+IISIX.
2) For taxable accounts, I use HY Munis mostly NHMAX,OPTAX,ORNAX. Others may consider GHYAX,MMHAX,PHMIX.

3) As a stock proxy for me, I can use PDIIX(multi-sector with SD=3.5)…or…PAJZX (NonTrad+derivatives, SD=4.3)…or… PFINX(proffered, SD=5.3)

For monthly commentary and what I do you have to be on the Fidelity site.  We can still discuss bond funds  :-)

 

234 Replies
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Valued Contributor

Re: 2020 - bond funds analysis

Add to Others, 1-mo, 12-mo:

Core-plus muni NZF  1.56%, 28.34%

Core-plus muni NVG  3.83%, 25.65%

HY muni NMZ  -0.21%, 28.42%

YBB
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Participant ○○○

Re: 2020 - bond funds analysis

THere has been much discussion on PIMIX over the past 2 years, much of which is concern about its AUM not being conducive to adapting to market changes. Yet it seems to always come around eventually. In 2018 when everyone was up in arms about it going flat it ranked 18 out of 326. 2019 not so great due to hitting a rough spot mid year, but seems to be getting back on track. I follow the bond OEF performance closely, and trade the losers for the winners, which then more often than not go flat. I probably would have done well to have kept PIMIX rather than selling most of it mid 2018. Not to turn this into another PIMIX thread, but,,,just sayin.

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Valued Contributor

Re: 2020 - bond funds analysis

Request: please include my bond funds in your listing:

VUSFX - MM sub
DODIX - vanilla IG
BCOIX - vanilla IG
VBILX - vanilla IG mostly Govt
FAGIX - HY
VWEAX - HY
PIGIX - IG corps
PUTIX - NT
SEMMX - NT
IISIX - MS
PHMIX - HY muni
VWALX - HY muni
PFMIX - IG muni
VWIUX - IG muni
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Participant ○

Re: 2020 - bond funds analysis

YBB,

Thanks for your muni ETF performance postings.  I am planning to try the following allocation for my Taxable accounts.

I am thinking of the following allocation for my taxable funds:

20% municipal bond etfs. 10% NZF, 10%NVG. (In 2019 I used MUB).

30% dividend stocks and dividend ETFs and Tax managed Equity fund. I am hoping that the majority of dividends earned will be qualified dividends eligible for lower tax rate.

In small measure I am trying out ETFs for the past 3 months- SPY, USMV, MOATS, VT, SCHD

I have also been using few stocks I have been trying since sept 2019. This is taking more time than I would like to spend.

I am also trying out PREFX - a TRowe tax managed equity fund. 

I have a modest size RMD coming into the taxable from IRA funds.

I am going to learn more when I do the taxes about consequences of having investments other than tax free municipal bond funds and ETFs.

SRT

 

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Valued Contributor

Re: 2020 - bond funds analysis


@FD1001 wrote:


HY Munis continues to be a great category regardless of rate changes.


Ain't that the truth. And they get very little discussion here. My muni exposure is roughly 3:1 in HY:IF munis. The HY is oddly "bar-belled" between PHMIX (aggressive) and VWALX (conservative). The IG is split between PFMIX and VWIUX.

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Participant ○○○

Re: 2020 - bond funds analysis


@chang wrote:

@FD1001 wrote:


HY Munis continues to be a great category regardless of rate changes.


Ain't that the truth. And they get very little discussion here. My muni exposure is roughly 3:1 in HY:IF munis. The HY is oddly "bar-belled" between PHMIX (aggressive) and VWALX (conservative). The IG is split between PFMIX and VWIUX.


I believe munis are underused and therefore not discussed as much due to not being considered in tax advantaged accounts. Of course they are more helpful in taxable accounts, but I see nothing wrong with holding them in my IRA and have at times when I thought they were on a roll.

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Valued Contributor

Re: 2020 - bond funds analysis

@sthanga , those are muni CEFs, not ETFs.

YBB
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Explorer ○○

Re: 2020 - bond funds analysis

Thanks FD for this bond listing. Your analysis of funds is always informational and accurate. I appreciate it because I have several long term holdings that you were instrumental in making me aware of.

I'm an old timer that goes back to your FundDaddy days along with names like Errol, Mazama, and Bubbygator.

I will say to the younger and/or newer investors that your REALLY NEED to understand what Standard Deviation, Sharpe ratios, and Sortino ratios mean, and how they will impact your portfolio. With investments it is all about how much return vs. how much risk.

 

 

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Contributor ○○○

Re: 2020 - bond funds analysis

Excellent overall recap post on bond OEFs. Will be a good reference for 2020.

