Favorite Mutual Funds

**jIM_Ohio** · 12-29-2009, 09:07 AM

PRFDX T Rowe Price Equity Income
PRPFX Permanent Portfolio

**ea1776** · 12-29-2009, 09:16 AM

MCHFX
Matthews China
Link to Chart

Reason:

I am a believer in the China Growth Story and think over the long run it will outperform all other markets due to size of emerging middle class, savings rate there, and the acceleration of innovation going on in China. Not to mention that there government doesn't habitually overspend like, uh-hum some other governments I know!

This fund has a great performance track record, good management (Matthews sends out an excellent free "postcard" weekly if you subscribe on their website), and sports a 5-star Morningstar rating. It is no-load, has a 1.23% expense ratio, and I don't pay any transaction fees through my broker when I purchase it in increments of $1k.

But the main reason I like this fund is because of its focus. It focuses on domestic consumption in China, which I believe will be the major growth driver there. An index fund in China may give you exposure to the country (which should be essential in ALL portfolios IMHO), but I believe it's smarter to go with a managed fund; with managers who understand the culture there and what is really driving growth.

The fund also gives out a (at least historically) rather juicy dividend for a growth-focused fund (not that big this year, but in previous years it has been off and on really good).

Risk - The main risk of investing in China IMHO is government policy. They are still communist and the government can do whatever it wants on a dime. This is kind of a double edged sword, as we saw how effective/fast the (Chinese gov't sponsored) stimulus worked. One example of "bad gov't intervention" is how the gov't is "protecting" its citizens from violent content in video games. This kind of censorship "spoiled the party" in a way for awesome growth companies like Shanda Interactive, Netease, ChangYou, Perfect World, etc. One positive though is that the government seems to be committed to growth and infrastructure. I don't believe therefore that the government would do anything so drastic that it would send this particular diversified fund down the tubes overnight or even over the course of several years.

Disclaimer: As always, please don't invest in anything before you do your own homework, or at the very least get a blessing from the experts on this MB!

**ea1776** · 12-29-2009, 09:24 AM

Originally posted by jIM_Ohio View Post

PRFDX T Rowe Price Equity Income
PRPFX Permanent Portfolio

I like the holdings of PRFDX. I didn't see dividends being distributed on the google chart, which seems weird. With the lack of price movement on a long term chart, it would seem that you would be receiving a juicy yield and doing a D.R.I.P. I'd like to know about the dividend history of this fund.

From the beginning of 2000 to the present, it has returned -15% not counting dividends, so I'd like to see how re-invested dividends have caused the fund to really perform.

By the way, I'm a huge believer in DRIPS, especially in tax-defered accounts. I have about 20% of my portfolio in MACSX for that reason. I also like any fund that track a Dividend Achievers Index, since it will have a very low expense ratio and tracks high yielders with long histories of growing dividends. DHS is a good ETF that has a 0.38% expense ratio and a 3.92% annual dividend yield currently. Of course there are many others that are possibly even better or more risk-adverse.

**jIM_Ohio** · 12-29-2009, 09:30 AM

Originally posted by ea1776 View Post

I like the holdings of PRFDX. I didn't see dividends being distributed on the google chart, which seems weird. With the lack of price movement on a long term chart, it would seem that you would be receiving a juicy yield and doing a D.R.I.P. I'd like to know about the dividend history of this fund.

From the beginning of 2000 to the present, it has returned -15% not counting dividends, so I'd like to see how re-invested dividends have caused the fund to really perform.

By the way, I'm a huge believer in DRIPS, especially in tax-defered accounts. I have about 20% of my portfolio in MACSX for that reason. I also like any fund that tracks the Dividend Achievers Index, since it will have a very low expense ratio and tracks high yielders with long histories of growing dividends.

PRFDX: Summary for T. ROWE PRICE EQUITY INCOME FD- Yahoo! Finance

PRFDX: Profile for T. ROWE PRICE EQUITY INCOME FD - Yahoo! Finance
Last Dividend (11-Dec-09): 0.10
Last Cap Gain (27-Mar-08): 0.71
Annual Holdings Turnover 31.60%
Average for Category: 75.50%

