FAGIX
FIDELITY CAPITAL & INCOME FUND FIDELITY CAPITAL & INCOME FUND
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A Portfolio I Found That Works For The Average Person
A Portfolio I Found That Works For The Average Person
Investment strategy for a 5-10 year goal. Thoughts?
Thoughts on this Breakout of Fidelity funds? - Goal is fairly aggressive growth
Thoughts on this Breakout of Fidelity funds? - Goal is fairly aggressive growth
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I am really interested in your post, but also a little confused on the details. If you wouldn't mind adding some clarification. >QQQI 13% Yield, ARDC 12%, SPAYI 11%, EIC 11%, PBDC 9%, UTF 7%, SCYB 7%, UTG 6.3%, PFFD 6% FAGIX 5%. * The above is only 50% of your portfolio, and the other 50% is in growth ETF not part of the list above? * Most important question: The 5K in monthly income you receive is based on what dollar amount invested in the above portfolio? * Those numbers add up to 87%. Where is the other 13%?
The solution to this cash reserve problem is not to use cash or growth index funds as a reserve for a market down turn. Instead consider investing your cash and taxa able brokerage holdings into dividend funds. For example if we take your 150K of cash and reinvested that for dividned. Now with 150K we cannot get enough cash to provide 9K a month. but with BTCI 25% yield you could get 3K a month of income Now normally I would recemond QQQI with its 13% yield due to my risk tolerance. BTCI is the maximum yield I would be comfortable with. But with your cash and taxable brokerage invested in BTCI you would bet very close to 9K a month. If you just use the cash in BTCI and reinvested all the money back into BTCI you will have 300K in BTCI and would have an income of 6K a month. If you don't need the money reinvest it in other funds to reduce single fund risk. or you could use the money to pay off a home loan or any debt you have. Reducing your living expenses. The key things to remember about dividneds is that the money is from the companies profits. And ever in 2008 and the dot. crash most companes were still profitable and still payed their dividends. I retired at 55 and I invested in QQQI 13% Yield, ARDC 12%, SPAYI 11%, EIC 11%, PBDC 9%, UTF 7%, SCYB 7%, UTG 6.3%, PFFD 6% FAGIX 5%. A mix high yield and lowe less risky yields And I still have 50% of my portfolio in growth index funds. My living expenses are about 4K and I currently get 5k from dividends so 80% of my income covers my living expenses with the remaining 20% being reinvested for more income. Now if there is a correction in the market most of my dividend income will continue. But if not I can sells some growth for additional income. A good book to read is the income factory. And armchair income on you tube invests the same way but does good reviews of funds that can be used for income.
Target date funds gradually sift their investments from mostly growth to income over time. So when you retire you have enough income to cover living expenses with enough growth so that you can maintain that income over time. Ideally you want more income than you need in retirement with enough growth to insure you never run out of money. Target date funds as a result of their investment stratagy are actively managed. Most growth index funds are passively managed. Meaning more people are needed to select the income investments and trim investments that don't work out. More people means more expenses. 0.75 is actually normal for actively managed funds. while 0.3 or less is about normal for passively managed growth index funds. But if you want you could do it yours with say 50% growth index funds with the remainder invested for income from dividend funds. Many focus on bonds but the yield is often too low for that to work well. Bonds barely keep up with inflation. But excluding government bonds you can get much higher yields. 9%, UTF 7%, UTG 7%, SCYB 7%, PFFD 6%. And I do have FAGIX a bond dung that earns 5%. But the bulk of my earnings comes from yields greater than 6% With an average yield slower to 9%. My current income is about 5K a month.
Yes. Dividend equally in FAGIX. FDGFX FGRTX. FMAGX. FNILX. FULVX I own all and have nice gains. You will too. Buy and forget
The problem iwht bogleheads investing is you have to liquidate stock to generate income. Which means you could eventually run out of money. The solution to the problem that preserves captial is outlined in the Book The income factory. And Armchair income on youtube also discusses this. There are funds and company stocks that pay out a portion of their profits to you quarterly or monthly as cash to you. Say you invested 100K in a fund with 10% dividend yield of 10% and it pays monthly. Every month you will,$833. Dollars a month. while you are working you invest the money back into the fund. The fund will grow. in 7 years the fund will have about 200K deposited and will pay a dividend of 1,666 every moth. Over 30 years you should also have about 1 million in ht account producing about 10K a month of incomce. If you invest for dividends in addition to your growth index funds you should have substantial income when you retire. So you live off of the dividned income . IF you don't spend all of the income you reinvest the excess money. Hopefully you can reinvest enough to keep up with inflation. IF you have a bit unexpected expense in retirement you can sell the growth funds to generate the additionally income needed. Or you could periodically harvest 4% of the growth and reinvest the money for more dividend income to adjust for inflation. I retired and now get 5K a monty of income from dividends 4K covers my living expenses. and 1K a moat is reinvested. I also have growth funds I can tap if needed. It is working out very well. Some of the funds I am investing in for income are FAGIX 5% yield, PFFD 6%, UTG 6.7%, UTF 7%, SCYB7%, PBDC 9%, SPYI 11%, ARDC 12%, QQQI 13%.
