Vanguard winners and losers 2007
Vanguard is a not-for-profit mutual fund company with the lowest fees in the business. That's why I keep some of my extra money with them. Right now my Vanguard money is split between the Prime Money Market Fund (up 5.14%) and the STAR Balanced Fund (up 6.58%).
During 2006 all of their funds, no matter what they invested in, went up. That was not a typical year ;-) 2007 was a little more typical, in that some funds went up and some funds went down.
Vanguard's Total US Stock Market Index Fund, which invests in a representative cross section of the entire US market, was up 5.49% for the year.
Here are Vanguard's top winners and losers of 2007:
Emerging Markets Stock Index Fund -- up 38.90%
Energy Fund -- up 37.00%
Precious Metals & Mining Fund -- up 36.13%
Real Estate Index Fund -- down 16.46%
Capital Value Fund -- down 7.65%
Small-Cap Value Index Fund -- down 7.07%
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For a conservative investor like myself, you'd probably be pleased with one of Vanguard's "Balanced" or "Life-Cycle" funds, which systematically allocate money across a diversity of stocks and bonds. For several years I kept my IRA in the LifeStrategy Conservative Growth Fund. They've got excellent Target Retirement Date funds.
The best way to invest in any stock mutual fund is to buy regular monthly or quarterly amounts across several years, intending to keep your funds invested over the long haul. Timing the market is very difficult. Keep in mind the difference between investing and gambling -- investing is a deliberate and long-term plan, whereas gambling is a short-term flip. Gamble if you want, but don't confuse it with investing ;-)
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From a historical perspective, stocks are pretty expensive right now. I expect broadly-based big gains will be difficult to find for the next few years. But if you are a long-term, monthly investor, the next few years should be a good period for accumulating a substantial position in stocks. Buy extra during the down cycles ;-) And be very patient.
During 2006 all of their funds, no matter what they invested in, went up. That was not a typical year ;-) 2007 was a little more typical, in that some funds went up and some funds went down.
Vanguard's Total US Stock Market Index Fund, which invests in a representative cross section of the entire US market, was up 5.49% for the year.
Here are Vanguard's top winners and losers of 2007:
Emerging Markets Stock Index Fund -- up 38.90%
Energy Fund -- up 37.00%
Precious Metals & Mining Fund -- up 36.13%
Real Estate Index Fund -- down 16.46%
Capital Value Fund -- down 7.65%
Small-Cap Value Index Fund -- down 7.07%
-----
For a conservative investor like myself, you'd probably be pleased with one of Vanguard's "Balanced" or "Life-Cycle" funds, which systematically allocate money across a diversity of stocks and bonds. For several years I kept my IRA in the LifeStrategy Conservative Growth Fund. They've got excellent Target Retirement Date funds.
The best way to invest in any stock mutual fund is to buy regular monthly or quarterly amounts across several years, intending to keep your funds invested over the long haul. Timing the market is very difficult. Keep in mind the difference between investing and gambling -- investing is a deliberate and long-term plan, whereas gambling is a short-term flip. Gamble if you want, but don't confuse it with investing ;-)
-----
From a historical perspective, stocks are pretty expensive right now. I expect broadly-based big gains will be difficult to find for the next few years. But if you are a long-term, monthly investor, the next few years should be a good period for accumulating a substantial position in stocks. Buy extra during the down cycles ;-) And be very patient.