Hi Paul. Thank you for your reply. I have been invested in VINIX 100% in my 457. It is the lowest cost option in my 457 plan. I have abour 262k in it now. Looking at the dividend numbers I think this gives me about 5k in dividend income per year. I am currently 37 years old, and I will be able to retire from my present job with a defined benefit plan which would pay me about 70k(todays dollars) in about 12 years. The county I work for has a AAA bond rating so I am hopeful that I will be able to collect this benefit. In that time I think the dividends from the VINIX fund could easily be 10k, but if I continue to max my contribution, I estimate that the total dividend of this portfolio could approach 20k. This focus on dividends rather than price allows me to become "greedy when other are fearful, and fearful when other are greedy". Outside of my 457, I hold individual long term investment grade municipal bonds(which I picked up just over 2 years ago at attractive prices after Merideth Whitney made her call) and my wife holds the total bond market in her 401k. I am reaching for an asset allocation of 50% domestic, 25% bonds, and 25% international, but my intl allocation is short of the mark, and my bond allocation is to high. In the international markets I am currently purchasing the total international stock market index in my wife's 401k plan, and the european index outside of the plan.
VGK(european index) looks particularly attractive to me because of the dividend yield, which is currently higher than other major asset classes. What do you think of the idea of adjusting purchases to favor higher yielding major asset classes? For example buying munis(in the fixed income portion of the portfolio) after Whitney's call caused them to sell off, or buying the European index now in the intl portion of the portfolio because it appears to be the highest yielding asset in the group?