http://www.latimes.com/business/la-fi-r ... 9088.storyWorries over 401(k) and IRA shortfalls spur day trading within the accounts....
Investors day trading within 401(k)s, IRAs.
Investors day trading within 401(k)s, IRAs.
Here's some scary news.
Gordon
Re: Investors day trading within 401(k)s, IRAs.
Not really. From the article:
Most Americans with IRA or 401(k) accounts embrace the "set it and forget it" philosophy. Only about 15% of investors made any change to their 401(k)s last year, according to benefits firm Aon Hewitt.
Re: Investors day trading within 401(k)s, IRAs.
I think he's found a better solution for his retirement, than day-trading his 401(k).The site, which charges a one-time fee of $199
Meet my pet, Peeve, who loves to convert non-acronyms into acronyms: FED, ROTH, CASH, IVY, ...
Re: Investors day trading within 401(k)s, IRAs.
You know what they say about a fool and his money. But the first example they give of the "biomedical software engineer" doesn't sound like day-trading. It's a bit of market timing. But I wouldn't consider that day-trading as it's commonly understood. As for the Wells Fargo employee, I don't expect someone in customer complaints to have access to inside information. But I'm sure the legal eagles at WF are probably calling that guy in for a meeting to explain how stupid he is to be talking about trading company stock that way.
Re: Investors day trading within 401(k)s, IRAs.
I really liked this quote in the article:
"When I told my wife about it [day trading the 401k] she was really nervous … until I educated her on what it all entails and how poorly [the 401(k)] was performing before that," Hansman said. "She's still not 100% behind it but she said, 'Just don't lose everything. If you do I'll divorce you".
So, loosing some of it is ok? You are living in a fantasy land if you think you can outsmart the market!
--Nate.
"When I told my wife about it [day trading the 401k] she was really nervous … until I educated her on what it all entails and how poorly [the 401(k)] was performing before that," Hansman said. "She's still not 100% behind it but she said, 'Just don't lose everything. If you do I'll divorce you".
So, loosing some of it is ok? You are living in a fantasy land if you think you can outsmart the market!
--Nate.
Re: Investors day trading within 401(k)s, IRAs.
You can market-time with mutual funds, but you can't really day trade, now can you? Maybe "week trade". Let's see what the article says:
People with self-directed brokerage access in their 401ks could day-trade ETFs or stocks, but at (typically) $8/trade or more they'd probably go broke even faster than regular day traders.
So maybe "month trade"?Todd Larsen, a mechanical engineer from Willow Park, Texas, runs http://www.401ktradingsystem.com, a website that advises followers to shift their money once a month.
People with self-directed brokerage access in their 401ks could day-trade ETFs or stocks, but at (typically) $8/trade or more they'd probably go broke even faster than regular day traders.
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Re: Investors day trading within 401(k)s, IRAs.
I thought that "day trading" specifically meant completing the trade, buy and sell, within a single market business day... because you're using a special brokerage arrangement that gives you huge leverage... and a rule that you are not allowed to hold overnight because the brokerage fear prices would drop too much overnight and they wouldn't be able to sell you out in time.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
Re: Investors day trading within 401(k)s, IRAs.
22twain wrote:I think he's found a better solution for his retirement, than day-trading his 401(k).The site, which charges a one-time fee of $199
So has this guy:
It should be titled "The Art of Cashing in on the Shaky financial intelligence of desperate retirees".Richard Schmitt, an adjunct professor at Golden Gate University in San Francisco and a former retirement plan consultant, has come out with a book called "401(k) Day Trading: The Art of Cashing in on a Shaky Market in Minutes a Day." The book, published in October by Wiley Trading, has a list price of $49.95.
Andy
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Re: Investors day trading within 401(k)s, IRAs.
This isn't news, by my definition. There are no data in the story which indicate that this is actually a rising trend. The one piece of actual information that actually relates to account activity among 401k participants is this:gkaplan wrote:Here's some scary news.
http://www.latimes.com/business/la-fi-r ... 9088.storyWorries over 401(k) and IRA shortfalls spur day trading within the accounts....
20 trades per year does not a day-trader make. This looks to me like an example of a reporter trying to create a story where none exists.Brokerage windows typically are used by experienced investors with higher incomes and larger 401(k) balances. The average person with such an account trades more than 20 times a year, according to Charles Schwab Corp.
- DDB
"We have to encourage a return to traditional moral values. Most importantly, we have to promote general social concern, and less materialism in young people." - PB
Re: Investors day trading within 401(k)s, IRAs.
It is called 401k day trading as described in R. Schmitt's book. I tried to discuss his approach here on this forum about 5-6 months ago but was almost banned from this forum and the thread was angrily deleted by the moderators. You can call it market timing, however the trade occurs every day, or week, or month. You needto read the book and not just take it from an LA Times reporter.Novine wrote:You know what they say about a fool and his money. But the first example they give of the "biomedical software engineer" doesn't sound like day-trading. It's a bit of market timing.
Moderators encourage different points of view expressed in a civil manner. Put "day trading" Bogleheads into Google and you will receive 31,300 hits. -- Taylor
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
I think the article should have been titled "Americans NOT Day Trading in their 401k"
Most Americans with IRA or 401(k) accounts embrace the "set it and forget it" philosophy. Only about 15% of investors made any change to their 401(k)s last year, according to benefits firm Aon Hewitt.
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Re: Investors day trading within 401(k)s, IRAs.
