ProFunds 2017 YTD returns...

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skiehawk11
Posts: 2116
Joined: Wed Jan 05, 2011 2:32 pm

Re: ProFunds 2017 YTD returns...

Post by skiehawk11 »

TSPBuilder,

My point is that 18% returns are achievable on a short term basis with less fees and with more options and more liquidity than ProFunds. I'm not leaving money on the table. I'm leaving it in my pockets. :)

TSPBuilder
Posts: 256
Joined: Tue Jun 19, 2012 2:14 pm

Re: ProFunds 2017 YTD returns...

Post by TSPBuilder »

TSPTiming wrote:TSPBuilder,

Skiehawk is correct about the very high expense fees for Profunds. They are being sucked out of your account every day you own the funds, but if you are doing the type of short-term trading you describe of risky funds it doesn't matter much.

Expense fees are commonly misunderstood. Here's an explanation:
https://www.thestreet.com/story/729472/ ... ssets.html


Like it says in the prospectus under fees on page 81, the fees are waived and as I say they are therefore moot and not a consideration. There are also no fees listed on my statements except the IRA maintenance. Also, with over 62% and 68% highs the past two years, I can suck up the fees without too much disgruntlement.

We each have our own way. I come but to bring the information in the hopes of helping the 1% of the 1% become financially independent earlier in the curve.

Live long and prosper dudes and dudettes :)

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AventadorS
Posts: 10
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Re: ProFunds 2017 YTD returns...

Post by AventadorS »

TSPBuilder wrote:
TSPTiming wrote:TSPBuilder,

Skiehawk is correct about the very high expense fees for Profunds. They are being sucked out of your account every day you own the funds, but if you are doing the type of short-term trading you describe of risky funds it doesn't matter much.

Expense fees are commonly misunderstood. Here's an explanation:
https://www.thestreet.com/story/729472/ ... ssets.html


Like it says in the prospectus under fees on page 81, the fees are waived and as I say they are therefore moot and not a consideration. There are also no fees listed on my statements except the IRA maintenance. Also, with over 62% and 68% highs the past two years, I can suck up the fees without too much disgruntlement.

We each have our own way. I come but to bring the information in the hopes of helping the 1% of the 1% become financially independent earlier in the curve.

Live long and prosper dudes and dudettes :)


The sky high expense fees are ridiculous. Not sure why anyone would pay that kind of money for mediocre results.

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sonofnthng
Posts: 273
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Re: ProFunds 2017 YTD returns...

Post by sonofnthng »

So are there fees or not? Sounds like OP is trying to sell a product, because why work so hard to convince others to jump onto your ship? Who cares what anyone else is doing, if you are achieving results to your satisfaction.
So, out of sheer confusion and curiosity, are there fees or not? Please provide a source.
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heckrules
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Re: ProFunds 2017 YTD returns...

Post by heckrules »

TSPBuilder wrote:
TSPTiming wrote:TSPBuilder,

Live long and prosper dudes and dudettes :)



Sounds like they want to "live long and prosper" without cheesy sales pitches and high fees....

TSPBuilder
Posts: 256
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Re: ProFunds 2017 YTD returns...

Post by TSPBuilder »

sonofnthng wrote:So are there fees or not? Sounds like OP is trying to sell a product, because why work so hard to convince others to jump onto your ship? Who cares what anyone else is doing, if you are achieving results to your satisfaction.
So, out of sheer confusion and curiosity, are there fees or not? Please provide a source.


sonofnthng,

if you go to pg.81 of the prospectus there should be a section for the fees for the Ultra Latin Fund that I normally use and at the bottom of the paragraph it tells you that the fees are waived. That, in combination with actual statements, is the proof that there are no fees (with the exception of the previously mentioned IRA maintenance fee of $15/yr).

Viper
Posts: 12
Joined: Mon Jan 30, 2017 9:47 pm

Re: ProFunds 2017 YTD returns...

Post by Viper »

sonofnthng wrote:So are there fees or not? Sounds like OP is trying to sell a product, because why work so hard to convince others to jump onto your ship? Who cares what anyone else is doing, if you are achieving results to your satisfaction.
So, out of sheer confusion and curiosity, are there fees or not? Please provide a source.


YES there are FEES. Sky high fees in fact. Don't fall for this bait and switch tactic. You can do far better on your own.

TSPBuilder
Posts: 256
Joined: Tue Jun 19, 2012 2:14 pm

Re: ProFunds 2017 YTD returns...

Post by TSPBuilder »

Viper wrote:
sonofnthng wrote:So are there fees or not? Sounds like OP is trying to sell a product, because why work so hard to convince others to jump onto your ship? Who cares what anyone else is doing, if you are achieving results to your satisfaction.
So, out of sheer confusion and curiosity, are there fees or not? Please provide a source.


YES there are FEES. Sky high fees in fact. Don't fall for this bait and switch tactic. You can do far better on your own.


