Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Mutual Fund Owners Take Note (Exp Ratios)
Old 04-19-2010, 01:37 PM   #1
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
freebird5825's Avatar
 
Join Date: Feb 2008
Location: East Nowhere, 43N Latitude, NY
Posts: 9,017
Mutual Fund Owners Take Note (Exp Ratios)

I ran across this article today at Morningstar.
http://news.morningstar.com/articlenet/article.aspx?id=332686

There is a link in first paragraph that opens to a table of average expense ratios for various classes of mutual funds from 1990-2009.
http://news.morningstar.com/pdfs/asset_ratios_0415.pdf
Some of those numbers certainly got my attention.

Back before I read enough investing books to understand how much "costs matter" over the life of a mutual fund based portfolio, I will admit to owning a few higher expense ratio funds. They have long departed from my holdings.
__________________

__________________
"All our dreams can come true, if we have the courage to pursue them." - Walt Disney
freebird5825 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 04-19-2010, 03:17 PM   #2
Thinks s/he gets paid by the post
Onward's Avatar
 
Join Date: Jul 2009
Posts: 1,667
Interesting article & pdf. I wish the pdf had had an "Intl Bond" column. I think I'm paying .81% ER for RPIBX, and that irks me a bit.
__________________

__________________
And if I claim to be a wise man, it surely means that I don't know.
Onward is offline   Reply With Quote
Old 04-19-2010, 04:23 PM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2007
Posts: 5,072
VG!
__________________
chinaco is offline   Reply With Quote
Old 04-20-2010, 09:45 AM   #4
Thinks s/he gets paid by the post
 
Join Date: Jul 2004
Posts: 1,072
Wow - the names of those companies/product offering that increased their fees - I've never even heard of them.

Short story - early on in my investing career, I went to a broker, a friend, and she recommended this fund. I was naive so had her start a monthly deduction for allocation to this fund. A year or two later I started educating myself about investing and when I looked at this fund, I was aghast at how much was a fee to her on a monthly basis as well as the expense ratio to the company - yikes - I got out of that fast, however, I did lose a bit of my money in the process. And I wasn't making a whole lot then....amazing how much of a cut the middle man can take.
__________________
Deserat aka Bridget
“We sleep soundly in our beds because rough men stand ready in the night to visit violence on those who would do us harm.” - George Orwell/Winston Churchill
deserat is offline   Reply With Quote
Old 04-20-2010, 08:26 PM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
FinanceDude's Avatar
 
Join Date: Aug 2006
Posts: 12,484
Quote:
Originally Posted by deserat View Post
Wow - the names of those companies/product offering that increased their fees - I've never even heard of them.

Short story - early on in my investing career, I went to a broker, a friend, and she recommended this fund. I was naive so had her start a monthly deduction for allocation to this fund. A year or two later I started educating myself about investing and when I looked at this fund, I was aghast at how much was a fee to her on a monthly basis as well as the expense ratio to the company - yikes - I got out of that fast, however, I did lose a bit of my money in the process. And I wasn't making a whole lot then....amazing how much of a cut the middle man can take.
You would be amazed at how LITTLe the rep really gets. Maybe I'll break it down sometime, not that anyone would believe the facts anyways..........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)


This Thread is USELESS without pics.........:)
FinanceDude is offline   Reply With Quote
Old 04-23-2010, 06:24 PM   #6
Thinks s/he gets paid by the post
Onward's Avatar
 
Join Date: Jul 2009
Posts: 1,667
Quote:
Originally Posted by chinaco View Post
VG!
Last I heard, VG had no intl bond fund. Has something changed?
__________________
And if I claim to be a wise man, it surely means that I don't know.
Onward is offline   Reply With Quote
Old 04-24-2010, 09:36 AM   #7
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2007
Posts: 5,072
Quote:
Originally Posted by Onward View Post
Last I heard, VG had no intl bond fund. Has something changed?
It was direct to the OP about low cost.

Quote:
understand how much "costs matter" over the life of a mutual fund based portfolio
VG does have international bond funds. But they are not available in the US.

There is a debate (philosophy) as to whether average US investors should hold international bonds (if they intend to spend the money in the US) due to currency risk, laws in other countries, higher cost, etc.

