Top 10 Popular Taxable Investment Grade Bond Closed End Funds

This article will be all about Top 10 popular Investment Grade Taxable Bond Closed End Funds. The fund providers include Western Asset, Eaton Vance, Federated, John Hancock, PIMCO, BlackRock and MFS. The list also include Western Asset Premier Bond, PIMCO Corporate Opportunity and more.

The following is the Top 10 Best Taxable Investment Grade Bond Closed End Funds:

1. Western Asset Premier Bond (WEA)
2. EV Limited Duration Income (EVV)
3. Federated Enhanced Treasury Income (FTT)
4. John Hancock Income Securities
5. PIMCO Corporate Opportunity
6. Franklin Limited Duration Inc
7. BlackRock Credit Alloc II
8. Blackrock Credit Allocation IV
9. MFS Government Markets Income
10. BlackRock Credit Alloc III

Best National Municipal Bond Closed End Funds

Closed End Funds or CEFs can provide an attractive alternative for investors to invest in municipal bond. These municipal debt funds provide tax free income for investors. Some of the best municipal bond closed end funds are: PIMCO Municipal Income III, EV Municipal Income, Invesco VK Muni Opps. Trust, etc.

Municipal Bond Fund

Closed end funds are not very popular in investment world and they rarely will get any respects. The closed end funds unlike mutual fund are being traded like stock. This article will provide top 10 national municipal bond closed end funds (CEF) which are tax free. The CEF sponsors include PIMCO, Eaton Vance, BlackRock, Invesco.

The following is the Top 10 Best National Municipal Bond Closed-End Funds:

1. PIMCO Municipal Income III - PMX
2. EV Municipal Income - EVN
3. Invesco VK Muni Opps. Trust - VMO
4. Invesco VK Muni Invst. Grade T - VGM
5. EV Municipal Bond II - EIV
6. BlackRock MuniVest Fund II - MVT
7. Invesco VK Adv Muni Inc II - VKI
8. Putnam Managed Muni Income - PMM
9. Invesco VK Select Sector Muni - VKL
10. PIMCO Municipal Income - PMF

updated on 11/27/2010

Happy Thanksgiving 2010

Happy Thanksgiving! Have a safe holidays!

Turkey anyone?

Top 8 Best Municipal Bond Mutual Funds

The following article will provide top 10 list of municipal bond mutual funds also known as non taxable bond funds. The non taxable bonds consist mainly the municipal bonds either investment grade municipal bond or non investment grade municipal bond. The list include Vanguard Intermediate Term Tax Exempt, Vanguard Limited Term Tax Exempt, American Funds Tax Exempt Bond, and more.

Tax Free Muni Bond Funds

My list mainly consists of 3 or more star of Morningstar rating and big asset underlying the municipal bond mutual funds. Usually, big asset means lot of confident by investor as well constitutional to invest in these funds. With 3 or more star rating, this means the fund has consistently perform under any market condition and should perform better or at least average compare to many of its index benchmark. I also provide list that doesn’t include only 1 state municipal bond funds, this means the list is more diversify and includes multiple states in US.

The following is the Top 8 Best Municipal Bond mutual funds:

1. Vanguard Intermediate Term Tax Exempt Fund - VWITX
2. Vanguard Limited Term Tax Exempt Fund - VMLTX
3. Franklin Federal Tax Free Income - FKTIX
4. American Funds Tax Exempt Bond - AFTEX
5. Franklin High Yield Tax Free Income Fund - FRHIX
6. Vanguard Long Term Tax Exempt Fund - VWLTX
7. Wells Fargo Advantage Ultra Short Term Municipal Income Fund - SMAVX
8. Vanguard High Yield Tax Exempt Fund - VWAHX

Top 5 Vanguard Mutual Funds

The following article will provide top 10 popular Vanguard Mutual Funds list including stock and bond fund. The list is as follows: Vanguard Total Stock Market,Total Bond Market Index, Emerging Markets Stock Index, Vanguard Wellington and more. Top 5 Vanguard Mutual Funds are:

1. Vanguard Total Stock Market - VTSMX
2. Vanguard 500 Index Fund - VFINX
3. Vanguard Total Bond Market Index - VBMFX
4. Vanguard Emerging Markets Stock Index
5. Vanguard Wellington

1. Vanguard Total Stock Market (VTSMX)

This Vanguard Total Stock Market fund has $190 billion total net assets. As part of index fund, this large blend mutual fund has an expense ratio of 0.17%. The annual turnover holding rate is 5%. It is rated with 4 stars rating and gold rating by Morningstar. This fund is passively managed by Gerard C. O'Reilly. This domestic stock fund has returned 19.66% over the past 3 year, 1.27% over the past 5 year, and 4.82% over the past 10 year.