I don't think over ten years of continuously waiving fees qualifies as bait and switch. Does anybody do research anymore before lambasting someone?

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ReturnRate
Posts: 3
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Re: ProFunds 2017 YTD returns...

Post by ReturnRate »

skiehawk11 wrote:No. I wouldn't touch ProFunds with a ten-foot pole. The fees are outrageous and not worth the increased volatility experienced on a daily leveraged fund. It'd be cheaper (fee wise) to invest in deep-in-the-money option calls for an underlying ETF (more leverage too). A trick is to make sure the options delta is .60 or higher so you get a 60 cent movement or higher per dollar movement on the ETF.

On another note, the returns calculated for leveraged funds are misleading as the returns are calculated as log returns and adjusted daily. This results in contango or backwardation distorting the actual returns shown. I'm highly surprised TSPBuilder has the same return (in his account presumably) as what the account shows. Calculating the returns on a daily basis, his account should have experienced around 16.7% return which is around 2 percent less showing on the returns page (contango baby).


I will second that advice. Definitely not worth the crazy fees.

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evilanne
Posts: 1886
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Re: ProFunds 2017 YTD returns...

Post by evilanne »

Profunds are limited only to their funds which I find restrictive, so I wouldn't need to research any fees. But since this debate doesn't seems to end, this is what I found:
From TSPBuilders touted UltraLatin fund: posting.php?mode=reply&f=44&t=13380
The UltraLatin America ProFund seeks daily investment results, before fees and expenses, that are 2x the return of the Bank of New York Latin America 35 ADR Index for a single day.
<snip>
Average Annual One Year 66.81%
<snip>
Cumulative Since Inception -90.37% [10/16/2007]
<snip>
Net Expense Ratio * 1.78%
* Contractual waiver effective from December 1, 2016 through November 30, 2017. Without such a waiver of fees, the total returns would have been lower.
<snip>
All ProFunds are subject to active investor risk. There are no restrictions on the size and frequency of trades and no transaction fees. The frequent exchanges our policies permit can decrease performance, increase expenses and cause investors to incur tax consequences.


From Profund's Annual Report July 2016: http://www.profunds.com/media/pdf/repor ... report.pdf
Factors that Materially Affected the Performance of Each Fund during the Fiscal Year Ended July 31, 2016:
Primary factors affecting Fund performance, before fees and expenses, include the following: the total return of the securities and derivatives held by the Funds, including the performance of the reference assets to which any derivatives are linked, nancing rates paid or earned by the Fund (including those included in the total return of derivatives contracts); the types of derivative contracts used by the Funds and their correlation to the relevant benchmark or asset fees, expenses, and transaction costs; other miscellaneous factors; and in the case of the Geared Funds, the volatility of the Fund’s benchmark (and its impact on compounding).
<snip>

Fees, Expenses, and Transaction Costs: Fees and expenses are listed in the financial statements of each Fund and may generally be higher and thus have a more negative impact on performance than compared to many traditional index-based funds. For Geared Funds, daily repositioning of each Fund’s portfolio to maintain exposure consistent with its investment objective, high levels of shareholder purchase and redemption activity, and use of leverage may lead to commensurate increases in portfolio transactions and transaction costs which negatively impact the daily NAV of each Fund. Transaction costs are not reflected in the Funds’ expense ratio.Transaction costs are generally higher for Funds whose benchmarks are more volatile, have a larger daily multiple of its benchmark’s return, that seek to return an inverse or inverse multiple of its benchmark’s return, and for Funds that hold or have exposure to assets that are comparatively less liquid than other Funds.


There are different types of fees and expenses that may not be apparent even if they waive their fee, there may be fees imbedded in actual instruments and someone has to pay the expenses, which no-one is doing for free. More power to you if you are making money, but they seem too risky in my book.

TSPBuilder
Posts: 256
Joined: Tue Jun 19, 2012 2:14 pm

Re: ProFunds 2017 YTD returns...

Post by TSPBuilder »

evilanne wrote:Profunds are limited only to their funds which I find restrictive, so I wouldn't need to research any fees. But since this debate doesn't seems to end, this is what I found:
From TSPBuilders touted UltraLatin fund: posting.php?mode=reply&f=44&t=13380
The UltraLatin America ProFund seeks daily investment results, before fees and expenses, that are 2x the return of the Bank of New York Latin America 35 ADR Index for a single day.
<snip>
Average Annual One Year 66.81%
<snip>
Cumulative Since Inception -90.37% [10/16/2007]
<snip>
Net Expense Ratio * 1.78%
* Contractual waiver effective from December 1, 2016 through November 30, 2017. Without such a waiver of fees, the total returns would have been lower.
<snip>
All ProFunds are subject to active investor risk. There are no restrictions on the size and frequency of trades and no transaction fees. The frequent exchanges our policies permit can decrease performance, increase expenses and cause investors to incur tax consequences.


