JPMorgan Treasury & Agency Select (OGTFX)
Expense Ratio: 0.45%
Expected Lifetime Fees: $14,191.30
The JPMorgan Treasury & Agency Select fund (OGTFX) is a Short Government fund started on 01/20/1997 and has $369.90 million in assets under management. The current manager has been running JPMorgan Treasury & Agency Select since 02/11/1997. The fund is rated by Morningstar. This fund does not charge 12b-1 fees.
iShares Barclays Short Treasury Bond (SHV)
Expense Ratio: 0.14%
Expected Lifetime Fees: $4,561.33
The iShares Barclays Short Treasury Bond (SHV) is an Exchange Traded Fund. It is a "basket" of securities that index the Short Government investment strategy and is an alternative to a Short Government mutual fund. Fees are very low compared to a comparable mutual fund like JPMorgan Treasury & Agency Select because computers automatically manage the stocks.
| Mutual Fund Name | Ticker Symbol | Turnover | Assets (M) | Annual Fees |
|---|---|---|---|---|
| American Century Short-Term Govt Instl | TWUOX | 139.0% | 806 | 0.36% |
| DFA Short-Term Government I | DFFGX | 64.0% | 1,500 | 0.20% |
| Federated US Govt 1-3 Yr Y | FSGTX | 171.0% | 449 | 0.30% |
| Fidelity Spartan S/T Tr Bd Idx Fid Advt | FSBAX | 57.0% | 780 | 0.10% |
| Fidelity Spartan S/T Tr Bd Idx Inv | FSBIX | 57.0% | 780 | 0.20% |
| Northern Short-Intermediate US Govt | NSIUX | 1.0% | 287 | 0.43% |
| Vanguard Short-Term Federal Adm | VSGDX | 411.0% | 5,800 | 0.10% |
| Vanguard Short-Term Federal Inv | VSGBX | 411.0% | 5,800 | 0.20% |
| Vanguard Short-Term Govt Bd Idx Signal | VSBSX | 69.0% | 237 | 0.14% |
| Vanguard Short-Term Treasury Adm | VFIRX | 302.0% | 6,400 | 0.10% |
| Vanguard Short-Term Treasury Inv | VFISX | 302.0% | 6,400 | 0.20% |
| Wells Fargo Advantage Sh Dur Govt Bd I | WSGIX | 485.0% | 1,600 | 0.43% |
Turnover
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.
Assets
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.
