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From: mazlack@ernie.berkeley.edu.BERKELEY.EDU (Lawrence J. &)
Newsgroups: net.invest
Subject: Re: GinnieMae funds
Message-ID: <11998@ucbvax.BERKELEY.EDU>
Date: Sun, 23-Feb-86 23:51:09 EST
Article-I.D.: ucbvax.11998
Posted: Sun Feb 23 23:51:09 1986
Date-Received: Wed, 26-Feb-86 06:24:39 EST
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Reply-To: mazlack@ernie.berkeley.edu.UUCP (Lawrence J. Mazlack)
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>Can anyone explain why different GinnieMae funds pay
>different rates.  Also, what are the risks of higher paying
>funds?  (They seem to range from 10% to almost 12%).  Is
>there any systematic way to determine which fund is
>currently paying the highest rate?

The easiest way to find out what their rates are to call their 800
number.  There aren't so many that this is a big chore.  Another way is
to look it up in Barron's.  For example, the last divident for Vanguards
GNMA fund was: .085.  The price of a share was: 10.07.  Thus the dividend
on an annualized basis is : 10.1%.  But, this isn't really such a good
number, if you call them, you usually can get: (a) current rate, annualized, 
(b) average rate over last week, (c) average rate over last month, and
(d) average rate over last year.

Make sure that you are comparing apples to apples when you compare rates
between competitors.

The rate will vary somewhat because some companies own paper with longer
maturities than others. But, comprable investments should have approximately
the same return.

The thing to look out for are charges.  (I manage several "pools" and
read these things pretty carefully.)  You should ONLY buy no-load GNMA
funds.  There is no need to pay either a front or back end load for this
type of fund.  If you do, you are throwing your money away.  The other
thing to look out for is management charges.  Some no-load funds charge
a hefty 1.5% annual management charge, while others charge 0.015.