2. Vanguard 500 Index Fund (MUTF: VFINX)

This Vanguard 500 index fund's objective is to track the performance of he Standard & Poor's 500 index. This large blend fund has total net assets of $114 billion. The expense ratio is 0.17% per year. It also has a yield of 1.75%. Michael H. Buek is the fund manager. Investor can start buying this fund with $3,000 minimum initial investment. As of January 2012, the top 5 stocks in its assets are: Exxon Mobil Corporation, Apple Inc, International Business Machines Corp, Chevron Corp, and Microsoft Corp.

3. Vanguard Total Bond Market Index (Ticker: VBMFX)

Rated with gold rating, this Vanguard Total Bond Market Index fund is another popular mutual fund offered by Vanguard. It has an expense ratio of 0.22%. This intermediate term bond fund has a yield of 2.98%. The average effective duration is 5 years and the average effective maturity is 7.2 years. Managed by Kenneth Volpert, this bond mutual fund has returned 7.68% over the past year, 6.89% over the past 3year, and 5.46% over the past decade. As of January 2012, the top 5 sectors are U.S. Treasury (35.65%), Agency MBS Pass-Through (25.60%), Corporate Bond (20.63%), U.S. Agency (4.15%), and Other Government Related (1.95%).

Reasons to buy

If you are interested in Vanguard Brokerage Services account to buy ETF, please check my previous article. There are several reasons why you should consider a Vanguard:

1. Vanguard is owned by its shareholders (i.e. not for profit company)
2. Most of the products whether ETFs or Mutual Funds have the lowest expenses in industry
3. As an investor, you can have many products to choose from whether they are stocks funds or bond funds.
4. Most of the fund follows index and passively managed which can provide a way to follow the market closely. There is less second guessing by its fund manager.

Disclosure: No Position updated on 4/20/2012

Best Taxable Diversified Bond Mutual Funds

The following article will provide top 10 taxable bond mutual funds list. Bond funds are another good way to diversify your investment portfolio since they are also less volatile than stock funds. The list include Pimco Total Return, Vanguard Total Bond Market Index and more.

Intro

Bond also known as fixed income can be classified into two main categories such as taxable bonds and non taxable bonds. Taxable bond can consist of short term bond, intermediate term bond, long term Bond, Investment Grade Corporate Bond, High Yield Corporate bond (Non Investment Grade corporate bond), Treasury Inflation Protected (TIP) Bond. These taxable bonds can be either domestic bonds or global bonds.

The non taxable bond consist mainly the municipal bonds either investment grade municipal bond or non investment grade municipal bond. Non taxable bond mutual funds dividend is usually non taxable. I will provide more details about non taxable bond in my later article. For this article I will focus on taxable bond mutual funds.

The following is the Top 10 list of taxable bond mutual funds:

1. Pimco Total Return
2. Vanguard Total Bond Market Index
3. Templeton Global Bond
4. Vanguard Short-Term Investment-Grade
5. Vanguard GNMA
6. Vanguard Inflation Protected Securities
7. Dodge & Cox Income
8. PIMCO Low Duration A
9. Vanguard Short-Term Bond
10. Loomis Sayles Bond

You can also check my other top bond funds article:

• Best Municipal Bond Mutual Funds September 2011
• Best International Bond Mutual Funds of 2011

Free ETF Trades by Vanguard, Fidelity, Schwab, TD Ameritrade

The exchange traded fund or ETF sector is growing much faster than mutual funds. Recent data has shown that investors have pouring money into this investment fund. More providers and brokerages have provided free ETFs trading option. There are currently 4 brokerages which offer Free ETF trades such as Schwab, Fidelity, TD Ameritrade and Vanguard.

Intro

Most of these ETFs are Passively managed ETFs or index ETFs. This index ETFs track various indexes such as Nasdaq, S&P 500, Russell, and MSCI.

• Fixed income / Bond: short term bond fund, intermediate term bond fund, diversified bond fund, government bond fund, Investment Grade Corporate Bond, High Yield Corporate bond (Non Investment Grade corporate bond), Treasury Inflation Protected (TIP) Bond, emerging markets bond fund, etc.
• Equity / Stock: S&P fund, NASDAQ index fund, large cap fund, Russel 2000 index fund, REIT (Real Estate Investment Trust), Emerging Markets stock fund, International Foreign Large Cap, Foreign Small Cap.
• Commodity: gold, silver, palladium, copper, sugar, cotton more
• Country Specific or Regional countries Specific ETF such as Brazil, China, Malaysia, Singapore

Vanguard

Known for its low cost mutual funds, Vanguard began offering their ETFs for free this May 2010. There are currently 62 free ETFs for trading. Most these ETFs can be traded in Vanguard Brokerage Services (VBS) account which is separate from main Vanguard account.