government bonds, CD, and money market funds all have low yields. given the limited funds most people have in there retiement account it would be best to get the highest safe yield you can get. Preferably you want enough income from your investments to cover all of your living expenses. With enough passive income you would not be required to liquidate your saving using the 4% rule and your retirment fund will last longer. If you invest for dividends you can easily get a higher yield with little to no additional risk. If you invest your money in funds like FAGIX 5%yeild, PFF 6%, SCYB 7%, PBDC 9%, SPYI 11%, ARDC 12% you can easily get a higher yield. I you put an equal ammount of money in each fund I listed you could get combined yield of 8%. For every 100K invest you would get 8K a year of income. I have been doing this for the last few years and currently have a projected income of 60K a year. Enough to cover al of my living expense. And the thing that yould surmise a lot of people is that all of the bad news hitting the market this year has not had any impact on my income. Yes the value of my portfolio is down a lot but the income is continuing to come in. My income has not dropped. Investing for dividends significantly reduces my concerns about the lower share prices. I am now paying more attention to my income. This invetemtn strategy is listed in the book the Income Factory. And the book list 68 funds the author has used for his personal account and accounts he has managed forfriends. The you tube channel Armchair investor also does this and he post his list and discusses how choses the funds he he invests in for his personal retirment acount. These have a lot of information you can use to develop your own regiment portfolio.
but there are two ways for many to grow: Price appreciation. (Capital gains) Dividend income. As the last week has shown is that price pareciation can vanish quickly and it may take years for that to recover. in 2000 a bear market started and it tool 14 year for the S&P500 to recover all of its losses. Most people today are invested in index funds which mainly growth through price appreciation. Indes funds do pay a dividend but it is small about 1% and insignificant to most investors. The other mechanism is dividned income. May companes return a portion of their profit to shareholders by a cash payment known as a dividend. Bond pay interest. If you reinvest he dividend or interest from your investments are reinvest that into the asset that gene3rated it you portfolio will grow. Dividend payments are determine by last years profits. So current events mot of the time will no effect the dividned Payment. Current events may have an effect of dividend payments in a year or two. Especially if a company is seeing lower profits. Historically during bear markets the mean average dividned reduction is about 2% Not tbe nearly 20% capital gain loss we have seen in the last week. What I have been doing for some for about 5 years is creating a passive income portfolio by investing for dividneds I now have 4K a month of dividend income. The have been no dividend cuts since I reached 4 K a month.I used mainly assets that payed a dividned of 5% or higher. To my surprise I found quite a few stable yield up to about 10'5 or a little higher. Everything this year has has not bothered me because I have stable income. Some of the funds That have that have worked well are FAGIX 5% yield, PFF 6%, PBDC 9%, SCYB 7% and SPYI !!%. The higher the yield the less money you need to invest to get the desired income. To get eh same income from a S&P500 index fund with a yield of 1.3% But you would need need to invest 4 to 5 times more money that you would need with a higher yield fund.
I don't know what I'm down by, but I have a fair amount in USFR for times like these, and it buffers a lot of the drops. Its a buying opportunity and I'm debating on if I want to start drawing down cash or wait longer. 4.x% makes that decision hard when I'm on the fence. I did sell out of my FAGIX positions the other day for a nice 15% gain (+ payouts) and roll it into QQQ and NVDA. Google is looking more attractive - I already have 200 shares at 165, but could more hurt?