PRFDX: Historical Prices for T. ROWE PRICE EQUITY INCOME FD - Yahoo! Finance
28-Sep-09 $ 0.09 Dividend
26-Jun-09 $ 0.09 Dividend
27-Mar-09 $ 0.11 Dividend
11-Dec-08 $ 0.16 Dividend
26-Sep-08 $ 0.15 Dividend
26-Jun-08 $ 0.14 Dividend
27-Mar-08 $ 0.85 Dividend
18-Dec-07 $ 1.63 Dividend
26-Sep-07 $ 0.16 Dividend
27-Jun-07 $ 0.15 Dividend
28-Mar-07 $ 0.47 Dividend
19-Dec-06 $ 0.85 Dividend
27-Sep-06 $ 0.12 Dividend
28-Jun-06 $ 0.12 Dividend
29-Mar-06 $ 0.19 Dividend
13-Dec-05 $ 1.27 Dividend
28-Sep-05 $ 0.11 Dividend
28-Jun-05 $ 0.11 Dividend
29-Mar-05 $ 0.30 Dividend
14-Dec-04 $ 0.68 Dividend
28-Sep-04 $ 0.09 Dividend
28-Jun-04 $ 0.10 Dividend
29-Mar-04 $ 0.27 Dividend
17-Dec-03 $ 0.37 Dividend
26-Sep-03 $ 0.10 Dividend
26-Jun-03 $ 0.08 Dividend
27-Mar-03 $ 0.11 Dividend
18-Dec-02 $ 0.46 Dividend
26-Sep-02 $ 0.09 Dividend
26-Jun-02 $ 0.08 Dividend
26-Mar-02 $ 0.18 Dividend
12-Dec-01 $ 0.67 Dividend
26-Sep-01 $ 0.10 Dividend
27-Jun-01 $ 0.09 Dividend
28-Mar-01 $ 0.51 Dividend
13-Dec-00 $ 2.06 Dividend
27-Sep-00 $ 0.13 Dividend
28-Jun-00 $ 0.13 Dividend
29-Mar-00 $ 0.83 Dividend
15-Dec-99 $ 1.88 Dividend
28-Sep-99 $ 0.13 Dividend
28-Jun-99 $ 0.14 Dividend
29-Mar-99 $ 0.35 Dividend
29-Dec-98 $ 0.15 Dividend
16-Dec-98 $ 1.36 Dividend
28-Sep-98 $ 0.16 Dividend
26-Jun-98 $ 0.16 Dividend
27-Mar-98 $ 0.27 Dividend
29-Dec-97 $ 1.95 Dividend
26-Sep-97 $ 0.16 Dividend
26-Jun-97 $ 0.15 Dividend
26-Mar-97 $ 0.54 Dividend
27-Dec-96 $ 0.88 Dividend
26-Sep-96 $ 0.16 Dividend
26-Jun-96 $ 0.16 Dividend
27-Mar-96 $ 0.29 Dividend
27-Dec-95 $ 0.56 Dividend
27-Sep-95 $ 0.17 Dividend
28-Jun-95 $ 0.16 Dividend
29-Mar-95 $ 0.30 Dividend
28-Dec-94 $ 0.84 Dividend
28-Sep-94 $ 0.15 Dividend
28-Jun-94 $ 0.14 Dividend
29-Mar-94 $ 0.27 Dividend
22-Dec-93 $ 0.70 Dividend
28-Sep-93 $ 0.14 Dividend

**ea1776** · 12-29-2009, 09:43 AM

Thanks for posting Jim. Didn't know Yahoo Finance had that dividend history feature. That is useful.

Looks like the fund outperforms its benchmark most of the time and with the yield included it was slightly less than the S&P this year. Only thing I would worry about are those load expenses, but maybe those are waived if you buy directly from T. Rowe? I don't think we pay loads for PRLAX and the New Era fund which we do an AIP for in my wife's roth.

**jIM_Ohio** · 12-29-2009, 09:57 AM

all T rowe price funds are 100% no load
watch the commercials LOL

where did you see it had a load? I have never paid a load for any fund I own...

**ea1776** · 12-29-2009, 10:27 AM

Originally posted by jIM_Ohio View Post

all T rowe price funds are 100% no load
watch the commercials LOL

where did you see it had a load? I have never paid a load for any fund I own...

maybe just a typo. checkout the Profile section on the link you posted previously. it shows these %'s.

Max Front End Sales Load: 5.45%
Max Deferred Sales Load:2.64%

That is weird, cuz yeah I've never payed loads on T. Rowe's funds and they've generally been great performers for us, especially PRLAX & New Era. But I've never bought them from an outside broker, so maybe that's where they come into play.

