cancel
Showing results for 
Search instead for 
Did you mean: 
     
Highlighted
Explorer ○○

Re: VFIAX vs. VDIGX

Thanks all for the thoughts and reactions!

I'm still on the fence. Even with reading all the posts and the previous threads on VDIGX, I am less and less convinced that VDIGX adds all that much to Wellesley as my safety net. Wellesley has the downside protection if that is the concern.

VFIAX on the other hand has much higher distributions than VDIGX, covers more stocks for diversification, and provides a good element of growth. 

Anyone think it would be a major mistake to sell all my VDIGX and relocate to VFIAX? Not getting a strong opinion on that yet.

 

0 Kudos
Highlighted
Frequent Contributor

Re: VFIAX vs. VDIGX


@Newer_Retiree wrote:

Thanks all for the thoughts and reactions!

I'm still on the fence. Even with reading all the posts and the previous threads on VDIGX, I am less and less convinced that VDIGX adds all that much to Wellesley as my safety net. Wellesley has the downside protection if that is the concern.

VFIAX on the other hand has much higher distributions than VDIGX, covers more stocks for diversification, and provides a good element of growth. 

Anyone think it would be a major mistake to sell all my VDIGX and relocate to VFIAX? Not getting a strong opinion on that yet.

       Not knowing where it fits on an overall plan, VDIGX has less risk, a larger expense ratio, is more conservative, costs about 5 times more so performance will lag. VFIAX has outperformed it recently but VOO the ETF beats both at less cost.
       
        You realize your switching from a dividend growth fund to a balanced fund? Less dividend growth for more possible capital growth? The tech holdings are probably holding up the index at this time? Sorta Apples to Oranges. Like I mentioned everything gets caught up when the market flushes. Managers can’t stop that so it’s probably the composition of the fund. Usually investors flee to dividends the so called downside protection. They fled to tech this time, you never know.

          So not a major mistake. No one knows what would offer better downside protection in the future. Make sure your not duplicating holdings of other funds. Your going from primarily value stocks and with an index losing some value and adding more growth companies.

 

0 Kudos
Highlighted
Participant ○

Re: VFIAX vs. VDIGX


@Newer_Retiree wrote:

In generally looking over the charts, especially since February, it SEEMS that VDIGX hasn’t exactly wowed on protecting the downside and that when ups and downs are compared/added together it appears to be essentially a wash with VFIAX.


The funds have performed very similarly over the calendar years that both have existed. A major difference is the total return of each fund from the date of its high in 2007 to its low in 2009. For VFIAX it was -55.2%. For VDIGX it was -42.4%.

0 Kudos
Highlighted
Frequent Contributor

Re: VFIAX vs. VDIGX

@steelpony10 , I think that @Newer_Retiree has both VWINX and div-growth VDIGX and is struggling to decide if to keep VDIGX or to switch to LC-blend VFIAX/VOO or another fund. He is not thinking about switching from VDIGX to VWINX.

I pointed out earlier that both VDIGX and VFINX are LC-blends. How about considering LC-growth VIGAX/VUG instead?

So, he ends up with conservative-allocation VWINX and LC-growth VIGAX.

 

YBB
0 Kudos
Highlighted
Contributor ○

Re: VFIAX vs. VDIGX


@Newer_Retiree wrote:

Thanks all for the thoughts and reactions!

I'm still on the fence. Even with reading all the posts and the previous threads on VDIGX, I am less and less convinced that VDIGX adds all that much to Wellesley as my safety net. Wellesley has the downside protection if that is the concern.

VFIAX on the other hand has much higher distributions than VDIGX, covers more stocks for diversification, and provides a good element of growth. 

Anyone think it would be a major mistake to sell all my VDIGX and relocate to VFIAX? Not getting a strong opinion on that yet.

 


I see no problems with selling VDIGX and putting the proceeds in VFIAX.  Actually, I think owning VFIAX is preferable to VDIGX.  I’m going through the same mental gymnastics.

0 Kudos
Highlighted
Frequent Contributor

Re: VFIAX vs. VDIGX


@yogibearbull wrote:

@steelpony10 , I think that @Newer_Retiree has both VWINX and div-growth VDIGX and is struggling to decide if to keep VDIGX or to switch to blend VFIAX/VOO or another fund. He is not thinking about switching from VDIGX to VWINX.

I pointed out earlier that both VDIGX and VFINX are blends. How about considering growth VIGAX/VUG instead?

So, he ends up with conservative-allocation VWINX and growth VIGAX.