From Profund's Annual Report July 2016: http://www.profunds.com/media/pdf/repor ... report.pdf
Factors that Materially Affected the Performance of Each Fund during the Fiscal Year Ended July 31, 2016:
Primary factors affecting Fund performance, before fees and expenses, include the following: the total return of the securities and derivatives held by the Funds, including the performance of the reference assets to which any derivatives are linked, nancing rates paid or earned by the Fund (including those included in the total return of derivatives contracts); the types of derivative contracts used by the Funds and their correlation to the relevant benchmark or asset fees, expenses, and transaction costs; other miscellaneous factors; and in the case of the Geared Funds, the volatility of the Fund’s benchmark (and its impact on compounding).
<snip>

Fees, Expenses, and Transaction Costs: Fees and expenses are listed in the financial statements of each Fund and may generally be higher and thus have a more negative impact on performance than compared to many traditional index-based funds. For Geared Funds, daily repositioning of each Fund’s portfolio to maintain exposure consistent with its investment objective, high levels of shareholder purchase and redemption activity, and use of leverage may lead to commensurate increases in portfolio transactions and transaction costs which negatively impact the daily NAV of each Fund. Transaction costs are not reflected in the Funds’ expense ratio.Transaction costs are generally higher for Funds whose benchmarks are more volatile, have a larger daily multiple of its benchmark’s return, that seek to return an inverse or inverse multiple of its benchmark’s return, and for Funds that hold or have exposure to assets that are comparatively less liquid than other Funds.


There are different types of fees and expenses that may not be apparent even if they waive their fee, there may be fees imbedded in actual instruments and someone has to pay the expenses, which no-one is doing for free. More power to you if you are making money, but they seem too risky in my book.


Thanks evilanne for doing the legwork :)

mindofmush
Posts: 353
Joined: Mon Jul 02, 2012 1:38 pm

Re: ProFunds 2017 YTD returns...

Post by mindofmush »

The argument about expense ratios really is moot:

Returns Net of Expenses (from Zacks.com)
The investment return reported by a mutual fund is always calculated net of expenses. If a fund reports an annual gain of 10 percent, investors receive 10 percent on their money. From a reported return point of view, it does not matter whether the fund had a 0.5 percent expense ratio or a 2.5 percent ratio. To earn that 10 percent for investors, the low-cost fund manager had to earn 10.5 percent on the portfolio. But the more expensive fund's portfolio generated a 12.5 percent gross return to pay investors 10 percent.


From shiehawk11:
1. The expense ratio with the contractual waiver is still 1.78 percent. That's insane. You can get the same performance or better long term (check 10-year returns or since inception) net of fees with Vanguard. For instance, the best performing ProFunds is Consumer Services with an expense ratio of 1.56% (contractual costs waived). Vanguard's consumer services ETF return from the same time period is 9.29 percent with an expense ratio of .10% You're essentially paying for them to risk your money and reap almost 2 percent returns on no risked capital on their part. No thanks. :) To further the point, see the calculator below.

http://www.telegraph.co.uk/investing/isas/investment-fees-calculator-how-much-will-charges-affect-your-ret/

I assumed 1,000 dollars/pounds start (currency is irrelevant for this example) with no contributions for 30 years.

Profunds - 9.86% return / 1.56% fee - 10,771 dollars/pounds (should be $16,795.51)
Vanguard - 9.29% return / .09% fee - 13,994 dollars/pounds (should be $14,368.49)

This comparison is incorrect because the 1.56% fee is already included in the reported 9.86% return and shouldn't be deducted a second time. Since both the Profunds and the Vanguard mutual funds are no load funds, which means no additional fees to calculate, the Profund account will always be greater than the Vanguard account as long as 9.86% is greater than 9.29%.

Yes, the Profund managers are pocketing 1.56% on the growth of that fund to provide you with a 9.86% return on your money (that's .57% more than Vanguard) but you do get what you pay for.
mo meng, mo ching (which loosely means: no money, no life)

OmegaΩ
Posts: 2
Joined: Sun Feb 26, 2017 7:42 pm

Re: ProFunds 2017 YTD returns...

Post by OmegaΩ »

Wow those ProFunds really have very high fees.

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Fund Prices2021-05-07

FundPriceDayYTD
G $16.58 0.00% 0.43%
F $20.72 0.00% -2.27%
C $63.32 0.75% 13.24%
S $82.16 1.32% 10.72%
I $38.76 1.29% 9.51%
L2065 $13.84 1.02% 11.49%
L2060 $13.84 1.02% 11.49%
L2055 $13.84 1.02% 11.49%
L2050 $28.21 0.84% 9.30%
L2045 $12.88 0.79% 8.73%
L2040 $47.05 0.73% 8.19%
L2035 $12.44 0.67% 7.54%
L2030 $41.46 0.61% 6.91%
L2025 $11.77 0.48% 5.47%
Linc $22.89 0.23% 2.76%

Pending Allocations

Under development. For now, you may view Pending Allocations by going to "fantasy TSP" and selecting "Leaderboard sort" of "Pending Allocations".

What else

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