Top 10 Percentage News Hubb
Advertisement Banner
  • Home
  • Business Management
  • Healthcare Management
  • Wealth Management
  • Contact
No Result
View All Result
  • Home
  • Business Management
  • Healthcare Management
  • Wealth Management
  • Contact
No Result
View All Result
Gourmet News Hubb
No Result
View All Result
Home Wealth Management

Dodge & Cox Go For A Bold Strategy – Validea’s Guru Investor Blog

admin by admin
November 26, 2022
in Wealth Management


In late 2020, after loading up on its favorite stocks in the March crash earlier in the year, the Dodge & Cox Balanced fund (DODBX) took up a 5% short futures position in the S&P 500 in order to hedge against a possible future market decline. The hedge, now down to 2% amidst more appealing valuations, is still on, and has helped the fund outperform its peers, reports a profile on the fund and its managers in Barron’s.

While DODBX is down 9.8% this year, that’s much less than the average balanced fund in Morningstar’s Allocation-50% to 70% Equity category, which are down 15.1%. And in the past decade, DODBX has outperformed 96% of its peers, garnering annualized returns of 9.3% compared to the category’s 6.2%. It also has a low expense ratio for an active balanced fund at 0.51%. The fund is run by a committee at Dodge & Cox’s Portfolio Strategy Group, rather than just one manager, and generally takes a value-oriented approach, though it added Amazon to its portfolio this year, which despite a severe price cut this year still has a 82 price/earnings ratio. But that purchase fits with Dodge & Cox’s long view of, not “necessarily buying the company that you see today, [but]…investing in what you think the company is going to look like in the future,” Dodge & Cox CIO David Hoeft told Barron’s.

But some analysts believe that DODBX is overweighted in its bond portfolio, with 14.8% in securitized debt as of September 30th. Says Morningstar analyst Jason Kephart, “The underlying stock and bond funds have not paired well over the last decade,” and rated the fund Bronze. But Dodge & Cox’s associate director of fixed income, Lucy Johns, points to mortgage bonds as being less risky as interest rates go up, since no one wants to refinance in an era of such high rates. Meanwhile, on the equity side, financial services make up the largest sector in the fund. With a possible recession on the horizon, fears of credit losses are mounting, but valuation multiples have already declined almost 40% from their peak in financials, meaning that a dire credit scenario is already being factored in, Hoeft maintains, adding that banks will also profit from higher interest rates, and they are much better positioned in terms of capital and liquidity now than during the 2007-09 financial crisis.



Source link

Previous Post

2022 State ballot initiatives impacting employment law

Next Post

ETFs With the Greatest Inflows in the Past Month

Next Post

ETFs With the Greatest Inflows in the Past Month

Recommended

Guggenheim’s Minerd Was a Wall Street Outsider Who Made It His Home

1 month ago

Are Untrained Managers Ruining Your Business?

5 months ago

Never Listen to Market Forecasts, Especially Mine – Validea’s Guru Investor Blog

1 month ago

Net zero: Next moves for CEOs

8 hours ago

How Buffett Beat The Market This Year – Validea’s Guru Investor Blog

4 weeks ago

7 Ways to Guarantee Your Team Will Be Highly Engaged

5 months ago

top-10-white

© 2022 Top 10 Percentage News Hubb All rights reserved.

Use of these names, logos, and brands does not imply endorsement unless specified. By using this site, you agree to the Privacy Policy and Terms & Conditions.

Navigate Site

  • Home
  • Business Management
  • Healthcare Management
  • Wealth Management
  • Contact

Newsletter Sign Up.

No Result
View All Result
  • Home
  • Business Management
  • Healthcare Management
  • Wealth Management
  • Contact

© 2022 Top 10 Percent News Hubb All rights reserved.