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Please upgrade your browser to improve your experience. Of course, the index funds of this venerated family are legendary. But here are our favorite actively managed picks. HuangSenior Associate Editor December 12, Vanguard is best-known for its index funds.

And lately, many of them have outpaced their benchmarks. The Best Fidelity Mutual Funds. All returns are through December Vanguard Dividend Growth VDIGX. At Dividend Growth, a member of the Kiplinger 25, manager Don Kilbride prefers to invest in companies that consistently raise their dividends instead of firms that pay the highest yields.

Take Nike, the sportswear apparel company. It yields just 1. Similarly, Diageo, the beverage and spirits company based in the U. Dividend stocks outpaced the market in and as investors sought stability during a volatile period that was marked by worries about a global meltdown, a struggling U.

As those fears have subsided, investors have shifted their attention from the solid dividend payers to other pockets of the market. Still, Kilbride does a solid job of homing in on quality companies. Vanguard Explorer Value VEVFX.

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Vanguard never had an actively managed fund that focused on small and midsize companies until it launched Explorer Value in March Three firms—Cardinal Capital Management, in Greenwich, Conn. But there is little overlap in the portfolio among the three so-called sleeves.

That is because each firm has its own strategy for picking stocks. Timothy Beyer and Eduardo Brea at Sterling are value managers with a focus on traditional measures, such as price to book value assets minus liabilities and price to earnings. Eugene Fox, Robert Kirkpatrick and Amy Minella at Cardinal combine quantitative measures with dig-down-deep analysis to find companies with strong balance sheets and growing earnings that are trading at a discount.

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You diversify the stock-selection risk. So far, so good. It was less volatile than the benchmark over that period, too. To keep a lid on assets, you can only buy shares in this fund through Vanguard.

Vanguard International Growth VWIGX. She left in October to join Pimco. But Vanguard funds to buy now Webber, her co-manager on the fund sinceremains at the fund.

Vanguard likes to parcel out portions of big funds to different firms. Vanguard Selected Value VASVX Two firms share management duties at this midsize-company fund, which is a member fha earnest money deposit the Kiplinger Jim Barrow has been a manager with Selected Value since ; Mark Giambrone has been a co-manager since Both firms troll for high-quality midsize companies that trade at bargain today exchange rate usd vs inr, but they go about it in different ways.

At Barrow, Hanley, the managers tilt toward out-of-favor companies with a catalyst that will turn the business around. But the stock has to trade at a bargain level as measured by price to earnings, price to book value assets minus liabilities and dividend yield. In the end, Barrow and Giambrone typically invest in highly profitable companies with strong balance sheets and good cash flow earnings plus depreciation and other noncash charges.

Smith and Greenberg like high-quality companies, too. It takes into account book value but also subtracts intangible assets, such as goodwill, leases, franchises, and export and import permits. Since Smith and Greenberg joined the fund inSelected Value has returned 9. Vanguard Short-Term Investment-Grade VFSTX. This fund, a member of the Kiplinger 25has a simple mandate: Cash offers basically nil, and one-year and five-year Treasury notes were yielding 0.

Short-Term Investment Grade currently yields 1.

The portfolio has an average maturity of three years, and its average duration is two years. In the five-plus years since he took the helm in midmanager Greg Nassour has returned 3. Vanguard Wellington closed to new investors.

For the same reason, we also dropped Vanguard Wellesley Income VFINXa balanced fund that tilts more toward bonds than to stocks. Toggle navigation Menu Subscribers Log In. Sections Close Menu Wealth Creation Investing Retirement Taxes Your Money Your Business Magazine Contents.

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