Index fund a good general performers best suited for retirement accounts. They are not so good for taxable accounts. The index fund has a mix of growth and stable companies. As a result its dividend is greatly reduced and any growth it has is less than you would get with growth specific fund. For a taxable account you want to focus on dividend income. Enough to cover your living expenses. That way if you loose your job you will have long term passive income to caryry you through until you get a new job. have 6 months of case on hand for short term emergencies. These two portions the taxable account will help stabilize your life. These will generate taxes which you need to manage not avoid. people go crazy finding ways to avoid dividend taxes. This can lead to investment strategies that are more safe then useful. you also need a long term savings preferably with minimal tax. if you invest in growth stock that don't pay a dividen you won' pay tax on the savings. And since they are growth stock you savings will grow over time. For example if you invested in TESLA 6 years ago your initial investment wouldn't abbe been very large but today it would be worth 22 times your initial investment. Any would have paid zero tax during those 6 years. You can also use index funds. the low dividend would minimize taxes. But you get less growth. over teh last 6 year the S&P500 index has only doubled. A lot less growth than TSLY. a much getter choice is SCHG or QQQ. SCHG is 3 times larger thanks was 6 years ago QQQ is 6 times larger. And SCHD and QQQ have a dividend of about 0.5% while the S&P500 is 1.3%. If you use your taxable account this way you will have long term passive income, and emergency fund, and enough long term savings you can liquidate if needed to an expense that your dividend or emergency fund can handle. you won't get that with just he S&P500. Good dividend funds for you could use passive income are SCHD, SCHY, PBDC, SPYI, FUTY, FAGIX
You could use the 75 dollar to buy at least 2 shares of the following companies and get a higher yield than you were likely getting at the banks: 4.65% yield T (AT&T), $23 a hare 4.6%yield ARCC $22, 8.64% PFFD $20, 6% SCHD 28% 3.31% FAGIX $10, 5% There are little hundreds of low cost dividend funds with a decent yield that is has as good or higher yield US than US bonds or bank interest.
If you shift 1 million of your 401K to dividend funds you could avoid the effects market downfalls1 million in paffD which has a dividend yield of 5% would provide 50K of income you can use to cover living expenses without having to sell shares of stock. IF you use JEPQ with a yield of 10% you would get $100K a year of income. The rest of the 3 million could be left were it is and the if there is a market correction you jet let it ride through. Dividned income is largely unaffected by market crashes. [ The dividend income may drop by 2% but then recover.](https://www.reddit.com/r/dividendgang/comments/18q1vjj/debunking_the_myth_of_dividend_cut_during/) Index funds on the other hand can 30% or more very quickly and then it may take a year or more to recover. In my retirement account I and adding these dividend ETFs, JEPQ,PBDC, FAGIX, VYMI, SCHD,PFFD.. using dividend income would largely elevate your wife's concern and one set up you wouldn't have to do anything more. And you could avoid the advisor fees. As to rolling over your 401K into a roth keep in imd you likely would have to pay taxes on the rollover amount which will be substantial . You should consider the tax impact carefully before making a decision.
The answer to your problem is to invest Differently than you are now. VTSAX is best at earning capital gains. Meaning the price per share increases over time. What you need now is cash. Meaning you need to invest for dividends. Dividends is portion of a companies profit that is returned to shareholder as a cash deposit into your brokerage account. Most companies pay a dividend 4 times a year. For example if you moved all of your savings int PBDC you would earn a field of 9% on your money. That is $8370 year. of income. which is $697 a month Now right now you cannot do this because you need your savings for current living expenses. But when earnings season starts for you invest as much as you can in dividend ETF or stocks that pay a dividend. So gradually over time build up your dividend income to generate enough income to cover all of your living expenses. And when the dividend arrives put the money into your savings or reinvest it for more income. For VTSAX if it is in a tax deferred retirement account leave it alone. But if it is in a Tax able account you can use the money in it generate the income you need. Technically VTSAX does produce a 1.3% dividend. But that is probably not enough to meaningfully help with living expenses. Also it is best to invest in wide veriety of dividend stocks to produce a diversified passive income stream. There are many more than the one I mentioned above . You want about 10 sources of dividend income with each producing an equal portion of the income you need. that way if one goes bad and fails to pay you loose lonely 10% of your income.Don't put it all on one fund. Funds that I currently have in my account arej JEPQ, PBDC, PFFD, SCHD, FAGIX, VYMI, FUTY,FTXG. I CURRENTLY HAVE $50K a year of passive income. Enough to cover my basic living expenses
I would invest the money for two purposes. Invest for passive income, and build a savings for emergency cash needs. The passive income is to provide enough money to cover all of your living expenses (Food, Clothing, housing, utilities, Medical insurance, and taxes). . That means investing in stock and bonds for a steady stream of income. That way if the buisness has a couple of bad years you still have money for living expenses . Eventually you could be able to separate your finances from the companies expenses . You will pay taxes on the dividend income I use These ETFs for this purpose. SCHD, VYMI, Pffd, FAGIX, JEPQ, and PBDC. For savings buy growth stocks that don't pay a dividend. These will not generate any tex until you sell them. You could also invest in ETFs that pay a minimal dividend like SCHG. A growth fund that has a di ivdend of 0.5%. I you are ok with slightly higher dividend you could add some low cost index fund, like BVOO or VTI. This way you could eventually have several years worth of income saved up in low tax invesmts. Additionally you could have 1/2 a year of cash on hand that could ba accessed in a day or less with a debit card. This money could be used to rebuild the business should it be destroyed by fire or some sort of natural disaster.
