Does anyone hold Vanguard Windsor II or Wellington?

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water2357
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Does anyone hold Vanguard Windsor II or Wellington?

Post by water2357 »

Does anyone hold Vanguard WIndsor II? Now long have you had it? Why did you choose it?

Does anyone hold Vanguard Wellington? Now long have you had it? Why did you choose it?

Thanks, re-evaluating reasons for choosing certain Vanguard funds.
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Kenkat
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by Kenkat »

I held Windsor II for a long time starting in 1998. At that time, the index that the Vanguard Large Value Index fund used was not particularly good in my opinion since it was based on the S&P 500. Over time, Vanguard has utilized much better indexes overall and I switched this fund out for Vanguard Value Index several years ago as I believe this fund captures large value as well or better than Windsor II and at lower cost.
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water2357
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by water2357 »

Thanks, need to make some changes and good to have other viewpoints.
solarcub
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by solarcub »

I had all index funds in my IRAs and 401ks, so when I got enough money to start investing in taxable, I decided to go for the Wellington. I did not have any particular goal in mind for that money, so a balance of stocks and bonds seemed like a good idea; more growth than bonds and more stability than stocks. I also thought of the active management as a bit of a hedge against "what if indexing is wrong"?

Now that my holdings have grown over the last 20 years, I am moving away from the Wellington because the dividends and capital gains annoy me when it comes to tax time. I wish I had a 70/30 split using index funds instead.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by PinotGris »

solarcub wrote: Sun Apr 18, 2021 2:41 pm
Now that my holdings have grown over the last 20 years, I am moving away from the Wellington because the dividends and capital gains annoy me when it comes to tax time. I wish I had a 70/30 split using index funds instead.
Exactly. I held a large amount for a long time in the wrong account - Taxable. This was before I discovered Boglehead and had an understanding of asset allocation. I am liquidating it slowly, diverting all distributions to cash, setting off against TLH from other holdings, and I like how my taxable income is more in control now. I may be gifting the shares to my kids, not sure how that will work.
I think it is a great fund, but expensive compared to other VG funds. I think it is best to hold just equity or just bond funds instead of this mix of stuff, and keep everything clean.
Last edited by PinotGris on Sun Apr 18, 2021 3:15 pm, edited 1 time in total.
tibbitts
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by tibbitts »

solarcub wrote: Sun Apr 18, 2021 2:41 pm ... I decided to go for the Wellington...
There has to be a reason why everybody throws "the" in front of Wellington, and not any other mutual fund that I've noticed. It ranks up there in curiosity along with why everybody switched from using "diversification" to "diversity."
tibbitts
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by tibbitts »

I've held both funds in the past; Wellington until very recently. I exchanged out of it because I moved all my conventional bonds (such as included in Wellesley and Wellington) to TIAA Traditional, so now I'm only left with high-yield, emerging market, and floating-rate bonds.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by sycamore »

tibbitts wrote: Sun Apr 18, 2021 3:13 pm
solarcub wrote: Sun Apr 18, 2021 2:41 pm ... I decided to go for the Wellington...
There has to be a reason why everybody throws "the" in front of Wellington, and not any other mutual fund that I've noticed. It ranks up there in curiosity along with why everybody switched from using "diversification" to "diversity."
Not mention why everybody says “everybody does X” when plainly not everybody does that ;-)

For the record I don’t hold Wellington but if I did it would be because I wanted some “active management” exposure at a reasonably low cost.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by KlangFool »

OP,

40% of my portfolio is in the Wellington Fund. I want some "active management" of my stock and bond to protect myself from time when passive index failed.

KlangFool
40% VWENX | 12.5% VFWAX/VTIAX | 11.5% VTSAX | 16% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 40% Wellington 40% 3-funds 20% Mini-Larry
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by UpperNwGuy »

I gave serious consideration to both these funds when I started investing, and I rejected them because the fees were higher, they were actively managed, and, in the case of Wellington, bonds and stocks are held in the same fund.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by Ed 2 »

water2357 wrote: Sun Apr 18, 2021 12:22 pm Does anyone hold Vanguard WIndsor II? Now long have you had it? Why did you choose it?

Does anyone hold Vanguard Wellington? Now long have you had it? Why did you choose it?