         Sure growth. I believe I understood what he wanted to switch to. I checked the top holdings and both were balanced but both were off center left or right. I don’t know if it’s purpose was downside protection, dividend growth or what’s expected to be gained by the switch, less dividend growth and slightly more risk and maybe less downside protection? You would save on costs though. I had the same results with VYM and VUG as he had but tech stocks performed well. A dose of QQQ might help.

0 Kudos
Highlighted
Explorer ○○

Re: VFIAX vs. VDIGX

Thanks for the on target comments!

@yogibearbull--  I am not clear why you would recommend VIGAX with VWIAX. Yes, that would give me growth,I see that, but since Wellesley has a restricted number of stocks why not go with a blend? It would seem that a blend would give you the VEIPX enhancement I know you like with Wellesley and some of the growth. Wouldn't VFIAX, as a blend, do that as well?

Pat Morgan -- I am less concerned with what happened in 2008 than what is happening now in this downturn (crash?). YTD VFIAX is faring much better than VDIGX unless I am way off. Isn't that more relevant in looking forward ... do you think so as well or should I be more concerned about what VDIGX did 12 years ago? In a lot of the interim since 2009 VDIGX has not greatly distinguished itself on the downturns as far as I can see. Sometimes is appears that VDIGX does better and sometimes it's VFIAX.

Thanks again all. I look forward to your elaborations here.

And Yogi's right on, I am trying to simplify my portfolio. I do own a good hunk of Wellesley, some VDIGX and VFIAX, and the rest is divided between PIMIX and BAGIX, with more allotted to the former for income purposes. As a retiree of modest means, I am very conscious of the income/distributions aspect and because of health I doubt that growth that will benefit me in 20 years is a good tradeoff.

0 Kudos
Highlighted
Explorer ○○

Re: VFIAX vs. VDIGX

Steel Pony and Pat Morgan

I am not clear why Morningstar and others keep saying that VDIGX has much lower risk than the Index. If you take out the 2008-2009 blib, Porfolio Analyzer shows that VDIGX has an annual Volativity of 11.57% vs. VFIAX's 13.78%, a Beta of .95 vs. 1.00, and a Downside Deviation of -17.48% vs. -19.61, and the number/percentage of Postive Periods are the same.

Yes there is a difference there but is it meaningful enough to support the claim that VDIGX is much more conservative/lower risk?

What am I missing here? It just seems that VDIGX continues to be flavor of the month, especially at Morningstar, but right now I am just not getting it.

Thanks, Steve

0 Kudos
Highlighted
Contributor ○

Re: VFIAX vs. VDIGX

I think M* is definitely biased towards active because if they told
everyone to index it would adversely impact their business.
0 Kudos
Highlighted
Frequent Contributor

Re: VFIAX vs. VDIGX

@Newer_Retiree , VEIPX has been disappointing in how it has acted lately. I will be moving from supplementing VWIAX with EI/LC-value VEIPX to complementing it with LC-growth VIGAX [better downside, better rebound recently].  Chart from 2/19/20 high [may default to 1-yr in a few days].   https://stockcharts.com/h-perf/ui?s=VWIAX&compare=VEIPX,VIGAX&id=p27245955722

YBB
0 Kudos
Highlighted
Frequent Contributor

Re: VFIAX vs. VDIGX

Deciding between these two now boils down to whether you want to load up on FAANGs or not.

0 Kudos
Highlighted
Explorer ○○

Re: VFIAX vs. VDIGX

@yogibearbull

I just substitued VFIAX for VEIPX in your chart and VFIAX is showing a better come back than VIGAX. Why not go with that instead if performance is the issue?

0 Kudos
Highlighted
Participant ○

Re: VFIAX vs. VDIGX


@Newer_Retiree wrote:

Pat Morgan -- I am less concerned with what happened in 2008 than what is happening now in this downturn (crash?). YTD VFIAX is faring much better than VDIGX unless I am way off. Isn't that more relevant in looking forward ... do you think so as well or should I be more concerned about what VDIGX did 12 years ago? In a lot of the interim since 2009 VDIGX has not greatly distinguished itself on the downturns as far as I can see. Sometimes is appears that VDIGX does better and sometimes it's VFIAX.


Recent short-term results are not more relevant to me than long-term results. Especially with Vanguard mutual funds that tend not to make large changes to the investment approach. Although, VDIGX started in 2002 with an investment approach that was a large change from the fund that previously was the Vanguard Utilities Income fund.

The results since 2009 include the larger recovery that VFIAX had relative to VDIGX from immediately preceding larger drawdown.