Sounds good! Fidelity has some nice zero-fee index mutual funds, those are a darn good bet - FZROX, FNILX, etc. Fidelity also has some good actively managed funds, like FBALX, FCNTX, and FAGIX - but nowadays the trend seems to be to go for the free ones!
over the last 20 an investment inn stocks has performed better than investing in pressure metals. ˆv you sang go cd dfxivy it is better to add some bonds and dividend stocks. FAGIX and SCHD are two I would consider. You could post most of your money in VTSAX and maybe 30% into the two I have mentioned. After putting as much as you can in the retirement account. start an emergency fund in a taxable account. this could be like to 20 to 30K of cash in a high yeild savings account with the remainder in a growth ETF with minimal dividends. Such as VO0. If you have an unplanned expense or loose your job you will have the cash for immediate needs. plus he shares of VOO that can be sold for more cash if needed. Having limited cash and mostly low dividend stock in the emergency account will help minimize taxes in the taxable account. But you would have quick access to sash if needed.
FAGIX is another Fidelity Bond ETF you could consider
Great advice on reinvesting dividends, FAGIX sounds like a solid addition. How often do you reassess your portfolio?
the dividends from each rund can be automatically reinvested in the fund. Go to the summary page of your account and then select more and then select account feartures and then under Dividends and Capital Gains. select manage. So any you receives from the fund can be placed into a cash account or be reinvested into the fund. I would select rein vest for all your funds. I would suggest adding FAGIX to your portfolio. At the end of each yearrepballance so all funds have the same amount of money in them, That means sell the ones that gain the most and put that money in the fund or funds with the least gain in bull markets the reballan ce would put more money in FAGIX. In her markets money from FAGIX would go into the other funds. Then when you retire FAGIX would provide you with income to cover living expenses.
I'm saving toward a downpayment on a first home purchase with a 2-3 horizon. About 25% of my portfolio is in bond funds (FAGIX and FFRHX), which are paying better than CDs and seem to have a good shot at capital appreciation given looming rate cuts.
My thoughts. First, I don't think these are good reasons to be overly defensive. 1. There have always been international conflicts, and the powers driving the current ones, Russia and Iran, are both extraordinarily weak regimes which would likely crumble if aggressively confronted militarily, which won't fully happen anyway given the current state of leadership in the West. Bottom line, there isn't much unusual here, conflict in the ME has been going on for over a century, nothing has changed much, and nothing will. 2. The election will be over in 3 months, and the outcome won't matter much anyway, given how little power a U.S. president actually has, and how small the shifts in legislative power, one way or the other, typically are in U.S. elections. Most of what happens *after* the election is just more certainty, and for that reason election years have historically been good for stocks, especially Nov, Dec, Jan, Feb. 3. There are always recession possibilities, and at the moment, if anything, they seem to be lower than normal. GDPNow is still projecting 2% real for Q3, and the last Fed rate hike was more than a year ago, so no reason to expect any significant lagged effects at this point. Plus inflation seems to be already just about defeated, the Fed able to begin cutting if needed, and nominal GDP growth likely to come in at a sustainable rate for Q3 (somewhere ~4.5%). Apart from some slight weakening in labor markets, the data is basically screaming "soft landing" at the moment. 4. Russia is losing in Ukraine. They can't afford to expand this conflict. Ukraine expanding it, into Russia, should be seen as bullish. 5. The Yen carry trade normally involves mainly short term trades, and isn't an especially high yield strategy (5-6% annual returns). The losses there were due to a sudden appreciation of the yen. I think this was a one-time thing, in response to one surprise move from Japan's central bank, and that Japan's economy isn't strong enough right now (relative to the U.S.) to expect much continued longer term appreciation of the yen relative to the dollar. That all said, if you are < 4 years from retirement, it would make some sense to reduce your stocks to around 60% of your portfolio now, anyway. But I really wouldn't go below half. And in terms of diversifying your risk, beware that one of the biggest risks would be a resurgence of inflation, which tends to be bad for *both* equities and bonds, so there is some significant correlated risk there. For that reason, I prefer inflation protected bonds play a significant role in a balanced portfolio. On top of which, with the 5-year breakeven rate under 2% right now, I'd take the over if I'm betting on what inflation will be, so I think TIPS are probably the slightly better investment now anyway. If you are a US citizen, I think one of your best options for your safer bond investments is to open an account with the US treasury at treasurydirect.gov. You can buy bonds directly there, but also can buy up to $10k in Series I Savings bonds, which currently pay 4.28%, but will adjust with inflation, and will basically pay 1.3% over CPI inflation for as long as you hold them. There's a small penalty (3 mos. interest) if you hold them less than 5 years, so don't put your short term funds here. But put $10k yearly into these until you have enough of a buffer that you won't have to touch your stocks within 10 years. As for Funds, I can recommend also putting some into Fidelity's Capital and Income Fund (FAGIX). That fund is about 20% equities, but is mostly a bond fund, and is a pretty solid fit in a retirement portfolio (less aggressive than your equities, more aggressive than most of your bonds). For shorter term funds you might need within the next 5 years, I think Money Markets are still the best bet. I don't think rates will be cut as much as some expect. I think they'll stay over 4% for the next couple of years, so long as fiscal deficits continue to remain high.