Thanks, re-evaluating reasons for choosing certain Vanguard funds.
My kids college accounts (ESA)are in Wellington funds since they were born and I was happy with . Main point Wellington fund is ideal for shorter time horizon like college funds and tax deferred accounts. Year end Capital gains are big and it’s not appropriate for taxable accounts for those with high tax bracket and high savers.
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Jerry55
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by Jerry55 »

My Federal TSP has my index funds (80% C, 10% each Small cap and International), and is the majority of my holdings (~70-75%) but I needed to make a move for my taxable savings.
The opportunity came about when I decided to open a "Voluntary Contribution Plan" (available to CSRS employees and maybe CSRS Offset) since it's already taxed money, and open a Mega-Roth via that avenue. One can contribute up to 10% of an employees lifetime earnings in one fell swoop, which I did. So, I moved most of my savings to the VCP, then converted that into mainly Wellesley ROTH Ira, but I decided to move about 25% of that total into Wellington as a counter-balance.
In essence, I put 125K into Wellesley, and 50K into Wellington, which has equaled, or slightly surpassed Wellesley since 2011.
I never took anything out of either fund, but last year, decided to take quarterly dividends from Wellington and got a huge surprise last December when the LT / ST capitol gains exceeded 7K...as it's normally half of that at best.

Taxable of course, but I don't mind paying tax on money I received.
Wellington and Wellesley will stay put. I retired at 57, just turned 66 and hope to leave it to my heirs, in addition to my TSP for the most part.

I'm very happy with their performance. They're doing what I expected them to do. No need to shoot for the moon. My TSP is doing that.
Retired CSRS on 12/19/2012 @ age 57 w/39 years | Good Bye Tension, Hello Pension !!!
BillWalters
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by BillWalters »

I have Wellington in a rollover IRA, have been pleased.
jchris
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by jchris »

I've held Windsor II since about 1989. I bought it when I was just first starting to learn about mutual fund investing and a buddy had recommended Vanguard funds, and I think I read an article about the success of the original Windsor fund. Anyway, I put several thousand in it back then and never contributed another cent because shortly thereafter I learned about index funds and realized I probably should be investing in those. I would not recommend investing in it today - expense ratio is too high and it spins off way too many dividends and cap gain distributions. Hurts at tax time. I still hold it because it is majority capital gains from those original few thousand invested and i would take a big tax hit to sell it. We are trying to keep our income below the AOTC threshold while youngest finishes college - after that I will probably dump it and buy toys.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by tibbitts »

sycamore wrote: Sun Apr 18, 2021 5:00 pm
tibbitts wrote: Sun Apr 18, 2021 3:13 pm
solarcub wrote: Sun Apr 18, 2021 2:41 pm ... I decided to go for the Wellington...
There has to be a reason why everybody throws "the" in front of Wellington, and not any other mutual fund that I've noticed. It ranks up there in curiosity along with why everybody switched from using "diversification" to "diversity."
Not mention why everybody says “everybody does X” when plainly not everybody does that ;-)

For the record I don’t hold Wellington but if I did it would be because I wanted some “active management” exposure at a reasonably low cost.
Valid point, but I'm fairly convinced that both of those conventions are extremely common now vs., say, in the Diehard or very early Boglehead forum eras.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by Rudedog »

I have held Wellington in rollover IRA for over ten years, I like it because (1) I like the active management, (2) its pretty stable, I generally don't see wild swings, (3) since its in rollover IRA the dividends and capital gains are reinvested.
Topic Author
water2357
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by water2357 »

Thanks for the comments. Need to take a look at Vanguard holdings for taxable and nontaxable and the additional perspective helps.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by DB2 »

I've been considering adding a piece of Vanguard active mgt to my portfolio which focuses on large cap value. Global Wellington as an option (I like having some international diversity) however, the fund it holds 5.5% in cash reserves (seems a bit excessive to me) and not sure I want all of the bond allocation although I still want some.

Now, Windsor is partially managed by Wellington and is 100% equity and it says it may invest up to 30% in international. Windsor II seems too FAANG heavy in its top 10 for my liking.

I am thinking more and more about Windsor to complement my Total World Market index holding.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by stan1 »

Would I buy it today in a retirement account? Probably not.
Would I buy it in a taxable account? Absolutely not.

If I had held it for decades in an IRA or 401K account would I change anything? Probably not.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by m@ver1ck »

I’ve got around 250K (out of 200K) of my portfolio in Wellington and Golbal Wellington combined.
Wellington as a counter balance to some fidelity f
Growth funds I have. Global Wellington since I don’t trust VTIAX.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by VtsaxParade »

I put 100% of my Roth IRA in Wellington. I picked it because sheltering bonds from taxes seems good, I don't really understand bonds very well so having them be actively managed seems fine, the historic returns and fees seem solid, and this will be one of the first accounts I draw from in like 10 years, so having it in a 'balanced fund' makes a lot of sense to me.

My wife's Roth IRA is in Star (vgstx) for similar reasons. You could go with the passive balanced fund (vbiax) as well. All 3 have been similar over time despite the strategies being quite different.

I've been happy with both wellington and star (star contains windsor 2). Wellington was overperforming for awhile, star had a really nice couple years, and now they seem to be converging again. Realistically I could have just vtsaxd both accounts but it doesn't really matter all that much to me and I like having a simple plan instead of worrying about when or how to switch those accounts into something more conservative.
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Metsfan91
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by Metsfan91 »

I have wellington fund in taxable. It is actively managed fund, and it has a long history of doing well. I first acquired in mid 2000's.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by dbr »

Rather than thinking active management would help manage risk I would have said that active management is an additional risk factor.

