cancel
Showing results for 
Search instead for 
Did you mean: 
     
FD1001
Valued Contributor

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@outandabout wrote:

If one still requires the income that PIMIX provides could additional $$$$ be placed in VG's High-Yield Corp(VWEHX) with the same degree of safety?


No, apples and oranges.  VWEHX volatility is much higher.

pimix 11-11.PNG

0 Kudos
Highlighted
arriba
Participant ○○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@FD1001 wrote:

@outandabout wrote:

If one still requires the income that PIMIX provides could additional $$$$ be placed in VG's High-Yield Corp(VWEHX) with the same degree of safety?


No, apples and oranges.  VWEHX volatility is much higher.

pimix 11-11.PNG


Neither archer's or FD's replies or link/chart properly answer outandabout's question about the safety of the income from WHEHX vs PIMIX.   

You'd need to look at the histories of their respective divies, NOT their historical TRs, volatility or the like.

For their respective divies histories:

https://www.dividendinvestor.com/dividend-history-detail/vwehx/

https://www.dividendinvestor.com/dividend-history-detail/pimix/

I'm very familiar with PIMIX having owned it since near its inception with a worthy position in it currently.  I've conversely only owned VWEHX a short time or two in that time span. 

That said, a cursory look at their respective divies histories shows:

PIMIX's monthly divies (of course, to anyone who follows the fund) have been locked in at 0.0555 with a sometimes YE special divy all the way back to 2014. 

VWEHX's divies have also been very consistent for that same period with only negligible monthly variances.

So, YES, VWEHX's income is nearly as safe as PIMIX's.      

outandabout
Participant ○○○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

Thanks for the counter response,  arriba. I use both apples and oranges for income..........that being said, I hold T, ENB, ABBV for income+.

0 Kudos
anatfizz1
Follower ○○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

This thread makes me feel like a real pauper in that PIMIX has a minimum buy in at $1M.  Am I reading the comments of a bunch of millionaires?  If so, good for all of you. Tried to get Fidelity to transfer my high ER PONAX to PIMIX this morning but no deal. Should have done more research before I invested in it.  Live  and learn.

0 Kudos
FD1001
Valued Contributor

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@anatfizz1 wrote:

This thread makes me feel like a real pauper in that PIMIX has a minimum buy in at $1M.  Am I reading the comments of a bunch of millionaires?  If so, good for all of you. Tried to get Fidelity to transfer my high ER PONAX to PIMIX this morning but no deal. Should have done more research before I invested in it.  Live  and learn.


Your question was answered many times.  You can get PIMIX at Vanguard with just $25K and at Schwab with $100K min.

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

To the question of PIMIX vs VWEHX income: I don't think you should look at any position starting from the distributions.  You should look at performance + risk attributes first and then dists.  I can easily show funds with high distr and bad risk/reward.

This subject was debated for years on M*.

PaulR888
Participant ○○○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

Anat ...  I thought I told you before that if with Fidelity and don't want to go through Vanguard loop you can ask Fidelity for a no cost transfer to the Class I-3 share class.  In your case, PONAX would become PIPNX.  You save a little ER this way.  

Edit:  Every brokerage has its quirkiness on fund availability and minimum investment amount.  I am with Fidelity but when I check the Schwab website it seems I would not be able to afford any of my bond OEFs (DoubleLine, Pimco and TCW) as it appears they all have $100K minimums.  I find that very surprising.  

0 Kudos
RainGater
Participant ○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@anatfizz1 wrote:

This thread makes me feel like a real pauper in that PIMIX has a minimum buy in at $1M.  Am I reading the comments of a bunch of millionaires?  If so, good for all of you. Tried to get Fidelity to transfer my high ER PONAX to PIMIX this morning but no deal. Should have done more research before I invested in it.  Live  and learn.


You can get PIMIX at $0 in TD Ameritrade. Yes, $0 is the min investment and not sure how you would do that but for the safer side, you can invest $1. There you go and don't have to be a millionaire. :)

image.png

arriba
Participant ○○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@FD1001 wrote:

@anatfizz1 wrote:

This thread makes me feel like a real pauper in that PIMIX has a minimum buy in at $1M.  Am I reading the comments of a bunch of millionaires?  If so, good for all of you. Tried to get Fidelity to transfer my high ER PONAX to PIMIX this morning but no deal. Should have done more research before I invested in it.  Live  and learn.