fire your advisor. just buy VTI, SPY, QQQ, and FAGIX. do like, 30, 30, 30, 10%.
Etfs, bonds, mutual funds... Here are my favs: JEPI JEPQ TLTW FAGIX PDI LTC OXLC ARCC KBWD HYT I believe these are all monthly. There are more but I'm tired. Have fun!
Yup, I hold FAGIX but otherwise I invest in individual bonds.
In my Roth IRA, I buy into FAGIX and FFRHX. They give out monthly dividends unlike most mutual funds. Maybe not much but they buy into bonds and bank loans more than just other stocks. And some MBS’s along with them like ARR and AGNC. I’m going to be buying into other MBS’s and a few dividend aristocrats as well eventually, but for now I’m working on them.
> I found more users saying to invest in them later in life and that my goal right now should be targeted towards obtaining as much growth as possible. this line of reasoning is based on the assumption: "stocks for growth until close to retirement, then emphasize bonds for stability" the reality is "stocks for growth until close to retirement" is a form of market timing. the reality is bonds can outperform stocks for years at a time, stocks are not always the best performing asset class over long periods, and there's a place for bonds in every portfolio. reddit skews very young, and hasn't experienced a period where bonds beat stocks for several years. when it happens again, there will be widespread shock and consternation, weeping and wailing and gnashing of teeth, dogs and cats living together, mass hysteria. but if you've got even a bit in bonds, you gain some of the upside. - in 2000, 2001 and 2002 bonds beat the S&P 500 by over 20% each year. https://www.thebalancemoney.com/stocks-and-bonds-calendar-year-performance-417028 - bonds beat the S&P 500 from 2000 to 2020. https://www.nytimes.com/2020/05/01/business/bonds-beat-stocks-over-20-years.html - long-term US treasury bonds beat the US market 1981-2011, and 1968-2008. https://www.cbsnews.com/news/bonds-beat-stocks-over-30-years-so-what/ - three high-yield bond funds performed about as well as the US stock market over the long-term. VWEHX from Vanguard had a cumulative annualized return of 7.74% from 1978 inception. https://investor.vanguard.com/investment-products/mutual-funds/profile/vwehx#performance-fees FAGIX from Fidelity has a 9% annual average since 1977. https://fundresearch.fidelity.com/mutual-funds/performance-and-risk/316062108 EDIT SPHIX from Fidelity has averaged 7.5%/yr since 1999. https://fundresearch.fidelity.com/mutual-funds/performance-and-risk/316146406 - Jack Bogle of Vanguard recommended a *minimum* 20% bond allocation for all investors. “...why would an intelligent investor hold any bonds at all? First, because the long run is a series of short runs, and during many short periods, bonds have provided higher returns than stocks. In the 117 years since 1900, bonds have outpaced stocks in 42 years [37.5% of the time]; in the 112 five-year periods, bonds have outpaced stocks 29 times [25.9% of the time]; and even in the 103 fifteen-year periods, bonds have outpaced stocks 13 times. [12.6% of the time]”. from the 2017 edition of his book *The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns* numbers in [square brackets] are my calculations.
