Barrons: Vanguard Health Care Fund's 5-Year Average Return is +25.2% Per Year

Vanguard Health Care Fund Keeps Posting Healthy Profits

Vanguard's 10-Year Investment Forecast Predicts a +5.7% per Year Real Return

Excerpt:

"Vanguard predicts a most likely case of a +5.7% real annual returns for stocks, but other experts are more cautious.

In his new book, Rational Expectations, William J. Bernstein predicts a +2% real return for large-cap stocks and +3% for small-cap stocks over the next decade.

Rob Arnott, chairman of Research Affiliates, forecasts a +3% real return over the next decade."

My own opinion is that the future is even more uncertain than the ranges shown in the Vanguard model — especially on the downside.

And as I see it, the world is a less predictable place than ever before.

Read the entire report here...

Vanguard Capital Markets Model: 10-Year Investing Forecast

7 Conservative Funds for Seniors

The following list of balanced funds comes to us by way of SmartMoney.com.

The website analyzed data from Morningstar to find funds that were in the top 25% of their category in the last 3- and 5-year time periods.

Balanced funds haven’t been star performers of late; SmartMoney writes that the category is down -0.36%, while the S&P 500 is up +0.22%.

The funds on the list, though, are up +2.7%.

Among SmartMoney’s criteria for the list, these funds are open to new money, and the minimum investment is less than $5,000. Additionally, the annual expense ratio is under 1.5%.

1. Berywn Income
2. Hussman Strategic Total Return
3. James Balanced: Golden Rainbow
4. Mairs & Power Balanced
5. Permanent Portfolio
6. T. Rowe Price Capital Appreciation
7. Vanguard Wellesley Income

Pimco Convertible Bond Fund - Still Going Strong...

Chart courtesy of www.StockCharts.com

Convertible bond funds are one of our favorite low-risk, high-reward investments when the economy is emerging from recession.

And Pimco Convertible Fund (PFCAX) is our favorite convertible bond fund.

For active investors, I've found that selling the fund when it closes below its 13-week moving average (the blue line on the chart) at the end of the week (Friday close) and buying it when it closes above its 13-week moving average at the end of any week has kept us out of harm's way and has provided above-average returns with below-average risk relative to buying-and-holding the S&P 500.

This way we only have to check on the status of the fund over the weekend and don't have to monitor it every day of the week.

In 2009, PFCAX soared+44.73% and is up +10.0% in 2010 (thru 04/23/10).

PFCAX has remained above it's 13-week moving average on a weekly closing basis since Friday, May 22, 2009, capturing the lion's share of the move off of the March 2009 low.

FULL DISCLOSURE: We currently hold this fund in many of our managed accounts.

And, of course, past performance is no guarantee of future results.

Pimco Convertible: A Viable Substitute for Vanguard Convertible

Chart courtesy of www.StockCharts.com

In mid-June 2009, Vanguard closed Vanguard Convertible Securities Fund (VCVSX) to new accounts and placed an investment limit on current retail accounts.

Vanguard investors seeking a viable alternative can find a suitable substitute in the Pimco Convertible Fund (PFCAX).

For active investors, I've found that selling the fund when it closes below its 50-day moving average (the blue line on the chart) at the end of the week (Friday close) and  buying it when it closes above its 50-day moving average at the end of any week has kept us out of harm's way and has provided above-average returns relative to buying-and-holding the S&P 500.

This way we only have to check on the status of the fund over the weekend and don't have to monitor it every day of the week.

This year PFCAX is up +39.49% versus a +36.1% return for VCVSX (thru 11/18/09).

Since PFCAX closed above it 50-day moving average on Friday May 15, Pimco Convertible is up +33.4% versus only +25.7% for the S&P 500 and +20.6% for Vanguard Convertible.

FULL DISCLOSURE: We currently hold this fund in many of our managed accounts.

And, of course, past performance is no guarantee of future results.