William Blair Low Duration I (WBLIX)
Expense Ratio: 0.55%
Expected Lifetime Fees: $17,164.20
The William Blair Low Duration I fund (WBLIX) is a Ultrashort Bond fund started on 12/1/2009 and has $180.40 million in assets under management. The current manager has been running William Blair Low Duration I since 12/22/2009. The fund is rated by Morningstar. This fund does not charge 12b-1 fees.
SPDR Barclays Capital 1-3 Month T-Bill (BIL)
Expense Ratio: 0.15%
Expected Lifetime Fees: $4,881.99
The SPDR Barclays Capital 1-3 Month T-Bill (BIL) is an Exchange Traded Fund. It is a "basket" of securities that index the Ultrashort Bond investment strategy and is an alternative to a Ultrashort Bond mutual fund. Fees are very low compared to a comparable mutual fund like William Blair Low Duration I because computers automatically manage the stocks.
|Mutual Fund Name||Ticker Symbol||Turnover||Assets (M)||Annual Fees|
|DFA One-Year Fixed-Income I||DFIHX||78.0%||7,500||0.17%|
|Federated Gov Ultrashort Duration Instl||FGUSX||26.0%||843||0.25%|
|Federated Gov Ultrashort Duration InSvc||FEUSX||26.0%||843||0.35%|
|Federated Ultrashort Bond Instl||FULIX||38.0%||1,500||0.38%|
|Fidelity Advisor Ultra Short Bond I||FUBIX||103.0%||319||0.49%|
|Fidelity Ultra-Short Bond||FUSFX||103.0%||319||0.45%|
|Goldman Sachs Enhanced Income Instl||GEIIX||86.0%||506||0.29%|
|Goldman Sachs Ultra-Short Dur Gov I||GSARX||178.0%||280||0.40%|
|Metropolitan West Ultra Short Bond I||MWUIX||29.0%||112||0.36%|
|Metropolitan West Ultra Short Bond M||MWUSX||29.0%||112||0.52%|
|Northern Ultra-Short Fixed Income Fund||NUSFX||46.0%||468||0.25%|
|Payden Limited Maturity||PYLMX||75.0%||223||0.50%|
|PIA Short Term Securities Adv||PIASX||11.0%||169||0.35%|
|PIMCO Short-Term Instl||PTSHX||307.0%||10,900||0.45%|
|RidgeWorth Ultra-Short Bond I||SISSX||97.0%||105||0.32%|
|RidgeWorth US Gov Sec Ultra-Short Bd I||SIGVX||70.0%||2,100||0.33%|
|Wells Fargo Advantage Adj Rate Govt I||EKIZX||18.0%||1,400||0.49%|
|Wells Fargo Advantage Ultra S/T Inc I||SADIX||60.0%||1,200||0.36%|
|William Blair Low Duration Inst||WBLJX||43.0%||180||0.40%|
Turnover represents how much of a mutual fund's holdings are changed over the course of a year through buying and selling. Active mutual funds have an average turnover rate of about 85%, meaning that funds are turning over nearly all of their holdings every year. A high turnover means you could make lower returns because: 1) buying and selling stocks costs money through commissions and spreads and 2) the fund will distribute yearly capital gains which increases your taxes. Look for funds with turnover rates below 50%. For comparison, ETF turnover rates average around 10% or lower.
Generally, smaller funds do better than larger ones. The more assets in a mutual fund, the lower the chance that it will beat its index. Managers outperform an index by choosing stocks that are undervalued. In order to find these undervalued stocks, the manager has to know more than his competitors to develop an "edge." There are only a finite number of stocks a mutual fund manager can reasonably analyze and actively track to gain such a competitive edge. When the fund has more assets, the manager must analyze large companies because he needs to take larger positions. Large companies are more efficiently priced in the market and it becomes increasingly difficult to get an edge.