Your question was answered many times.  You can get PIMIX at Vanguard with just $25K and at Schwab with $100K min.

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

To the question of PIMIX vs VWEHX income: I don't think you should look at any position starting from the distributions.  You should look at performance + risk attributes first and then dists.  I can easily show funds with high distr and bad risk/reward.

This subject was debated for years on M*.


Income from an investment, to anyone who speaks the language correctly, means dividends and other distributions.

You can make up your own definition for income, as you do for risk, investment success, and any other topic as you see fit, but you're going to have a hard time selling them to reasonably intelligent investors.

0 Kudos
dtconroe
Contributor ○○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@outandabout wrote:

@archer wrote:

In the last paragraph Ivascyn seems to think his fund is able to "maintain flexibility". This has been the main concern among many of us due to the funds size. 


I hold my max of this fund archer, and have the same concerns. I wonder what PIMCO could be used as an alternative?

 


outandabout, I have posted many concerns I have about PIMIX, but thought it might be worth noting on this thread that I have chosen to put some money into PIMIX recently.  Although I have many concerns, and I don't think PIMIX is as good as it was when I invested in it in the past, I have to look at it "comparatively" with other funds, and decide what kind of investment fits my investing style and skill sets.  I don't intend to hold PIMIX in as large of a portfolio position as in the past, and I have chosen to "surround" PIMIX with some more conservative bond oefs in my portfolio.  There are many good "income" funds each investor can consider, but if you are trying to become more of a longer term investor, you have to consider what you are more likely to hold when market conditions are negative and more scary--that will vary with each investor.  I think I can hold PIMIX in more scary and negative market conditions, but not in a comparatively large portfolio percentage position--it will not be my largest portfolio position any longer.

0 Kudos
RickatMirage
Explorer ○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

Based on the referenced PIMIX fund update, it would appear that the managers are managing the fund for increasing credit and interest rate risk. Since income is the primary goal of this fund, one would assume it will take precedence over total return. It has performed well lately in this latest period of rising interest rates. They still believe that mortgage credit is the primary tool to achieve their goals in the current environment.


@dtconroe wrote:

@outandabout wrote:

@archer wrote:

In the last paragraph Ivascyn seems to think his fund is able to "maintain flexibility". This has been the main concern among many of us due to the funds size. 


I hold my max of this fund archer, and have the same concerns. I wonder what PIMCO could be used as an alternative?

 


outandabout, I have posted many concerns I have about PIMIX, but thought it might be worth noting on this thread that I have chosen to put some money into PIMIX recently.  Although I have many concerns, and I don't think PIMIX is as good as it was when I invested in it in the past, I have to look at it "comparatively" with other funds, and decide what kind of investment fits my investing style and skill sets.  I don't intend to hold PIMIX in as large of a portfolio position as in the past, and I have chosen to "surround" PIMIX with some more conservative bond oefs in my portfolio.  There are many good "income" funds each investor can consider, but if you are trying to become more of a longer term investor, you have to consider what you are more likely to hold when market conditions are negative and more scary--that will vary with each investor.  I think I can hold PIMIX in more scary and negative market conditions, but not in a comparatively large portfolio percentage position--it will not be my largest portfolio position any longer.


 

0 Kudos
DGC
Explorer ○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

Dan Ivascyn was interviewed on The Long View, a Morningstar Podcast hosted by Christine Benz and Jeff Ptak back in Sept.  Ivascyn explains his and the teams process for his funds and some of his macro views. Worth the listen if you are either investing in or considering investing with him. Here is the link:

https://www.morningstar.com/podcasts/the-long-view/20

 

 

0 Kudos
archer
Participant ○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

I can understand the concept of a fund focusing on income over return, but how would a fund actually do this? Don't distributions come out of the funds TR? 

Mortgage credit is also the primary investment of IOFIX which has much higher TR and a comparable div. I am not seeing how PIMIX's holding mortgage debt would be the reason for lower TR. There seems to be a broad range of TR between securitized funds eg SEMPX vs OIFIX. What are to 2 funds doing differently with their investing, given that both are 97% securitized?

0 Kudos
yogibearbull
Valued Contributor

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@archer wrote:

I can understand the concept of a fund focusing on income over return, but how would a fund actually do this? Don't distributions come out of the funds TR? 

