I currently have the 60/40 LifeStrategy fund VSMGX in an inherited IRA. 60/40 is what I'm comfortable with, the fund has a low ER, I'm happy to have the one-fund portfolio and pay a few extra bucks to sleep well at night. The funds within VSMGX are all solid and I'm happy with it.
I have been reading up on FBALX, however, and despite its 0.47% ER, it does really well over time. It does a LOT better than VSMGX; you might assume this is because FBALX has no international exposure, but I looked back and even during times when ex-US stocks outperformed US stocks it still did better.
0.47% seems high. But the data on this fund seems to indicate that it's an excellent choice. I'm at Fidelity for a variety of customer-experience reasons but I can buy Vanguard funds for $100; it's an inherited IRA so it's not like I'd be making regular contributions to it and paying loads each time. I have no loyalty to Fidelity funds vs. Vanguard funds because if I buy them it's a one-time thing.
Questions:
1) What is it about FBALX that has it performing so much better than VSMGX? And it's not the slightly higher equities: if you made a portfolio out of VSMGX and VSAGX, or AOR and AOA so that you hit the same 65/35 allocation as FBALX you'd find that FBALX has done considerably better.
2) is FBALX a decent one-fund solution? Is the ER worth the performance that it seems to display? I know past performance doesn't guarantee future success but this thing has been around since I was in high school.
3) Are there other funds other than VSMGX that would be a good one-fund solution for someone looking for a 60/40 ish allocation?
Thanks!
Steveo
I have been reading up on FBALX, however, and despite its 0.47% ER, it does really well over time. It does a LOT better than VSMGX; you might assume this is because FBALX has no international exposure, but I looked back and even during times when ex-US stocks outperformed US stocks it still did better.
0.47% seems high. But the data on this fund seems to indicate that it's an excellent choice. I'm at Fidelity for a variety of customer-experience reasons but I can buy Vanguard funds for $100; it's an inherited IRA so it's not like I'd be making regular contributions to it and paying loads each time. I have no loyalty to Fidelity funds vs. Vanguard funds because if I buy them it's a one-time thing.
Questions:
1) What is it about FBALX that has it performing so much better than VSMGX? And it's not the slightly higher equities: if you made a portfolio out of VSMGX and VSAGX, or AOR and AOA so that you hit the same 65/35 allocation as FBALX you'd find that FBALX has done considerably better.
2) is FBALX a decent one-fund solution? Is the ER worth the performance that it seems to display? I know past performance doesn't guarantee future success but this thing has been around since I was in high school.
3) Are there other funds other than VSMGX that would be a good one-fund solution for someone looking for a 60/40 ish allocation?
Thanks!
Steveo
Statistics: Posted by steveosteveo — Tue Feb 04, 2025 5:03 pm — Replies 3 — Views 236