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Author: Hawkwin Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75805  
Subject: Re: If I Were to Take Over from FA... Date: 3/14/2014 2:09 PM
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but until I see one who can show me the data saying they have exceeded Wellington net of fees for at least 5 year,

A bit of caution on such a claim.

It would be rather easy (for those with premium Morningstar access) to find an allocation or a fund that beat such net of fees. That does not necessarily mean that it is a good investment.

Even within Wellington's asset class, Morningstar has 25 other funds that beat it over the last five years.

Wellington is ranked #4 for the last 10 years though so no way to argue that it has not been a stellar performer.

Even though Wellington has done an outstanding job over the last 10 years, I do caution you on it in a rising interest rate environment. It does hold 1/3 of its assets in high quality, high duration bonds.

For every 1% increase in interest rates, the bond holdings in Wellington will lose 6% in value (Duration of 5.96 years). Additionally, the average price of their holdings is trading at over $104 - so even if they hold to maturity, those bonds are going to lose that $4 average premium in time.

Keep a close(r) eye on it in a moderately increasing interest rate environment.
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