0 Kudos
Highlighted
Explorer ○○

Re: VFIAX vs. VDIGX

@chang 

Thanks. Isn't "loading up" a little extreme?

Yes, there is a lot more allotment to FAANGS and tech than you would find with VDIGX (and also Wellesley), as they have very little tech at all.

Is it your view that going with "more" FAANGS and tech is not a good idea at present time or gazing into the future?

I appreciate hearing your thoughts.

0 Kudos
Highlighted
Frequent Contributor

Re: VFIAX vs. VDIGX


@Newer_Retiree wrote:

@yogibearbull

I just substitued VFIAX for VEIPX in your chart and VFIAX is showing a better come back than VIGAX. Why not go with that instead if performance is the issue?


Not in that chart. See with VFIAX added [2/19/20- ].   https://stockcharts.com/h-perf/ui?s=VWIAX&compare=VEIPX,VIGAX,VFIAX&id=p13581919386

Anyway, you had asked and I told you where I am going.

YBB
0 Kudos
Highlighted
Participant ○

Re: VFIAX vs. VDIGX


@Newer_Retiree wrote:

Steel Pony and Pat Morgan

I am not clear why Morningstar and others keep saying that VDIGX has much lower risk than the Index. If you take out the 2008-2009 blib, Porfolio Analyzer shows that VDIGX has an annual Volativity of 11.57% vs. VFIAX's 13.78%, a Beta of .95 vs. 1.00, and a Downside Deviation of -17.48% vs. -19.61, and the number/percentage of Postive Periods are the same.


I don't know why Morningstar and other keep saying that VDIGX has much lower risk than VFIAX. As I wrote in an previous post to this conversation: "The funds have performed very similarly over the calendar years that both have existed." In my opinion, there has not enough a difference in the performance to choose one fund over the other. Those who are more concerned about the size of drawdowns, would be more likely to have a different opinion.

0 Kudos
Highlighted
Contributor ○

Re: VFIAX vs. VDIGX

There is nothing wrong with FAANG. Does anyone really think those companies aren’t going to be very profitable in future. Alphabet, Apple, and Amazon are amazing companies.

Sent from my iPhone
Highlighted
Frequent Contributor

Re: VFIAX vs. VDIGX


@Newer_Retiree wrote:

@chang 

Thanks. Isn't "loading up" a little extreme?

Yes, there is a lot more allotment to FAANGS and tech than you would find with VDIGX (and also Wellesley), as they have very little tech at all.

Is it your view that going with "more" FAANGS and tech is not a good idea at present time or gazing into the future?

I appreciate hearing your thoughts.


Not extreme. Look at the percentages of the index.

I have no view right now on FAANGs. I would not avoid them nor would I heavily overweight them. I am (unusually) agnostic. They are not a traditional “value”, but they are what’s hot, and they’re probably going to stay that way for a while.

0 Kudos
Highlighted
Frequent Contributor

Re: VFIAX vs. VDIGX


@Newer_Retiree wrote:

Steel Pony and Pat Morgan

I am not clear why Morningstar and others keep saying that VDIGX has much lower risk than the Index. If you take out the 2008-2009 blib, Porfolio Analyzer shows that VDIGX has an annual Volativity of 11.57% vs. VFIAX's 13.78%, a Beta of .95 vs. 1.00, and a Downside Deviation of -17.48% vs. -19.61, and the number/percentage of Postive Periods are the same.

Yes there is a difference there but is it meaningful enough to support the claim that VDIGX is much more conservative/lower risk?

What am I missing here? It just seems that VDIGX continues to be flavor of the month, especially at Morningstar, but right now I am just not getting it.

Thanks, Steve


          Ha. Ha. Steve your getting it from all sides now. So you have a great value fund VWINX. Two whether you agree or not aggressive or HY bond funds, PIMIX and BAGIX and parts of two similar balanced funds that both bombed this time. The other three stood up pretty good.
           Notice growth of principle is missing. How about TRBCX, VUG or the active Vanguard fund recommended to replace your two that cratered. Drop them both. Posters are right. So you’ll have 3 parts, value, income and add a growth part. A secondary source of income, capital gains. When your growth fund goes up say 5% cash that in. That’s how you could enhance your income as often as that occurs staying ahead of your personal inflation rate at the same time.

0 Kudos
Highlighted
Explorer ○○

Re: VFIAX vs. VDIGX

@steelpony10 

Thanks again! I’d like to stay under the Vanguard roof and want to stay away from ETFs (too tempting to keep playing with them).

Which active Vanguard fund were you referring to in your post?

Yogi mentioned Vigax but that is an Index fund.

0 Kudos
Announcements