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Contributor ○○○

Re: 2020 - bond funds analysis

Agree, Gary.

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Participant ○○

Re: 2020 - bond funds analysis

FD takes his bond oefs seriously, and throws some good info up here that saves lazy guys like me from doing the work ourselves.  ;-)

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Participant ○○

Re: 2020 - bond funds analysis

I think the YTD (2019) for FXAIX SP500 might be a little higher than 3.0%  ;-D

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Valued Contributor

Re: 2020 - bond funds analysis

archer "THere has been much discussion on PIMIX over the past 2 years, much of which is concern about its AUM not being conducive to adapting to market changes. Yet it seems to always come around eventually."

FD: look at my preferred Multi.  For 2019 PIMIX ranked at 77, in the last 3 months at 6.  For a trader like me it's hardly a problem  :-) 

pimix 1-2-2020.PNG

===============================

Chang: about HY Munis "Ain't that the truth. And they get very little discussion here."

FD: I have been discussing this category a lot.  It was such a good category in 2019 that at one point I owned over 60% of my portfolio in ORNAX and part of it was in the IRA

===============================

Wheaton:  With investments it is all about how much return vs. how much risk.

FD: Benjamin Graham, arguably the father of value investing, said in groundbreaking work published in 1934, “The essence of investment management is the management of risks, not the management of returns.”

===============================

bisteve: I think the YTD (2019) for FXAIX SP500 might be a little higher than 3.0%

FD: thanks, I fixed it. M* gave me so much trouble posting and deleted many of the monthly/yearly numbers.

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Valued Contributor

Re: 2020 - bond funds analysis

Muni fund inflows in 2019 were the highest since 2009, so some investors heard about them.   https://www.cnbc.com/2020/01/02/reuters-america-refile-update-1-u-s-muni-bond-funds-post-record-infl...

YBB
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Participant ○○○

Re: 2020 - bond funds analysis

Another bond category that is included in the OP but not discussed much is preferred stock. It has a higher SD than many people look for in a bond fund, but It has out performed many stock funds with much less volatility. Fidelity shows SD for PFANX at 4.53 and a sharp of 1.69. Seems like a good candidate for a pretend low vol stock fund. Any ideas on how this category is positioned going forward?

 

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Explorer ○

Re: 2020 - bond funds analysis

Excellent Bond Funds analysis.FD.
Thanks...I see PIMIX with a great position in 2019  @ year-end.
Thanks.
Majick

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Explorer ○

Re: 2020 - bond funds analysis

Guys...
This may be off the topic but If I do have PIMIX at TDAmeritrade IRA a/c,(It was acquired at WellsTrade & xferred to TDA.)

Is there a way/how Can I transfer a few shares TDA-->> Fidelity IRA a/c, of PIMIX & then add More shares.
Doable? Same PIMIX or any other class of PIMIX w/higher fee% ? In-NTF fees wise @ Fidelity.

Any thread here on the M* forum? Link, please.
I tried to search under PIMIX, kind of got lost navigating between new M* & Old M*, then gave up.
(old M* posts are not accessible?)

Thanks.
Majick

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Valued Contributor

Re: 2020 - bond funds analysis


@archer wrote:

Another bond category that is included in the OP but not discussed much is preferred stock. It has a higher SD than many people look for in a bond fund, but It has out performed many stock funds with much less volatility. Fidelity shows SD for PFANX at 4.53 and a sharp of 1.69. Seems like a good candidate for a pretend low vol stock fund. Any ideas on how this category is positioned going forward?

 


AGC is a good commentator and pro-investor. In this (link)..."Preferreds have been one of the best performing CEF sectors this year thanks to declining rates. There are many in this segment that are worth selling today."..."For an option to switch, we used JPT above but think you could also look at an open end fund like PIMCO Capital Securities Intl (PFINX). The fund has performed well as indicated in the chart below but doesn't have the premium risk (since it trades at NAV)."

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Valued Contributor

Re: 2020 - bond funds analysis


@Majick wrote:

Guys...
This may be off the topic but If I do have PIMIX at TDAmeritrade IRA a/c,(It was acquired at WellsTrade & xferred to TDA.)

Is there a way/how Can I transfer a few shares TDA-->> Fidelity IRA a/c, of PIMIX & then add More shares.
Doable? Same PIMIX or any other class of PIMIX w/higher fee% ? In-NTF fees wise @ Fidelity.

Any thread here on the M* forum? Link, please.
I tried to search under PIMIX, kind of got lost navigating between new M* & Old M*, then gave up.
(old M* posts are not accessible?)

Thanks.
Majick


You can transfer PIMIX to Fidelity and then buy more shares for $49.95 or use 
Automatic Investments and add for just $5.

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