I currently own Vanguard Global Wellington, but am thinking of selling it in favour of Vanguard Global Minimum Volatility. The primary reason is that I am getting my domestic and international bond exposure with other funds. I do not need the 31% that VGWAX offers. Also, I like the increased emphasis to mid caps in VMNVX.
YTD, Vanguard Globl Minimum Volatility has returned 7.17%. Vanguard Global Wellington, 3.49%. It seems the differences are attibutable to the bond exposure in Global Wellington and the the mid caps in Minimum Volitiltiy.
However, over the past month, Vanguard Global Wellington's return has exceeded Vanguard Global Minimum Volitility, 4.81% to 4.13%. This is a bit of a surprise to me with interest rates increasing. Could this be because large caps have done better in this period of time?
What are your thoughts with these two funds going forward?
I think a more significant factor is VMNVX's currency hedge. It's added 2 to 3% in return over its unhedged competitor, ACWV, over the past year, but was a real drag this past week. VGWAX does not hedge.
I'm using VGWAX as my sole exposure to foreign value, since my other foreign exposures are very growth-oriented. If Vanguard split off the equity part (or better yet, the foreign equity part) of VGWAX, I would own that, but they don't. You have to buy the whole package to get that.
Well, that’s no problem—Wellington Management have a proven record. Unfortunately, VGWAX isn't as cheap as VWENX, but it should be a long-term winner.
(*Note that Wellington holds a fair amount of foreign equity: 10.2/65.30 = 15.6% of total equity. Global Wellington foreign equity is 26.5/64.35 = 41.2% of total equity, as you would expect.)
This is an old thread from 2018. Normally, it is not possible to reply to old threads from old M* Discuss except for those on BU and VG forums - old threads from only those forums got migrated to new M* Discussions. This was a bad decision by M*.
Min volatility funds failed miserably in 2020 due to their rebalancing lag. Some were badly positioned for Feb-Mar crash, and then rebalanced per their schedules in what looked badly timed moves.
Anyway, I moved out completely from VMNVX and went into VGWAX. I do have foreign growth via other funds.