Mortgage credit is also the primary investment of IOFIX which has much higher TR and a comparable div. I am not seeing how PIMIX's holding mortgage debt would be the reason for lower TR. There seems to be a broad range of TR between securitized funds eg SEMPX vs OIFIX. What are to 2 funds doing differently with their investing, given that both are 97% securitized?


Distributions come from dividends/interest received plus realized CGs. The fund manager may also juice up distributions by holding premium bonds that he/she knows would mature at par.

So, distribution orientation for bond funds is different from TR orientation.

YBB
arriba
Participant ○○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@archer wrote:

I can understand the concept of a fund focusing on income over return, but how would a fund actually do this? Don't distributions come out of the funds TR? 

Mortgage credit is also the primary investment of IOFIX which has much higher TR and a comparable div. I am not seeing how PIMIX's holding mortgage debt would be the reason for lower TR. There seems to be a broad range of TR between securitized funds eg SEMPX vs OIFIX. What are to 2 funds doing differently with their investing, given that both are 97% securitized?


There are a lot of posters on M* forums who think they understand securitized bonds. 

Generally, they don't. 

Nor do I.

I learned the latter two truisms a year or two ago when poster aubergine made a detailed post about securitized bonds that made my head spin so fast it hurt. 

If you can locate that post - which I sadly think was on the old forum format - and you can carve deep into the respective holdings of the bond OEFs you are comparing, you might be able to make an informed decision about them.

More likely than not though, you won't, as the topic is generally one that only higher pay grade investors can truly comprehend and process.

That will not however stop the masses of other posters here who think they understand the topic to endlessly post about it in authoritative tones.

Aside:  FWIW, this and one particular Bond Forum thread ("A Slightly Different Bond OEF Thread") truly are valuable threads. 

BUT...

I really hope readers take a LOT of what is posted here/there with a proverbial grain of salt, and do what I and many others do.  That is, understand that bonds have a place in many/most portfolios, but stocks and CEFs are where real money is made. 

This endless stream of posts about which bond OEF is marginally better or safer than the next seems to me like a great waste of time, energy and investors dollars, especially in years like 2019 when stocks are returning 2x-4x more than bonds (save LT bonds) and required very little effort in picking BIG winners. 

Thanks again Tom Lee for your astute, smack on 2019 stock market projections you made at EOY 2018/BOY 2019 that prompted me to load up again this year on stocks and largely forsake bonds other than my ballast bonds and a (previously cashed in) spec play on LT bonds.

chang
Valued Contributor

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

I posted this in the "A Slightly Different OEF Bond Thread" during one of its PIMIX tangents, but as this thread is about PIMIX I will post it again here. JMHO.

*     *     *    *     *     *     *     *     *     *     *     *     *     *     *    *     *     *     *     *     *     *     *     *     *     *     *

Am I the only person who won't touch a "multisector" fund that is supposed to be flexible and maneuverable, but has $130 billion in assets, with a 10-foot pole?

Do you know how much $100 billion is? 

With $100 billion you could buy 258 Boeing 747s and establish the world's biggest airline. 

With a GDP of $95.6 billion dollars, you could buy Slovakia. (With $130 billion you could buy Ukraine and still have $18 billion left over.)

Or you could own a full-scale version of the board game "Battleship." Two small fleets, each with its own aircraft carrier, would come in at around $50 billion, and you could spend the rest on fuel, ammunition and personnel.

With only $50 billion you could buy the Palace of Versailles with 700 rooms, 600 paintings, 400 sculptures and 1,400 fountains. And you would still have enough left over for the White House ($400 million), Buckingham Palace ($5 billion), the Winter Palace in St. Petersburg ($6.4 billion) and Tokyo's Imperial Palace ($12.3 billion).

Or you could buy the Louvre and all its contents for a modest $45 billion, and go shopping for more art museums.

But if you prefer sports to art, you could buy every team in the NFL, and have enough money left over to buy every team in Major League Baseball, the NHL, and the English Premier League.

Think about that the next time PIMIX misses a beat.

0 Kudos
Bazinga
Participant ○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

Well said "arriba"!