Fidelity

Fidelity offered 30 commission free iShares ETFs. Fidelity also offers variety of  financial products like mutual funds, cash management, full brokerage service, annuities and many more. The top 6 well known iShares ETFs are: iShares S&P 500 ETF (ticker: IVV), iShares Russell 2000 (IWM), iShares MSCI EAFE (EFA), iShares MSCI Emerging Markets (EEM), iShares Barclays Aggregate bond ETF (AGG), and  iShares Barclays TIPS ETF (TIP).

Charles Schwab

Schwab currently offers 15 commission free Schwab ETFs. These Schwab ETFs include domestic equity ETFs, International Equity ETFs, and Bond ETFs. Schwab also offers $8.95 per trade for trading stock or other ETFs. To open an account, you need $1,000.

TD Ameritrade

TD Ameritrade has offered one of the largest commission free ETFs. It has provide various ETFs from many different providers. There are currently more than 100 ETFs available for investors to choose. These exchange traded funds include 31 Equity ETFs, 3 REIT Sector ETFs, 32 Bond ETFs, 31 International ETFs, and 4 Commodity ETFs.

TD Ameritrade also offers a full brokerage service. It currently offers $9.99 per trade for trading stock or other ETFs.

Note: ETF = Exchange Traded Fund

Bubble burst on Municipal Bond CEF and ETF?

After my initial listing about Top 10 Municipal Bond CEF, the muni bond CEF has been down big time this past week (7-15% drop). Since most of the muni CEF is leveraged, investor should expect a higher volatility than usual non-leveraged fund.

As of Please trade accordingly. I still think it can be a long term investment vehicle. In my opinion, Couple factors can contribute this decline:

1. Treasury has been down after Fed announced QE2. Please check TLT (10 years+ Treasury ETF)
2. Unknown from new tea party congressman/woman. Many new elected congress had campainged about cut spending. This may affected less fed fund for state level etc and state ran big deficit especially California, Illinois, and more.
3. Unknown about tax structure. Extending Bush Tax Cut for all or only for middle class.

Looks at BKN, PMX, PML, PCK (CA Muni CEF), and more

OptionsHouse Online Discount Brokerage Review

OptionsHouse is an online brokerage services that offers low cost options and stocks trades to its large client base of investors or traders. As one of the known discount broker, they also provide low cost stock trades and other financial services (checking & Debit card) for their customers.

To trade stock, it only cost $3.95 per trade. It also doesn't have any minimum account balance. Only need $1,000 to open cash account and $2,000 for margin.

The following is the standard pricing or commission fee of Optionshouse brokerage account:

• Products: Stocks, Options, mutual funds, treasury & corporate bonds
• Market Orders: 3.95 per trade
• Limit Orders: 3.95 per trade
• Broker-Assisted Orders: $3.95 per trade
• Mutual Funds: $9.95 per trade for no load fund; additional fees for load funds
• Options: $8.50 + $0.15/contract or $1.00 per contract
• Minimum to Open: $1,000 (Cash) & $2,000 (Margin)
• Account Maintenance Fee: $0.00
• Account inactivity fee: $0.00
• IRA Closing Fee: $15.00
• Some Other Fees: Wire Fees: $15.00 per transfer.
• Outgoing ACAT: $50.00.
• Maximum Margin Rate: Based on proprietary base rate
• Extras: Check writing available. Debit cards are available at a fee for certain accounts.

Advantages using OptionsHouse:

• The commission is one of the lowest with $2.95/trade flat fee for stocks trading or ETF trading
• Also offers two structure of flexible commission plans for options trading
• There is variety of useful tools for options traders.

OptionsHouse used to have $2.95 per trade for trading stocks or ETFs.

More details on My Review of OptionsHouse Online Discount Brokerage Account

Top 5 Popular International Stock Mutual Fund

With USA economy is cooling down or at least is slow down, everyone will look at growing sector or market to invest. One of these markets is International stock sector. The funds are American Funds Europacific Growth, American Funds Capital World G/I, Dodge & Cox International, Fidelity Diversified International, Harbor International, Vanguard Total International Stock Index.

