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"...It turns out that load funds consistently underperform no-load funds, even when you back out fees.
That's what Tim Hanson and I found in our survey of the best funds of the past decade. Of the top-performing funds, 76% charged no load.
Academic research drives the point home even more: In 1998, Professor Craig Israelsen found that "even after ignoring the impact of loads, no-load funds had, on average, significantly higher returns."
Five years later, in Financial Planning Magazine, Israelsen wrote about a different time frame. The result was the same: No-load funds were superior to load funds."
AF are top notch funds along with Vanguard and T. Rowe Price. Its the big 3.
I think you have to look beyond 10 years to get a good feel about a mutual fund. It's all about performance. I've owned both load and no loaded funds. I think you can go overboard worrying about expenses. There are a bunch of very good funds out there and AF has its share. Just remember that investing in mutual funds should be for long term investing only, no shorter than 5 years.
On Scottrade, I can filter mutual funds by TNA (total net assets). Take a look at Pimco Total Return. The one you want to buy is the D class, PTTDX, but its performance is near identical to PTTRX.
Pimco Total Return has got more total net assets than anyone else (most popular mutual fund?), best 10 year, 5 year, and 1 year performance. You also likely won't have to worry about your money losing its value.
This is the biggest mutual fund, so therefore, the largest bond fund.
This is the second largest mutual fund and the largest stock fund.
These charts came from Scottrade and they show your growth of $10,000 invested in 1999.
On Scottrade, I can filter mutual funds by TNA (total net assets). Take a look at Pimco Total Return. The one you want to buy is the D class, PTTDX, but its performance is near identical to PTTRX.
Pimco Total Return has got more total net assets than anyone else (most popular mutual fund?), best 10 year, 5 year, and 1 year performance. You also likely won't have to worry about your money losing its value.
This is the biggest mutual fund, so therefore, the largest bond fund.
This is the second largest mutual fund and the largest stock fund.
These charts came from Scottrade and they show your growth of $10,000 invested in 1999.
Pretty much everyone lost in 2008. AF lost less value then the average market which is good.
Pimco is a Bond. Bonds perform well in a down market.
True most lost in 2008, but even in good markets, Pimco Total Return did well while avoiding the volatility of stocks. If you had American in your portfolio, you might have freaked out and who knows what, while if you were a PIMCO holder, you'd still feel pretty good.
Here is the chart again since I can't see the Scottrade ones.
This is the PTTDX chart.
Here is AGTHX.
If you think you can handle your money yourself, than buying in 1999, selling in 2000, buying again in 2003, selling in 2007, etc., you could be ahead of bonds by a good bit. If you dare to time the market though... For most people though, I think bonds are still better.
Especially in these times. The DOW has fell for 4 straight weeks. We have all kinds of crazy government interfering now, all kinds of clouds with regards to the housing and jobs market. I don't understand why one should have confidence in the markets.
In all 880 rolling 10-year spans since the end of 1925 (starting with December 1925 to December 1935, then January 1926 to January 1936, and so on), bonds accomplished this feat only about 17% of the time. And those episodes were almost all clustered around four periods: the Great Depression, the 1970s, the early 1990s, and, of course, this past decade.
We are going to again, live through anemic times with regards to growth. Bonds win
True most lost in 2008, but even in good markets, Pimco Total Return did well while avoiding the volatility of stocks. If you had American in your portfolio, you might have freaked out and who knows what, while if you were a PIMCO holder, you'd still feel pretty good.
Here is the chart again since I can't see the Scottrade ones.
This is the PTTDX chart.
Here is AGTHX.
If you think you can handle your money yourself, than buying in 1999, selling in 2000, buying again in 2003, selling in 2007, etc., you could be ahead of bonds by a good bit. If you dare to time the market though... For most people though, I think bonds are still better.
Especially in these times. The DOW has fell for 4 straight weeks. We have all kinds of crazy government interfering now, all kinds of clouds with regards to the housing and jobs market. I don't understand why one should have confidence in the markets.
In all 880 rolling 10-year spans since the end of 1925 (starting with December 1925 to December 1935, then January 1926 to January 1936, and so on), bonds accomplished this feat only about 17% of the time. And those episodes were almost all clustered around four periods: the Great Depression, the 1970s, the early 1990s, and, of course, this past decade.
We are going to again, live through anemic times with regards to growth. Bonds win
I have had AF's since Summer of 2007 and continued to buy funds throughout the downfall.
I do have Pimco in my 401K.
Overall Stocks have always outperformed Bonds in the long run.
Bonds are for people who are over the age of 60 and retired.
Also remember I bought these stocks dirt cheap when the market was down which means Dollar Cost Averaging.
I have EuroPacific Growth (cheap R5 share class). It got trounced in 2008, but was in the 11th percentile in terms of performance. It has bounced back this year and is in the top 15% year to date, but far from making up last year's losses.
I also have Growth Fund of America A. That one got hit pretty hard last year and has bounced back this year...but same story, the bounce hasn't made up for the losses. It was around 35th percentile last year and around the same this year...not top notch, but consistently decent compared with other funds in its category.
American Funds has some pretty good funds, but IMO it's not smart to pay a big load for a fund when it's likely there are NO-LOAD funds out there which are just as good if not better. That is, unless, you really need the hand-holding of a GOOD advisor (many are just a salesman) and you're willing to pay for it.
I agree with you. But some of us (like me) can get American Funds via our employer sponsored retirement plans, so we don't have to pay the load.
I have Growth Fund of America A (load waived).
and also a really cheap share class of EuroPacific Growth (R5 share class, which is has a cheaper expense ratio than A shares & has no load).
I love American Funds as long as I don't have to pay the load.
No load funds outperform loaded funds? Any source?
I don't remember the source, but I think I remember reading they do about the same if you don't factor in the load.
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