Opinions may vary.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by tibbitts »

Metsfan91 wrote: Sun May 09, 2021 1:28 pm I have wellington fund in taxable. It is actively managed fund, and it has a long history of doing well. I first acquired in mid 2000's.
It would have taken a lot of determination to hold on through its wild ride in the '60s and early '70s. I'm pretty sure I would have bailed.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by stan1 »

Metsfan91 wrote: Sun May 09, 2021 1:28 pm I have wellington fund in taxable. It is actively managed fund, and it has a long history of doing well. I first acquired in mid 2000's.
The capital gains distributions and non-qualified dividends would upset me greatly each year when I was doing my tax return, but to each their own I guess. Knowing what I know today I would buy ETFs (or Vanguard funds with an ETF share class) and hold corporate bonds in tax deferred accounts. I did buy PRIMECAP in taxable in the early 2000s before I knew better (now sold).

I do agree that if I wanted an actively managed balanced fund in my IRA Wellington would be the first I turned to. One could do much, much worse.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by GaryA505 »

I think Wellington is a good choice for a 60/40 fund with a slight value tilt. I own some.
Windsor is a large cap value bet with very rocky ride. IMO, on a risk-adjusted basis I would take Wellington over Windsor without much thought.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by tibbitts »

GaryA505 wrote: Sun May 09, 2021 1:55 pm I think Wellington is a good choice for a 60/40 fund with a slight value tilt. I own some.
Windsor is a large cap value bet with very rocky ride. IMO, on a risk-adjusted basis I would take Wellington over Windsor without much thought.
But they don't compete with each other, and you'd expect all-equity to give a rockier ride. I will say that it was tough sticking with Windsor through the later Neff years - especially if you hadn't been along for all those previous years of outstanding performance.

I think almost everyone agrees that none of this stuff belongs in taxable.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by dbr »

tibbitts wrote: Sun May 09, 2021 2:03 pm
GaryA505 wrote: Sun May 09, 2021 1:55 pm I think Wellington is a good choice for a 60/40 fund with a slight value tilt. I own some.
Windsor is a large cap value bet with very rocky ride. IMO, on a risk-adjusted basis I would take Wellington over Windsor without much thought.
But they don't compete with each other, and you'd expect all-equity to give a rockier ride. I will say that it was tough sticking with Windsor through the later Neff years - especially if you hadn't been along for all those previous years of outstanding performance.

I think almost everyone agrees that none of this stuff belongs in taxable.
This would be an example of management adding risk -- in one period returns vary upward and then change a lot and end up negative relative to the S&P 500, so returns are more variable than they should be.

Between 2002 and 2021 the Sharpe ratio of VWNEX has been .47 while the Vanguard TSM has been .60. That data is not from the Neff years.
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Metsfan91
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by Metsfan91 »

stan1 wrote: Sun May 09, 2021 1:44 pm
Metsfan91 wrote: Sun May 09, 2021 1:28 pm I have wellington fund in taxable. It is actively managed fund, and it has a long history of doing well. I first acquired in mid 2000's.
The capital gains distributions and non-qualified dividends would upset me greatly each year when I was doing my tax return, but to each their own I guess. Knowing what I know today I would buy ETFs (or Vanguard funds with an ETF share class) and hold corporate bonds in tax deferred accounts. I did buy PRIMECAP in taxable in the early 2000s before I knew better (now sold).

I do agree that if I wanted an actively managed balanced fund in my IRA Wellington would be the first I turned to. One could do much, much worse.
I use Wellington fund for my emergency fund. For 2020, I had 0 short term capital gains. There was only long term capital gains. I was surprised.

I buy mutual funds only. Never bought ETF. Bid-sell spread and price flactuation during the day hold me back.
“Time is your friend; impulse is your enemy.” — John C. Bogle
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by TomatoTomahto »

m@ver1ck wrote: Sun May 09, 2021 12:40 pm I’ve got around 250K (out of 200K) of my portfolio in Wellington and Golbal Wellington combined.
I don’t have any Wellington, but if I could manage your trick (250k of 200k), I would reconsider. :D
I get the FI part but not the RE part of FIRE.
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Re: Does anyone hold Vanguard Windsor II or Wellington?

Post by m@ver1ck »

TomatoTomahto wrote: Sun May 09, 2021 2:32 pm
m@ver1ck wrote: Sun May 09, 2021 12:40 pm I’ve got around 250K (out of 200K) of my portfolio in Wellington and Golbal Wellington combined.
I don’t have any Wellington, but if I could manage your trick (250k of 200k), I would reconsider. :D
Doh! I meant 250K out of 2M.
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