Top Bond Funds

The following is top 5 International stock mutual funds plus 1 in term of asset according to MorningStar. What I like is usually big asset is equal to big confident by investor or institutional money to invest in this fund. I also like most of these asset managers as they are well known to many investors. Looking at this list, you will find 2 American Funds mutual funds on this top 6 list.

American Funds Europacific Growth, AEPGX

American Funds family is very famous in various 401k accounts and compare to other international stock mutual fund EuroPacific Growth has almost double or triple from other competitor mutual funds. This fund is part of actively managed mutual funds. The fund's investment objective is to provide long-term growth of capital.

The fund invests primarily in common stocks of issuers in Europe and the Pacific Basin that the investment adviser believes have the potential for growth. If you choose this fund, please note that some fund classes have a front end sales load of 5.75%. The fund is managed by a lead manager, Stephen E. Bepler as well as portfolio counselors since 1984.

American Funds Capital World G/I, CWGIX

American Funds Capital World Growth and Income Fund is known for its slow and steady growth. The fund has focus on long-term capital growth and is providing income through consistent dividend since its 1993 inception. It has low expenses and volatility compare to other international stock mutual funds. If you choose this fund, please note that some fund classes have a front end sales load of 5.75%. The fund is managed by a lead manager, Stephen E. Bepler as well as portfolio counselors since 1993.

Dodge & Cox International, DODFX

The Fund invests primarily in a diversified portfolio of equity securities issued by non-U.S. companies from at least three different foreign countries such as emerging markets.

Top 10 International Large Cap Stock Mutual Funds 2012

The Fund invests primarily in medium-to-large well established companies based on standards of the applicable market. The fund is managed by a lead manager, Diana A. Strandberg, since 2001.

Fidelity Diversified International, FDIVX

Fidelity Diversified International invests in a wide-ranging mix of stocks from countries throughout the world.  The lead manager is William Bower since 2001. There is no front end sales load & is part of No Transaction Fee fund. The expense ratio is 1.01% for this class (FDIVX). It is currently a Fidelity Fund Pick.

Harbor International, HIINX

The Harbor International fund investment seeks long-term total return of capital growth. The fund invests primarily (no less than 65% of total assets) in common and preferred stocks of foreign companies that have market capitalizations in excess of $1 billion, including those located in emerging market countries.The fund is managed by Hakan E. Castegren since its inception on 1987. There is no front end sales load for this mutual fund. The Harbor International Fund (HIINX) has 1.20% expense ratio and 0.25% Max 12b1 fee.

Vanguard Total International Stock Index, VGTSX

Vanguard Total International Stock investment seeks to track the performance of a benchmark index that measures the investment return of stocks issued by companies located in Europe, the Pacific region, and emerging markets countries. The fund is passively managed by Michael Perre since 2008.
more can be read:Top 5 Popular International Stock Mutual funds plus Vanguard

TD Ameritrade Online Brokerage Account Review

TD Ameritrade is another online financial brokerage service provider with an abundant online stock trading platform for its investors as well as traders. It offers an opportunity to trade stock, option and mutual funds. The commission fees for trading stock is $9.99 per trade. Recently, TD Ameritrade offers 100+ Free commission ETFs with 30 days holding period.

The following is the standard commission for trading using TD Ameritrade platform:

• Products: Stocks, bonds, CDs, UITs, mutual funds, options, forex
• Market Orders: $9.99/trade
• Limit Orders: $9.99/trade
• IVR Phone Orders: $34.99/trade
• Broker Assisted Orders: $44.99/trade
• ETF Market/Limit Orders: $9.99/trade
• Commission Free ETFs: $0.00/trade with requirement
• Mutual Funds: $49.99 for no-load funds. NTF mutual funds: $0.00
• Options: $9.99/trade+$0.75/contract
• Futures: $3.50/contract
• Minimum to Open: $0, $2000 for margin account.
• Electronic funding minimum: $500
• Inactivity Fee: $0.00
• Some Other Fees: Paper Statement: $2.00, DTC Out:$25.00/security, ACAT Out:$75.00.
• Maximum Margin Rate: Based on proprietary base rate

Free ETF trading


Recently, it offers 100+ free commission ETFs. The current ETFs offering include:

• 31 Equity ETFs:
• 3 REIT Sector ETFs
• 32 Bond ETFs
• 31 International ETFs
• 4 Commodity ETFs

Several Pros  of TD Ameritrade

• Feature and research rich offering for all client types including research by Morningstar, S&P, and Market Edge, etc
• Customer service is very friendly and knowledgeable
• Offer thinkorswim by TD Ameritrade trade platform.
• Also offer Pre market and Post Market trading for no additional fees

More details: My Review of TD Ameritrade Online Brokerage Account and Free ETF

My current position - Bought FAM & NZH -- Sold FLIR & SRS

Wow... what a day it was. After a non event QE2 day for yesterday, all indexes were closed positve huge. In my opinion, most investor need to be careful. Don't chase anything and please raise your stop to protect gain or take some off.

