Very interesting and boring mutual fund!

behaviorkeltonNovember 18, 2007

I've been looking for a mutual fund with low expenses, doesn't have a trading fee (my brokerage), has a value bias, and is as much like a index fund as possible. Index funds typically have a trading fee when bought through a brokerage.

This makes it somewhat expensive when you can't "dollar cost average" without incurring a trading fee with each transaction.

So here's the mutual fund: LEXCG Corporate Leaders Trust

It's owned by ING and has been around since the 30's. It holds 20-something stocks from the DOW and it has been doing OK in up markets and pretty good in down markets... so it has been a rather stable/low risk fund.

Morningstar ranks it highly if that means anything.

The fees are under .59%

$1000 minimum initial investment with $50 minimum thereafter.

I've heard of many of the other major index's and low cost mutual funds, but have never heard of this one.

Anyone ever heard of this?... there is very little info and discussion of this fund on the web.

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alphacat

The ticker symbol is LEXCX, not LEXCG. It's a large-cap value fund and seems to perform much like other large-cap value funds. For example, when compared with VIVAX (Vanguard's large-cap value fund) over the past 10 years (plus YTD 2007), LEXCX outperformed VIVAX in 6 of those 11 periods and VIVAX outperformed LEXEX in 5 of them.

If you had invested $1,000 in VIVAX at the beginning of 1997, you would have $2,640 today. If you had invested in LEXCX instead, you would have $2,818. Essentially all of that difference was accounted for by this year -- at the beginning of 2007 your $1,000 would have grown to $2,472 for VIVAX or $2,474 for LEXCX.

So I don't think there's any obvious reason to believe that LEXCX will be significantly better than any other large-cap value fund in the future, or that it won't.

    Bookmark   November 19, 2007 at 10:06AM
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behaviorkelton

Thanks.

The key feature that I found missing in the brokerage was that it was difficult to find a conservative stock fund that
a) didn't have high fees
b) didn't require high initial investments
c) *did't* have a transaction fee...usually ~$20 every time you buy more shares!

For whatever reason, this simple index-like fund is able to have both low operating fees *and* no trading fee.

Janus seems to be "ok" with regard to fees as well. I was looking at their growth and income fund. It seems to cover many bases...including 20+% exposure to the international market.

I'm still trying to decide.

As I try to gradually buy more shares as this market slips, I'm not so sure I want the fund manager changing strategies mid-stream...so I tend to favor funds with low turnover and minimal "management".

Of course, I'm only guessing that the market is going to turn down at least for a bit. I have bought in "up" markets and was burned, so now I'm going to try buying...over time... while everyone is running for the hills!

    Bookmark   November 19, 2007 at 1:17PM
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alphacat

Is there a reason you have to buy it through a brokerage? As an example, if you buy a Vanguard mutual fund directly through Vanguard, the initial balance is $3,000 for most funds, you can buy additional increments of as little as $100, and there are no other fees as long as you get your monthly statements online.

    Bookmark   November 20, 2007 at 5:35PM
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