If VG developed a foreign bond fund for US investor, I would hope it would be a no load/low cost blended world bond fund (including US bonds). That way the fund manager would have the flexibility of rebalancing assets for longer term currency rate difference.
__________________
chinaco is offline   Reply With Quote
Old 04-24-2010, 05:23 PM   #8
Thinks s/he gets paid by the post
 
Join Date: Mar 2009
Location: Pittsburgh, PA suburbs
Posts: 1,769
Yes the expenses of funds vs performance are a much overlooked area. Not by people on this board for the most part, but for the "average" less well-informed investor. I was solidly in the latter group until recently, but I am taking a good hard look at things and making changes as far as practical.
__________________
WhoDaresWins is offline   Reply With Quote
Old 04-25-2010, 11:02 AM   #9
Thinks s/he gets paid by the post
John Galt III's Avatar
 
Join Date: Oct 2008
Posts: 1,285
Note that funds can have different tiers which have different "hidden" fees. Example. I signed up for the 401K with my company, and had all my contributions going into Wells Fargo Stable Return N, earning x percent per year. After about 6 months, the WF website announced all monies from Wells Fargo Stable Return N were going to be moved into Wells Fargo Stable Return N4. I checked out the interest rate for the N4 version of this fund, and lo and behold, it was a half percent lower. Same "fee" quoted, I think, but interest rate a half percent lower, therefore I the investor, am taking the half percent hit. I called up WF about it, and they acted like everything was fine, it happens all the time, and agreed that yes, I was losing a half percent in the deal, but my company had agreed to ( or perhaps requested? ) the change. The original fund , earning a half percent more, still exists, but is no longer available to us 401k holders, at my company. Sort of a take it or leave it situation. Possibly a kickback / cost saving deal for my company. I still have money in WF Stable Return N4 since I don't like the alternatives in my 401k very much.
__________________
John Galt III is online now   Reply With Quote
Old 04-25-2010, 11:29 AM   #10
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by chinaco View Post
It was direct to the OP about low cost.

VG does have international bond funds. But they are not available in the US.

There is a debate (philosophy) as to whether average US investors should hold international bonds (if they intend to spend the money in the US) due to currency risk, laws in other countries, higher cost, etc.
I'm skeptical about the diversification and non-correlation benefits of foreign bonds myself. Unlike foreign stocks, where you can play changing economic conditions and hedge your bets on where the growth will be, foreign bonds don't seem to add much except for the currency play which you can already get in international stock funds.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 04-25-2010, 02:54 PM   #11
Thinks s/he gets paid by the post
Onward's Avatar
 
Join Date: Jul 2009
Posts: 1,667
Quote:
Originally Posted by ziggy29 View Post
I'm skeptical about the diversification and non-correlation benefits of foreign bonds myself.
I was the same until I read Work Less, Live More. Bob makes a good case for holding foreign bonds in a diversified portfolio. Don´t have the book here to flip through, though.
__________________
And if I claim to be a wise man, it surely means that I don't know.
Onward is offline   Reply With Quote
Old 04-25-2010, 02:57 PM   #12
Thinks s/he gets paid by the post
IndependentlyPoor's Avatar
 
Join Date: Jul 2009
Location: Austin
Posts: 1,142
Could somebody post the ticker symbols of foreign bond funds that have been around for a while? I would prefer funds that are not hedged if possible.
__________________
Start by admitting
from cradle to tomb
it isn't that long a stay.
IndependentlyPoor is offline   Reply With Quote
Old 04-25-2010, 03:16 PM   #13
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2007
Posts: 5,072
A pitch from Wells Fargo. It would be good to see a historical comparison of A vs B protfolio instead of "may and should" language.

https://www.wachovia.com/foundation/...004b0d1872RCRD
__________________

__________________
chinaco is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Diversified Mutual Fund ferco Stock Picking and Market Strategy 9 08-04-2008 09:25 PM
Mutual Fund Outflows.......... FinanceDude FIRE and Money 6 08-28-2006 02:32 PM
Lingo: Stock fund vs Mutual Fund Sam FIRE and Money 9 05-26-2006 11:44 AM
mutual fund ads Mysto FIRE and Money 1 04-10-2006 07:26 AM
Hedge fund-like mutual fund: SWHEX brewer12345 FIRE and Money 2 11-01-2005 02:29 PM

 

 
All times are GMT -6. The time now is 12:20 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.