I typed this up for another question, so here's why everyone should consider bonds: reddit skews very young, and hasn't experienced a period where bonds beat stocks for several years. when it happens again, there will be widespread shock and consternation, weeping and wailing and gnashing of teeth, dogs and cats living together, mass hysteria. but if you've got even a bit in bonds, you gain some of the upside. - in 2000, 2001 and 2002 bonds beat the S&P 500 by over 20% each year. https://www.thebalancemoney.com/stocks-and-bonds-calendar-year-performance-417028 - bonds beat the S&P 500 from 2000 to 2020. https://www.nytimes.com/2020/05/01/business/bonds-beat-stocks-over-20-years.html - long-term US treasury bonds beat the US market 1981-2011, and 1968-2008. https://www.cbsnews.com/news/bonds-beat-stocks-over-30-years-so-what/ - three high-yield bond funds performed about as well as the US stock market over the long-term. VWEHX from Vanguard had a cumulative annualized return of 7.74% from 1978 inception. https://investor.vanguard.com/investment-products/mutual-funds/profile/vwehx#performance-fees FAGIX from Fidelity has a 9% annual average since 1977. https://fundresearch.fidelity.com/mutual-funds/performance-and-risk/316062108 EDIT SPHIX from Fidelity has averaged 7.5%/yr since 1999. https://fundresearch.fidelity.com/mutual-funds/performance-and-risk/316146406 - Jack Bogle of Vanguard recommended a *minimum* 20% bond allocation for all investors. “...why would an intelligent investor hold any bonds at all? First, because the long run is a series of short runs, and during many short periods, bonds have provided higher returns than stocks. In the 117 years since 1900, bonds have outpaced stocks in 42 years [37.5% of the time]; in the 112 five-year periods, bonds have outpaced stocks 29 times [25.9% of the time]; and even in the 103 fifteen-year periods, bonds have outpaced stocks 13 times. [12.6% of the time]”. *The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns* numbers in [square brackets] are my calculations.
>I wouldn't envision a long-term portfolio holding bonds until about 10 years closing in on the horizon. your assumptions are flawed. your assumption is "stocks for growth until close to retirement, then emphasize bonds for stability" the reality is "stocks for growth until close to retirement" is a form of market timing. the reality bonds can outperform stocks for years at a time, stocks are not always the best performing asset class over long periods, and there's a place for bonds in every portfolio. reddit skews very young, and hasn't experienced a period where bonds beat stocks for several years. when it happens again, there will be widespread shock and consternation, weeping and wailing and gnashing of teeth, dogs and cats living together, mass hysteria. but if you've got even a bit in bonds, you gain some of the upside. - in 2000, 2001 and 2002 bonds beat the S&P 500 by over 20% each year. https://www.thebalancemoney.com/stocks-and-bonds-calendar-year-performance-417028 - bonds beat the S&P 500 from 2000 to 2020. https://www.nytimes.com/2020/05/01/business/bonds-beat-stocks-over-20-years.html - long-term US treasury bonds beat the US market 1981-2011, and 1968-2008. https://www.cbsnews.com/news/bonds-beat-stocks-over-30-years-so-what/ - two high-yield bond funds performed about as well as the US stock market over the long-term. VWEHX from Vanguard had a cumulative annualized return of 7.74% from 1978 inception. https://investor.vanguard.com/investment-products/mutual-funds/profile/vwehx#performance-fees FAGIX from Fidelity has a 9% annual average since 1977. https://fundresearch.fidelity.com/mutual-funds/performance-and-risk/316062108 - Jack Bogle of Vanguard recommended a *minimum* 20% bond allocation for all investors. “...why would an intelligent investor hold any bonds at all? First, because the long run is a series of short runs, and during many short periods, bonds have provided higher returns than stocks. In the 117 years since 1900, bonds have outpaced stocks in 42 years [37.5% of the time]; in the 112 five-year periods, bonds have outpaced stocks 29 times [25.9% of the time]; and even in the 103 fifteen-year periods, bonds have outpaced stocks 13 times. [12.6% of the time]”. *The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns* numbers in [square brackets] are my calculations.
