WISEX vs AMIPX

📈 Investing & Markets
#1

I currently have more than $300K invested in WISEX, but I did not know about AMIPX. AMIPX has a higher yield and lower expense ratio (about 0.89% vs .58%). Is there any reason why I shouldn’t move from WISEX to AMIPX?

#2

Good question. That made me do the following compare (used MarketWatch):
AMIGX - Yield:0, Expense ratio:0.87, Return % 1 yr:-3.73, 3 yr: 6.98, 5 yr: 14.22
AMINX - Yield:1.09, Expense ratio:0.76, Return % 1 yr:2.48, 3 yr: 7.56, 5 yr: 12.38
AMIPX - Yield:3.41, Expense ratio:0.58, Return % 1 yr:5.9, 3 yr: 2.3, 5 yr: 2.48
WISEX - Yield:1.37, Expense ratio:0.89, Return % 1 yr:4.71, 3 yr: 3.18, 5 yr: 2.91
Any thoughts?

#3

You’ll need to take the total returns with yields included into account:

https://www.jhinvestments.com/fund-compare?compare=WISEX,AMIPX,AMAPX

AMIPX was beating WISEX over some times but since inception they’re pretty close now.

If you look at AMAPX that was there for a longer time since inception, it’s slightly underperforming:

https://www.jhinvestments.com/fund-compare?compare=WISEX,AMAPX

That maybe due to the extra .25% fee over AMIPX.

I would be inclined to sell half and split between the two since you have the option of AMIPX over $100k. That will add a little diversification.

If it was obviously all around better I would swap entirely to it, but it isn’t obvious. Wisex actually has 5 stars for Morningstar vs 4 for the lower fee AMIPX, I’m guessing because it has less volatility and similar returns so far.

#4

Usually total returns will show what $10k or $1k invested will give you over time, fees and yields accounted for. What it can’t account for is taxation since taxes differ per person.

The ETFs are much better to avoid taxes due to capital gains distribution when not selling. So although AMIGX is an excellent mutual fund, if someone is in a higher tax bracket they may lose quite a bit to taxes due to large capital gains distributions every year, vs savings in SPUS or HLAL. Thats not a factor for sukuk though.

#5

Thanks for pointing out. I was not aware of that aspect.

Here is some additional info I found from Fidelity.com:
ETFs can be more tax efficient compared to traditional mutual funds. Generally, holding an ETF in a taxable account will generate less tax liabilities than if you held a similarly structured mutual fund in the same account.
To be fair to mutual funds, managers take advantage of carrying capital losses from prior years, tax-loss harvesting, and other tax mitigation strategies to diminish the import of annual capital gains taxes.

I have another related question:
Investopedia.com says: “The taxes aren’t due for that tax year if the investor owns the fund as part of an IRA, 401(k), or other tax-deferred retirement plan. They’ll come due when the funds are withdrawn in retirement.”
If I have my 401K in AMIGX then I would have to think about taxes on capital gain distribution only when I withdraw from that account and not every year. Right?
Google AI says: "While ETFs are generally considered more tax-efficient than mutual funds, this benefit is less significant in tax-deferred accounts like 401ks. ".

#6

Taxation doesn’t have to do anything with the fund itself. So we can discount that in the comparison.

#7

There are no capital gains distribution taxes on retirement accounts so you don’t have to worry about that there. I just mentioned taxes since you had AMIG/NX in your list. It’s irrelevant to the sukuk comparison.

I have both amana funds and the newer ETFs in both taxable investment and retirement accounts. I used to only have the amana funds in both. If it wasn’t for the large capital gains tax hit I would have sold a large chunk to shift more to the ETFs for the taxable accounts. Instead I’m just buying ETFs for new savings, and keeping my old amana investments.

It would be nice if there’s an investment gain over time graph that accounts for taxes, but obviously it would be limited in accuracy. No one can predict future tax rates anyway.

There’s the saying “don’t let the tax tail wag the dog”, but given how our taxes are being used for genocide I am trying not to sell my gained stocks unnecessarily.