3 Mistakes to Avoid With Your Investment Portfolio in 2024

And a “white whale” on our podcast this week. [Morningstar](?utm_source=eloqua&utm_medium=email&utm_campaign=newsletter_improvingfinances&utm_content=51474&elqTrackId=461b245480f64c3eace6a094caabc1b5&elq=9fbf9bab821848d98503adc91418c256&elqaid=51474&elqat=1&elqCampaignId=25848) [Improving Your Finances] Improving Your Finances with [Christine Benz]( [Christine Benz] These seem like halcyon days for investors, what with newly lush yields on cash and bonds and stocks scraping new highs almost daily. Yet complacency can also be a risk in strong markets: It might be tempting to let your winners ride, chase higher-yielding securities without due consideration of their risks, or ignore smaller-bore matters like tax-efficient asset placement. [Susan Dziubinski and I recently sat down to discuss some of the key portfolio mistakes that investors should be sure to avoid this year](. On the topic of yield-chasing, John Rekenthaler’s recent examination of covered-call stock funds—or “derivative income funds”—provides a worthwhile case study. Notwithstanding the gusher of fund flows into these offerings, [John determined that plain-vanilla equity-income funds outperformed covered-call equity funds]( on a total return basis in the five-year period ended December 2023. Of course, the point of these funds is to cede the upside, so one might not have expected them to thrive during a bull market. But in [a follow-up column]( John calls out the funds as unpleasantly unpredictable, in that it’s difficult to discern when they’ll thrive as well as which funds in the group will emerge victorious. Rather than chasing yield, one of the best ways to improve take-home returns in this era of higher yields is to watch [asset location]( like a hawk, starting with taking full advantage of tax-sheltered accounts. But [is there ever an occasion when a taxable account would be better than investing in a tax-sheltered company retirement plan like a 401(k)]( Perhaps, I discovered, if the 401(k) is especially bad and [the taxable account is invested with care](. Finally, Jeff Ptak and I had a few “white whales” in our sights—people we very much wanted to interview but who were long shots because they tend to grant very few interviews—when we launched our Long View podcast for Morningstar in 2019. On our short list was the team at Primecap Management, which has long been a favorite among Morningstar’s investment analysts. (Vanguard Primecap Core has had a spot in my husband’s and my portfolio since its launch 20 years ago.) I’m happy to report that we got our wish to speak to Joel Fried and Al Mordecai last week, and [the podcast launched on Tuesday](. I hope that you enjoy the conversation with these wonderful investors as much as Jeff and I did. With warm regards, Christine Benz [How to Build a Portfolio You Don’t Have to Babysit]( These four steps can help you craft a (mostly) hands-off portfolio. [Tell Me More]( Share: [facebook]( [twitter]( [linkedin]( ADVERTISEMENT [media]( [media] [Joel Fried and Al Mordecai: Upholding the Culture at Primecap Management]( Two veteran managers of the Vanguard Primecap Fund discuss the firm’s storied history, how they run money, and more. [Tune In Today]( [Covered-Call Stock Funds Like JEPI Are Popular]( High distributions from these funds don’t tell the whole story. [Should They Be?]( [Covered-Call Funds: A Mystery Wrapped in an Enigma]( These funds can perform well, but it’s hard to predict under what conditions. [Read More]( [3 Mistakes to Avoid With Your Investment Portfolio in 2024]( Don’t let these oversights thwart your portfolio’s performance this year. [Find Out More]( Listen Now Get the latest investing insights and market updates with [Morningstar’s podcasts]( available on your iPhone, iPad, Android, PC, or smart speaker. Stay connected: [twitter]( [facebook]( [linkedin]( [instagram]( [YouTube]( [Apple News]( [View online]( | [See all newsletters]( | [Share your feedback]( [Unsubscribe]( from this newsletter. Or update your [email preferences](. © 2024 Morningstar, Inc. All Rights Reserved. 22 W. Washington St. Chicago, IL 60602