Lucky for me, I sold my SRS hedge yesterday for +2.6% profit otherwise I would have lost -2.4% (a 5 % swing).

I also sold FLIR (+9.6%), I just don't see any big risk reward profile for this stock in near term. This selling maybe early. Today, it prints another doji.

I also add NZH and FAM this week for my long term. NZH is a CA Municipal CEF with 6.8% yield after tax.
I also add FAM (global bond CEF). If the dollar keep dropping like a rock, the other currency will rise. I also think QE2 is a big mistake. US consumers have no purchasing power (aka Broke), this will only create a speculative bubble for trader.

So, My current stock holding (small position) is
FLIR (Flir System) - Defense
MCK  (Mckesson Corp) - Drug Service
URS (URS Corp) - Engineering Services
ACL ( Alcon) - Drug / Healthcare
MRK (Merck) - Drug /healthcare

Hedge:
SRS (Ultra Short REIT)
Long term:
JNK - Junk Bond
VMO - Muni Bond Closed End Fund (CEF)
VGM - Muni Bond Closed End Fund (CEF)
NZH - Muni Bond California CEF
FAM - Global Bond CEF
Cash -- Ton of them

Please trade responsibly!

Charles Schwab Online Brokerage Account Review

Charles Schwab is one of online brokerage site which offers financial service as well as a trading platform to buy online stock for its investors. Schwab also has over 300 local offices. They are able to offer a full range of banking, brokerage, and investment advisory services to their large client base. Other financial services include retirement planning, mutual fund trading, equity trading or stock trading, and financial planning. They are one of the largest financial brokers in the world with > 7.5 million accounts with customer assets in excess of $1.4 trillion. It also 11 Free commission ETFs for trade recently.

Schwab aka Chuck Details

As one of largest brokerage in the world, Charles Schwab was founded in 1971 as First Commander Corporation. The current headquarter is located at San Francisco, CA USA. Charles Schwab Corporation is a brokerage and banking company listed in NYSE with ticker: SCHW.

It currently uses its own clearing service to hold the client asset. Charles Schwab Clearing Services (CSCS), member of FINRA & SIPC, holds and clears all client trade. All Charles Schwab accounts are insured under SIPC up to $500,000 ($100,000 cash) and supplemental Lloyd’s of London coverage up to $150 million ($1 million cash).

Products: Stocks, bonds, mutual funds, options, CDs, insurance, annuities, foreign investments
Market Orders: $8.95 / trade
Limit Orders: $8.95 / trade

Auto Phone Orders: $13.95 / trade

Broker-Assisted Orders: $33.95 / trade

Schwab’s ETF Market/Limit Orders: $0.00

Mutual Funds: $49.95 & $0.00 for NTF funds.
Options: $8.95/trade+$0.75/contract
Minimum to Open: $1000 for US-based accounts, $25000 or $10000 for foreign accounts

Inactivity Fee: $0.00
Some Other Fees: Wire Transfer Outgoing: $25.00 per transfer. ACAT Out: $50.00.
Maximum Margin Rate: Based on proprietary base rate

Commission & Pricing

For stock or ETF order, the standard commission is $8.95 per trade with no limit of shares amount. As noted, for broker-assisted trades, the commission is $33.95 per order. When trading during pre and post market hours, there is no additional fees such as ECN fees.  Charles Schwab applies a simplified flat-fee based commissions structure. There is no catches or fine print notes for trading using Schwab. There are no limits on total trade size or price. If you are trading more than 10,000 shares or $500,000, you may be eligible for special handling and pricing.. 

Stock trading (i.e. buy stock online) can be done through web based platform as well as software platform, StreetSmart Pro. StreetSmart Pro is available to active trading customers.

For option, the customer can use their option platform thru web. The cost of 1 contract will cost $9.70 commission fee ($8.95 ticket fee + $0.75 per contract), while 10 contracts will cost $16.45 commission fee.

For mutual funds, there are about 1,900+ no load no transaction fee mutual funds with no commission fee for buy or sell through OneSource Funds. There are 3,000+ mutual funds for selection with $49.95 per trade of mutual funds.


Also featured in My Review of Charles Schwab Online Brokerage Account and ETF