Unfortunately it is likely that some M* members have been overly influenced by certain posters with regard to Momentum Trading of OEF Bonds, wasted time/money chasing past-performance, and have maintained too low an exposure to equities throughout this historic equity bull market. To be sure most investors (even retirees) need some equity exposure (often more than some) to ensure their long-term financial well-being.

cegibbs
Participant ○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

Very well stated, Arriba.  I totally agree with you.  

0 Kudos
bilperk
Participant ○○○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@arriba wrote:

@FD1001 wrote:

@anatfizz1 wrote:

This thread makes me feel like a real pauper in that PIMIX has a minimum buy in at $1M.  Am I reading the comments of a bunch of millionaires?  If so, good for all of you. Tried to get Fidelity to transfer my high ER PONAX to PIMIX this morning but no deal. Should have done more research before I invested in it.  Live  and learn.


Your question was answered many times.  You can get PIMIX at Vanguard with just $25K and at Schwab with $100K min.

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

To the question of PIMIX vs VWEHX income: I don't think you should look at any position starting from the distributions.  You should look at performance + risk attributes first and then dists.  I can easily show funds with high distr and bad risk/reward.

This subject was debated for years on M*.


Income from an investment, to anyone who speaks the language correctly, means dividends and other distributions.

You can make up your own definition for income, as you do for risk, investment success, and any other topic as you see fit, but you're going to have a hard time selling them to reasonably intelligent investors.


Anyone who looks at VWEHX will see FD is correct;  Apples to Oranges and income is not safe, unless your definition of safe is 5 years on income.

Look at PV for VWEHX and you will see two things:

1) Since 1985 that CAGR for those taking distributions was -.99% per year.  10K became 7K
2) Income in 1985 was $1417 for each 10K.  Income in 2018 was $387.

There is no flexibility in VWEHX.  I holds higher grade junk all the time and its income falls with rates, while its NAV erodes by 1% per year over its entire life.

So while it was a great short term play in late 2008 at 12% yield and an NAV in the $3s, its income is in a continual downward trend.

And I'm not suggesting PIMIX's income is going to be safe over time.  No one knows.

chang
Valued Contributor

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows

I’m not convinced about the VWEHX “constantly eroding NAV” claim. This has been discussed several times in the past. There is a lot of volatility in the chart. The major erosion took place from 1998-2008. Otherwise during the period from 1980-2019 it has been up and down but on the whole level. It looks pretty flat for the last five years, with the usual short term short term volatility.

Is there a fundamental reason to believe that its NAV should erode by 1% a year? If not - if this is just chart reading - then I think the situation is anything but clear.

0 Kudos
bilperk
Participant ○○○

Re: PIMIX Income Fund Update: Taking a Patient Approach as Growth Slows


@chang wrote:

I’m not convinced about the VWEHX “constantly eroding NAV” claim. This has been discussed several times in the past. There is a lot of volatility in the chart. The major erosion took place from 1998-2008. Otherwise during the period from 1980-2019 it has been up and down but on the whole level. It looks pretty flat for the last five years, with the usual short term short term volatility.

Is there a fundamental reason to believe that its NAV should erode by 1% a year? If not - if this is just chart reading - then I think the situation is anything but clear.


First, I didn't say constantly eroding NAV, I said "NAV erodes by 1% per year over its entire life"

Second, " 1980-2019 it has been up and down but on the whole level."  No.  1980 the NAV was $9.74.  Today it is $5.90.

And Yes, NAVs in HY bonds erode, most more than 1%.  For VWEHX, the bonds are at the top of the junk range.  Junk never goes to investment grade in general, it can only go down in grade.  So if a company gets in trouble, and the bond slips to a lower rating,  Wellington managers often sell the bond at a loss, but before defaults.  This is permanent loss and thus the erosion.  Lower grade HY funds often end up with bond defaults which causes even more erosion.  Does it happen each and every year, no.  does it happen over time, particularly in market downturns, yes.

For example, in 2018, it fell from 5.95 to 5.41.  It has now recovered to 5.90.  If it finishes the year at 5.90 or less that will be an erosion of .8% and this was a terriffic year for stocks and VWEHX.

And as I said, income, which was the issue, has fallen a lot since inception.

Announcements

To learn more about the recent changes to Morningstar.com, please see the updated FAQ.

See recent posts and all our forums or access the old forums here.
 

You can read the community guidelines in