You would have to call a fund company directly, or invest through a brokerage firm, such as Fidelity or E*trade or Schwab.
On purchasing the Kip 25, for starters you wouldn't buy all 25. A good place to start is with our 3 recommended portfolios, which are designed for people with different time horizons and levels of risk tolerance. For example, you can replicate the "for college" portfolio, the one designed for people 6 to 10 years from their goal, for as little as $25K in a regular account, $20K in an IRA. And I see Robert has posted the portfolios
Investing in the entire group of 25 funds would require a large sum of money, which probably isn't feasible for a new investor. Read about the funds in the May issue, or go online to Kiplinger.com. Start with a diversified large-company fund and buy shares.
Bingo. We must be reading each other's minds
Or as Manny and Robert suggest, choose one of the portfolios.
Yes--but some funds you have to buy directly in order to avoid a transaction fee. Osterweis Strategic Income for instance, is sold free on E*Trade, but Fidelity will charge you $75. You can avoid the $75 fee by buying directly from Osterweis.
Opening up a brokerage account with a firm with a large collection of no-transaction-fee no-load funds is a good way to start a portfolio. Be forewarned, though, that not every fund in the Kip 25 is available in NTF programs. If that's the case, you need to look for a substitute funds or be willing to swallow the transaction fee when you and sell a fund
There you go again, Nellie -- helping folks to cut down on investing fees!
Clearly, we're not planning our answers in advance :)
I love that fund--I just talked to someone over there about it. It's now closed to new investors though I believe--that was one reason we didn't include it this year in the Kip25
I'm not familiar with Vanguard Star, unfortunately. I'm just looking at it now quickly
My initial reaction to the Vg Star question was, sure, any balanced fund filled with low-cost Vg funds should be a decent choice. But I just took a look at the portfolio and I bothered by the fact that 12.5% of the assets are in Vanguard Long-Term Investment Grade Bond. In today's environment long-term bonds are a no-no, IMO
I see it's a fund of 11 actively managed funds. And Morningstar has a "silver" rating on it. It charges low fees, and holds both stocks and bonds. To properly assess, I'd
have to look at the funds inside the funds.
Manny, I'm sure there are lots of folks wondering whether the bull run can continue throughout the rest of the year. Quick guidance on how investors, happy with their gains to date, should proceed?
The answer to your 25% allocation to Vanguard's Institutional Index fund depends on a lot of other factors--your age, what your risk tolerance is, what the other 75% is invested in.
But the fund is a good one--it's the lower-fee class of Vanguard's 500 Index fund, so you're paying low fees.
The stock market has already exceeded our prediction for the year. In our January issue, we had predicted high-single digit gains for 13. Here we are in mid April and the S&P 500 has already returned 12%. The market has gone up almost straight up since Nov and is probably due for a 10% or so correction, which could occur for no apparent reason. On the other hand, one of the oldest most popular market saws is "Don't Fight the Fed." Today, we can adjust that adage to "Don't Fight the Feds." Central banks all over the world are engaged in loose monetary policy (see Japan's moves last week) and that's bullish for stocks. What we don't know is how investors will react once the monetary authorities start to retreat from today's easy-money policies
This fund was also mentioned in the 401K funds story we did in the April issue--it charges only 0.04% in annual expenses (that's lower than some ETFs!).
Speaking of Japan, by the way, its market has had a huge run since last November. Despite that, the Nikkei index is still something like 65% below its 1989 high. I've actually been considering upping my stake in Japanese stocks (though I'm aware that my international funds have stakes there)
I'm not a financial adviser, but from this brief look, it looks like you're doing well with your allocation
And kudos to wreckon95 for having such a good handle on his allocation.
And like Manny said earlier--I, too, have an above-average risk tolerance
Matthews Asia Dividend, one of the Kip 25 funds, has 22% in Japan.
We'll be wrapping up shortly. Last call for questions from the audience.
Manny and Nellie, were there one or two good funds that just missed the cut for this year's Kip 25 that you'll be keeping an eye on in the year ahead?
Dodge & Cox International and Harbor International have 11% and 10% in Japan, respectively
Nellie, we looked at another multi-sector bond fund, didn't we?
There were a couple of funds that we liked but both were closing to new investors this year, so I can't really mention them.
I'm showing my age here, but I can't recall. There was a muni-bond fund--run by a manager I've been keeping my eye on for a while, and will continue to watch.
And, similarly, are there any Kip 25 funds we're worried about at this point?
Nellie, did we take a look at Fidelity Small Cap Discovery?
We did look at that fund, but it closed to new investors before we could write about it
I'm happy with the list as it is today--of course, not all funds will be "on" at all times. The group includes some strategies that require patience (EM stocks for instance, are down this year). But we have great managers in the Kip 25
At present we're not worried about any funds for performance reasons. That could change over the course of the year, of course. But one thing we look at is a fund's asset base. In the world of mutual funds big is not necessarily better cause it gets too hard to run a gigantic fund. A few that we're watching carefully are Fidelity Contrafund and Fidelity Low Priced Stock, plus Baron Small Cap.
I should add that there are some funds in the list that are getting big--Contrafund, Low-Priced Stock, Baron Small Cap.
Yup, we'll be watching those carefully
LOL. Our paths (and minds) cross
As you can see, we try to have a good time at Kips :)
Kind of you to say that, Sam
OK, we're going to start wrapping up here. A BIG thanks to Nellie Huang and Manny Schiffres for their time and expertise today.
And thanks to you viewers for participating!
It was our pleasure. Hope to "see" you all again at a future chat
Thanks as well to all the folks who submitted questions or even just sat back and watched the event. We're glad you joined us.
Take care, everybody. Happy investing!