**jIM_Ohio** · 12-29-2009, 10:57 AM

I saw that on profile page
not sure if that is fund specific
or category max's and averages

Most T Rowe funds which get "sold" change the ticker symbol- for example I do know of some annuity/insurance companies which use equity income as their fund inside the insurance account, but that fund has a different ticker, which has a load on it. Eventually $95 of the $100 gets sent to T Rowe, but some is taken off the top of the other ticker on the performance charts...

**Snodog** · 12-29-2009, 12:27 PM

Flpsx has made me a lot of money over the last 10 years. Course now I no longer own it and have switched to only index funds and etf's. During the 2000-02 downturn it actually made a nice profit. This was the only fund I owned for many years until a couple of years ago when I got serious about investing and changed my investment strategy. Now all my favorite funds are index funds.

**Beppington** · 12-29-2009, 12:33 PM

Originally posted by ea1776 View Post

I wanted to start a thread on people's favorite mutual fund. You know the one. Seems to outperform the market time and time again and you feel all warm and fuzzy when you invest new money in it, because you know it will do well over the long haul. Ok, I know you aren't supposed to get emotional about investing, but when a fund performs so well and you like its manager, it does sorta become like an old' pal.

Just 1 Rule:

No Posting Index Funds. I know that'll be hard for a great majority of you. This thread isn't about investing style, its just about your favorite fund!

I was trying to relate your question to something like: "Would you rather play the slots in Las Vegas, or Atlantic City?" ... as in, yes you might win for a little while, & be entertained doing so, but over the long haul you're gonna lose money (or in this case trail the alternative*). In Vegas/ AC your money goes to The House; In managed mutual funds your money goes to the Fund Manager.

Anyway ... before I discovered those unmentionable index funds*, my favorite was LETRX (Russian). I owned it 1/21/04 to 1/26/06. Of course it was my favorite because I bought at $24.56/ share & sold at $45.60/ share; Almost doubled in 2 years. And, for a more impressive bigger picture, from Aug. '98 to early Dec. '07, it climbed from $2.78/ share to $80/ share. Awesome! However, it's now down around $32.

**ea1776** · 12-29-2009, 12:40 PM

Originally posted by Beppington View Post

I was trying to relate your question to something like: "Would you rather play the slots in Las Vegas, or Atlantic City?" ... as in, yes you might win for a little while, & be entertained doing so, but over the long haul you're gonna lose money (or in this case trail the alternative*). In Vegas/ AC your money goes to The House; In managed mutual funds your money goes to the Fund Manager.

Thanks for posting. Seems to me the only number that matters is your return on investment after expenses. I don't care if the expense ratio is 45% so long as the manager is beating the market after expenses.

Sure, superior funds might be few and far between, but good managers with good strategies, held by "non-lazy" (for lack of a better term, haha) investors will outperform an index fund IMHO. There are many examples of this.

I will agree though that index funds are the best vehicles for many investors, especially "lazy" (i really just mean they don't want to use their time worrying about financial stuff) and/or uninformed investors.

**asdf32** · 01-07-2010, 01:56 PM

Originally posted by ea1776 View Post

Thanks for posting. Seems to me the only number that matters is your return on investment after expenses. I don't care if the expense ratio is 45% so long as the manager is beating the market after expenses.

Sure, superior funds might be few and far between, but good managers with good strategies, held by "non-lazy" (for lack of a better term, haha) investors will outperform an index fund IMHO. There are many examples of this.

I will agree though that index funds are the best vehicles for many investors, especially "lazy" (i really just mean they don't want to use their time worrying about financial stuff) and/or uninformed investors.

I simply can't find any evidence to convince myself that it's in my interest to actively manage my funds or that I should put money in actively managed funds.

Not only do actively managed funds under-perform indexes (on average) but (on average) past performance of active funds is INVERSELY correlated with future performance.

I could be convinced otherwise with evidence. So that said my money is in a mix of funds and ETF's.

Large S&P index: FUSEX
Mid Index: FSEMX, IJH
Small Index: IWM
International Index: ACWX
Emerging Markets: EEM
US Bond: AGG, FBIDX
Short Term Treasury: FSBIX

**srblanco7** · 01-07-2010, 05:51 PM

A couple of favorites -

Dodge & Cox Global
Oakmark Equity Income

These would be in addition to funds already discussed, such as, T Rowe Price Equity Income and T Rowe Price New Era.

**poundwise** · 01-07-2010, 07:58 PM

I like FMIHX

Favorite Mutual Funds