>nothing has outperformed the S&P 500. plenty of things have outperformed the S&P 500, depending on the period of time. the S&P 400 (mid cap) and S&P 600 (small cap) both beat the S&P 500 from about 1995-2016. https://external-content.duckduckgo.com/iu/?u=https%3A%2F%2Fcontrarianoutlook.com%2Fwp-content%2Fuploads%2F2016%2F11%2F20yr-SPY-SmallCaps-MidCaps-Chart.png&f=1&nofb=1&ipt=d748287931786149a4345c1f394c064608a8df08c7ce9a9d5441711c7727efad&ipo=images bonds beat the S&P 500, 2000-2020. https://www.nytimes.com/2020/05/01/business/bonds-beat-stocks-over-20-years.html DODGX beat the S&P 500 1990-2020, with total returns of 2555% vs. 1589%, see the purple line on the top chart: https://imgur.com/a/SQmcQkz DODGX also beat the S&P 500 2012-2022 by over 1%/year, and 2002-2022 it underperformed the S&P by only 13 basis points. https://www.dodgeandcox.com/content/dam/dc/us/en/pdf/fact-sheets/Dodge_Cox_Stock_Fund_Fact_Sheet_I.pdf DODGX beat the S&P 500 from 1985-2023, as far back as the data goes on Portfolio Visualizer. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=1985&firstMonth=1&endYear=2023&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&reinvestDividends=true&showYield=false&showFactors=false&factorModel=3&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&symbol1=VFINX&allocation1_1=100&symbol2=DODGX&allocation2_2=100 DODGX goes back to the 1960s, so I wouldn't be surprised if it's beaten the S&P 500 since inception. NAESX (Vanguard Small cap fund) and FAGIX (Fidelity high-yield bond funds) both beat the S&P 500 from 1999-2023. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=1999&firstMonth=1&endYear=2023&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&reinvestDividends=true&showYield=false&showFactors=false&factorModel=3&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&symbol1=VFINX&allocation1_1=100&symbol2=FAGIX&allocation2_2=100&symbol3=NAESX&allocation3_3=100 the Templeton Growth Fund TELPX beat the S&P 500 from 1985-2005. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=1985&firstMonth=1&endYear=2005&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&reinvestDividends=true&showYield=false&showFactors=false&factorModel=3&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&symbol1=VFINX&allocation1_1=100&symbol2=TEPLX&allocation2_2=100 it's really not hard to find things that beat the S&P 500 over long periods. I keep reminding younger investors that the S&P 500 is not magical.
Just saw fidelity fixed income index ticker for the first time. It is FAGIX Surprised more people on here don't buy in
>Since 2010 the S&P 500 has beaten cash and bonds pretty handily. that chart used a vanguard total bond index. for kicks I replaced it with FAGIX, a high-yield bond from Fidelity and it beat the market 2000-2020. https://www.portfoliovisualizer.com/backtest-portfolio#analysisResults much depends on which period of time we examine....
FAGIX is an oddball fund, ~80% high-yield bonds and the rest in stocks. it's more volatile than something like FSHBX, a short-term bond fund, it's good for what it is. semi-conductors are too trendy for me, and past returns don't necessarily tell you anything about future returns. that particular fund has a p/e ratio of ~25, which is a bit too highly valued for me. the top holding is 27% of Nvidia!!!, which is crazy level of concentration and Nvidia is already a top holding in the total market index. https://fundresearch.fidelity.com/mutual-funds/composition/316390863?type=o-NavBar that fund has also been highly volatile, it dropped 50% in 2002 and again in 2008. https://finance.yahoo.com/quote/FSELX/performance?p=FSELX also, 4% of a portfolio will not have much impact.
I don’t bet on individual stocks because the amount of research I’d need to create a portfolio of companies that perform better than the S&P 500 would be astronomical. But I do have 3 different funds that I’ve invested in, and some are riskier and pose a higher return than the standard. I have the majority of my money in a money market fund and FSKAX (Fidelity’s total market fund that matches S&P 500) and this is my bedrock. Over 80% of my invested money will be in these two, and that’s why I’m able to sleep well at night. Then I have invested some money on FSELX, which is Fidelity’s select semiconductor fund. It’s composed of several American and Taiwanese semiconductor and hardware manufacturers. It’s performed well and my theory is that it will continue to perform well thanks to the US government investing a large amount of money of manufacturing semiconductors domestically. This is, however, a risky investment and it has a higher beta. I hope to make money with it but I’m also prepared to lose money in the short term. I also invested in FAGIX, which is a high yield bond fund that’s composed of bonds from companies with junk grade credit. This is my riskiest investment and I have less than $100 on it at the moment. I wouldn’t go riskier than this, personally. I’m young, so I have some room to play dice. But I’ve found that there’s a variety of ETFs and mutual funds that cover a wide variety of industries. With this being offered, I don’t think that investing in single companies and making your own portfolio is worth it. It’s too much work, and you could just enjoy your summer instead of potentially flushing down your money.
Check into Brokeragelink. FAGIX is my favorite fund in Fidelity. Pays dividends monthly and July and December usually get some good extras.
