HSA and Roth IRA

Chadx

Level 2 Member
Hello,

I have invested in IVV for my HSA and Roth which I have seen here recommended. What are your thoughts on DVY ETF and FRESX?

Regards,

Chad
 

volker

Level 2 Member
DVY (iShare Select Dividend EFT) has a 0.39% fee and aligns more or less the curves of the S&P 500 (with plus and minus on both sides). S&P500 beat it over the last 10yrs, breaks even with it in the last 5yrs (where it was most times slightly above DVY) while the DVY beats the S&P500 in the last year.

Fees could be worse, but also not superb, assuming you diversify your portfolio with index funds and you think that the DVY will outperform these index funds in the future -- hence you justify the premium fee compared with the S&P500 VOO EFT which comes with a 0.05% fee. On the other side VYM (Vanguard High Yield Dividend, 0.09% fee) outperforms DVY over the last 10 years and comes with a smaller fee while VDGIX (Vanguard Dividend Groth Fund, no EFT found, 0.33% fee) outperforms all of them. But didn't compared all of them after factoring in the fee.

FRESX (0.78% annual fee, Fidelity Real Estate Investment Portofolio) is over the last 10years outperformed by VNQ (0.12% fee, Vanguard REIT EFT) and also in the last 12months (too short of a time frame), but not in the last 5years. Over the last 5years the FRESX gained ~15% over the VNQ. I personally don't like such high fees and would not trust past performance. In this case the lower fee EFT outperforms over the long term (10yrs) and even short term (1yr) which even rules out the time frame where the FRESX was outperforming. The Fidelity chart (https://fundresearch.fidelity.com/mutual-funds/summary/316138205) claims that the FRESX outperforms the other options, but it does not compare them after subtracting the fees -- and also doesn't compare it with other competitor funds.

In general it would be helpful writing down the kind of stock & fees and maybe a link to them.

My personal approach is always to compare the various funds and compare them with a) the S&P500 and Rusell 3000 as well as b) with similar funds in its class. All comparison over multiple multi-year time frames. I also try to avoid higher fees (every one has their own definition, for some its >1%, while mine is >0.3-0.4% or even >0.1% if it's an index fund) since no one knows if the fund will outperform in the future (even then the fee will often eat it).
 

Matt

Administrator
Staff member
Hello,

I have invested in IVV for my HSA and Roth which I have seen here recommended. What are your thoughts on DVY ETF and FRESX?

Regards,

Chad
You can't just cherry pick a fund.

It's like saying, I bench presses, what do you think about bicep curls?

Bicep curls are great, but you need legs, core, cardio.

Each fund needs to interplay with one another and fit into your overall strategy for saving.
 
while VDGIX (Vanguard Dividend Groth Fund, no EFT found, 0.33% fee) outperforms all of them.
VIG is the Vanguard dividend growth ETF. 0.09% expense ratio.

@Chadx as @Matt points out there's no way to pick "the best"/"good"/"bad" funds to invest in without knowing your investment objectives. Besides that, @volker is exactly correct: once you've identified the funds you want (small cap/mid-cap/large-cap/total market/high-dividend/dividend-growth) select the lowest-cost funds available (usually but not always Vanguard).

Few starter questions: what's your investment horizon, what's your reason for investing in ETF's, and under what circumstances will you panic and sell at the bottom?
 

Chadx

Level 2 Member
Hello,

The question was just a basic what do you think about the two items. In reading the boards in the past I came across the IVV post, and did not know about low expense ratio for IVV which I added to my portfolio and I am quite happy with the outcome.

I have a divest portfolio that I have been "working on", for the past 20 years. In that time I have contributed the maximum amount to my 401k, and for a shorter bit of time maxing out my IRA. With those investments I also have a pension and company stock in my portfolio.

My investment time horizon is long term, more than 20 years. I started investing in ETF's for the low expense ratio. I don't panic on investing or just about anything in my life, I am able to separate my emotions from my objectives.

Thanks again for all of the replies. Since investing is not my full time job I appreciate others point of view to add to my research. I am not looking for a hot stock quick gain, I am looking at other items that I currently do not have in my investment strategy.

Regards,

Chad
 

Matt

Administrator
Staff member
The question was just a basic what do you think about the two items.
I don't think either are necessary investments. I would stick to broader index tracking options that cost less and have less risk.
 
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