PEOPX Index fund not so indexed?

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pszalapski
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PEOPX Index fund not so indexed?

Postby pszalapski » Thu Apr 26, 2007 3:02 pm

Didn't know of a better place to post this, so I hope this is the right kind of post for this forum.

PEOPX is supposed to be an S&P500 index fund, so what's up with the big drop on Dec 28, 2006? The S&P didn't drop, but this fund did--and it's stayed down ever since. Did the fund manager get a hot tip, lose a few hundred million, and then the board slapped him and got back to being an index fund? This doesn't make any sense to me, especially because I own PEOPX! Any one have any ideas?

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MossySF
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Postby MossySF » Thu Apr 26, 2007 4:09 pm

That chart only shows share price -- not total return. If you include the dividends + capital gains distributions, the numbers will match up perfect. Of course, the leads to the question of why there are capital gains. For a retirement account, it doesn't matter because all gains are deferred -- the price lowers but you get more shares. It's still puzzling though. Looking at Dreyfus' website, I see they have 2 S&P500 funds:

DSPIX - 0% cg distributions
PEOPX - 3.33% cg distributions

Perhaps Dreyfus lost a big institutional customer forcing shares to be liquidated and posted as capital gains? Not enough money to fully track the index? Dunno.

pszalapski
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Postby pszalapski » Fri Apr 27, 2007 8:12 am

MossySF wrote:That chart only shows share price -- not total return. If you include the dividends + capital gains distributions, the numbers will match up perfect. Of course, the leads to the question of why there are capital gains. For a retirement account, it doesn't matter because all gains are deferred -- the price lowers but you get more shares. It's still puzzling though. Looking at Dreyfus' website, I see they have 2 S&P500 funds:

DSPIX - 0% cg distributions
PEOPX - 3.33% cg distributions

Perhaps Dreyfus lost a big institutional customer forcing shares to be liquidated and posted as capital gains? Not enough money to fully track the index? Dunno.

I see. I own both of the above funds, and I never knew why DSPIX had a .2% ER and PEOPX had a .5% ratio. Although it doesn't seem like distributions make a fund better or worse, so I'm sure I would prefer DSPIX to PEOPX.

cswiii
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Postby cswiii » Mon Apr 30, 2007 9:22 am

You probably don't need to own both. Generally speaking,one reason people shuffle mutual fund portfolios is because there's too much overlap between their funds. Here, you've got two index funds. Assuming they are within the same portfolio -- and perhaps even if they aren't -- I don't think there's a need to hold two diff index funds. And .5% does seem like a lot for passive management. I pay only a hair more than that for my DODGX!
I'm not a financial analyst. If you ask for opinions, I may weigh in, but don't construe my comments as advice. Do your own due diligence and/or speak with your financial adviser.

pszalapski
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Postby pszalapski » Mon Apr 30, 2007 9:38 am

cswiii wrote:You probably don't need to own both. Generally speaking,one reason people shuffle mutual fund portfolios is because there's too much overlap between their funds. Here, you've got two index funds. Assuming they are within the same portfolio -- and perhaps even if they aren't -- I don't think there's a need to hold two diff index funds. And .5% does seem like a lot for passive management. I pay only a hair more than that for my DODGX!

I have it this way because PEOPX is the only index fund available in my 401k. Right now, I'm contributing to my IRA about as much as my 401k. Should I ditch PEOPX and stick just with the managed funds in my 401k, discussed in this thread? In that case, I'd stick with DSPIX in the IRA as about 30% of my portfolio I'd like to retire in 25 years.[/url]
Can anyone answer my last question, above? Thanks.


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