28 y/o, pretty risk averse and would love some brutally honest feedback. More of a "set it and forget it" kind of person, but I want to make sure I'm on the right track. FXAIX - 50% FSMDX - 16% FSPSX - 16% AAPL - 7% FAGIX - 4% IEMG - 2% FECGX - 2% BB - 1% CRLBF - .2%
I personally would go with all Vanguard or Fidelity ETFs and try to keep your expenses under .1 percent, not 1 percent, but 1/10th of a percent. Your FAGIX has .67%. VOO is good. The reason I say is focus on expenses is because saving on expenses is the same as getting extra returns and ETFs all return about the same (within their particular sector). An extra 1/2 percent over 30+ years is many thousands of dollars. Maybe VOO, VOE, and VB. That would give you most of the market. If you are in your 50s/60s, add a bond fund or keep 10-20% in a money market. Best of luck.
40% VOO 20% QQQ 20% SCHD 10% FAGIX 10% JEPI New to investing this is in my IRA account. Any advice helps!
Great question. Federal Government bonds are easy to buy via Treasury Direct. Buying/researching Corporates and other government debt can feel cumbersome relative to buying stocks. I do bond mutual funds and ETFs like FAGIX and HYG. A lot of people under 45 have neglected bonds because interest rates have been low for so long. The lower volatility and steady income is appealing.
Hello everyone. I would like some insight on my current investment strategy for my Roth IRA via Fidelity. Specifically, I am asking for any red flags or improvements I can make with my portfolio. My goal is maximize returns with a retirement date of 2065 in mind. FYI, I’m a 22 yo F, married filing jointly, opened the account in 2021 with $200 but maxed out contributions this year. I’m planning on maxing out contributions every year from here on out. Currently sitting on $6.4k in this account. I have other tax-disadvantaged accounts but I specifically want advice for this one. Here’s a breakdown of my portfolio with percent allocation, Morning Star fund categorization, name of fund, and my reason for investing organized in order and separated by hyphens. * 67% - Target date fund (2065+) - FFIJX - I wanted to be lazy with my investment strategy. * ~13% - Large Blend - FNILX - I thought I should take advantage of the zero expense ratio of this fund and have a fund specifically dedicated towards tracking the S&P 500. Since the target date fund automatically reallocates its portfolio in later years, I wanted to be secure and own a large blend fund on my own dime. Literally. Also, I can tolerate volatility and risk considering my age. * ~10% - Large Value - FDGFX, FEQTX, FGRIX - I did want to be lazy but I thought maybe I should also try to maximize dividend income and capital appreciation. I came to the conclusion from my haphazard research that value funds have higher dividend and capital appreciate rates compared to blue chip stocks? Please correct me if I’m wrong. * ~ 5% - High Yield Bond - FAGIX - I wanted some assets in a bond but considering my age, I wanted a bond that offers higher returns with more risk. * ~ 2% - Money Market - SPAXX - I have some cash that I could invest but all of my assets are up right now and I don’t want to invest the remaining money ($300) until the recession hits and the cost of the funds come back down. Yes, I’m aware of dollar-cost-averaging. However, I thought this move was fine because I can still accrue some interest, although minimal (3.4%), and the recession is (unfortunately??) looking guaranteed. * <2% - Digital Assets - BITQ - My biggest regret purchase yet. I’m stuck in Sunk Cost Fallacy mode and am currently trying to hold long enough to at least break even before ridding my hands of crypto for good, at least in my Roth. So, this is it. In summary, I have 7 index funds in my Roth IRA portfolio with emphasis primarily on a target date fund with a large cap fund, some large value funds, bonds, and digital assets tacked on to maximize returns. The split between target-date and other funds is 70-30. I’m willing to adjust this split. Currently, my gains range from 2.58% - 12.97% with my only loss being from BITQ (-21.96%). Expense ratio is on the lower side for all, I think, ranging from 0.0% - 0.58%. I appreciate any and all advice. Thank you.
> FAGIX, FAGIX fell to 7.59 in 2020. Nothing is certain.
Thank you again. I envision myself making conservative, reliable trades based on a firm grasp of the fundamentals. So no WSB nonsense. I also keep a keen eye on FAGIX, which allows you to get reliable income of 3.5% for the rest of your life, with no work at all. So I feel that if I can narrow my window between 5% and 30%, at least this helps me to set some expectations and assign money correctly. Obviously 50% would be top tier level performance, achievable by a small minority of people? As you can see, I am in the planning stages here. I want to sell my engineering practice and cash out of the high stress work that I do right now. To answer the golf question, I think that I would ask a similar question. I know that I'll never be Tiger Woods, but I also think that a 40 year old who's working hard at something can achieve a reasonable benchmark. I'd ask a personal trainer what that could be! This way, it helps to bracket some numbers and set expectations.
FAGIX pretty good too. Use it and REIT fund for yield but yeah not supposed to mention that shit on here.
don't buy options, buy SPY or QQQ or just go all in on bonds (FAGIX for sure) and wait 2-3 years.