I should have used comparable timeframes, yes. Thanks for the correction. It will be very interesting to me to see if this value index fund can continue to beat the S&P. And if not consistently (which I don't expect), at least over what timeframes it might be-- six months, a year, five years, etc.
And the reason I'm interested is because I continue to hold a large number of individual stocks -- more than anyone else I know. I believe that people sense I must get mediocre (i.e. just average)results, because with a large number of stocks eventually I must be mimicking the market, and getting what it gives. I don't believe that's necessarily so, or factually so in my case. Assuming it's accurate for me to say that most of my stocks are value stocks, then to me, if a fund like FVVAX consisting of almost 900 stocks ("weighted based on the Adviser’s assessment of a security’s fundamental value, based on factors such as earnings yield and return on capital")can do better over time (albeit maybe not consistently) than something like the usual mutual fund bogey of the S&P 500, then that's some actual evidence or possibility that performance doesn't have to degrade with increasing number of stocks held. Additionally, since there ought to be a consideration of risk vs. reward, the good results of the fund would be got with less risk than otherwise. (Because, of course, failure of a few companies in the fund aren't significant when so many other companies are being held.) I would like to believe that this reduction in risk is a benefit to me too given my large number of stocks. Although at this time I have high risk, since I'm sector concentrated -- heavily to oil related companies. |