Welcome to Fant-a-see Eye-land!NateW wrote:I really liked this quote in the article:
"When I told my wife about it [day trading the 401k] she was really nervous … until I educated her on what it all entails and how poorly [the 401(k)] was performing before that," Hansman said. "She's still not 100% behind it but she said, 'Just don't lose everything. If you do I'll divorce you".
So, loosing some of it is ok? You are living in a fantasy land if you think you can outsmart the market!
--Nate.
Now you see it, now you don't!
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
Re: Investors day trading within 401(k)s, IRAs.
Why do you think it is scary?gkaplan wrote:Here's some scary news.
http://www.latimes.com/business/la-fi-r ... 9088.storyWorries over 401(k) and IRA shortfalls spur day trading within the accounts....
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
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Re: Investors day trading within 401(k)s, IRAs.
Yeah, idiots will always find ways to blow their money. This doesn't have much effect on people who don't do it.verakot wrote:Why do you think it is scary?
Brian
Re: Investors day trading within 401(k)s, IRAs.
Why do you think they are idiots? Just because they do not follow the "buy-and-hold" principle?Default User BR wrote:Yeah, idiots will always find ways to blow their money. This doesn't have much effect on people who don't do it.verakot wrote:Why do you think it is scary?
Brian
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
I do not see what is unique or interesting about this at all. You can do this with any mutual fund in any account, not just a 401k (although taxes become a factor). In fact is arguably harder to do this in a Vanguard 401k since Vanguard funds restrict exchanges within a 60 day period. I think you could probably work around this by splitting your trading across more than one retirement account, but I haven't tried.verakot wrote:It is called 401k day trading as described in R. Schmitt's book. I tried to discuss his approach here on this forum about 5-6 months ago but was almost banned from this forum and the thread was angrily deleted by the moderators. You can call it market timing, however the trade occurs every day, or week, or month. You needto read the book and not just take it from an LA Times reporter.
Also it seems to be simply market timing, and very limited market timing at best. Yes, if you buy on a day where the market is going up, you will most likely get a lower price than the day before. But that says nothing about whether the fund will go up or down the next day.
Re: Investors day trading within 401(k)s, IRAs.
Chalk it up to a slow news day in LA. No helicopter chases on the ten. So they write about retirees.
We're slow-moving targets. And we read newspapers (the old-fashioned way, in print).
PS: Turn the page. You might find a piece about CD ladders. Or LTC insurance. Or (fill in the blank). With an ad for "early-bird" discounts at an eatery. My golly, did I just type "eatery"? My golly. Senior moment.
Okey dokey, off to check my trading account. Futures and Europe are up, but I promise I won't bet the walker.
We're slow-moving targets. And we read newspapers (the old-fashioned way, in print).
PS: Turn the page. You might find a piece about CD ladders. Or LTC insurance. Or (fill in the blank). With an ad for "early-bird" discounts at an eatery. My golly, did I just type "eatery"? My golly. Senior moment.
Okey dokey, off to check my trading account. Futures and Europe are up, but I promise I won't bet the walker.
Re: Investors day trading within 401(k)s, IRAs.
Actually, you SELL on a day when the market is going up. This is because you know you sell the funds high. You BUY on a day the market is going down - because you sell buy it low.claimui wrote: Yes, if you buy on a day where the market is going up, you will most likely get a lower price than the day before.
If does not matter that you do not know whether the fund will go up or down next day. All it matters that it goes up or down. If the market stays the same, there is no buy or sell transaction.claimui wrote: But that says nothing about whether the fund will go up or down the next day.
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
You're right, I made a typo. My point is that this is not really an advantage unless you have some way to predict the future. It is the same as waiting until 3 pm to buy or sell a stock and getting the current market price rather than yesterday's closing price -- except you have more risk because the price could still change during the last hour of trading.
Re: Investors day trading within 401(k)s, IRAs.
Well, what if I tell you that ANYONE can predict the future? [wait, read more] . There is a way to predict the future - at least when you buy or sell a fund within the last 2 minutes of trading - about 3:58PM EST (stock market closes at 4:00 EST). Anyone can predict with highest probability that the stock market will be up, down or quite unchanged for that day. If the market if unchanged, no fund trading is made. But if the market is up 1% in the last 2 minutes of trading, you know it will not significantly change during the last minute of trading when you do the transaction.claimui wrote: My point is that this is not really an advantage unless you have some way to predict the future. It is the same as waiting until 3 pm to buy or sell a stock and getting the current market price rather than yesterday's closing price -- except you have more risk because the price could still change during the last hour of trading.
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
Has anyone really been far even as decided to use even go want to do look more like?verakot wrote:There is a way to predict the future - at least when you buy or sell a fund within the last 2 minutes of trading - about 3:58PM EST (stock market closes at 4:00 EST). Anyone can predict with highest probability that the stock market will be up, down or quite unchanged for that day. If the market if unchanged, no fund trading is made. But if the market is up 1% in the last 2 minutes of trading, you know it will not significantly change during the last minute of trading when you do the transaction.
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Re: Investors day trading within 401(k)s, IRAs.
Day-trading is a form of gambling. Gambling, while it occasionally works out, has a pretty poor expected outcome.verakot wrote:Why do you think they are idiots? Just because they do not follow the "buy-and-hold" principle?Default User BR wrote:Yeah, idiots will always find ways to blow their money. This doesn't have much effect on people who don't do it.verakot wrote:Why do you think it is scary?
Brian
Re: Investors day trading within 401(k)s, IRAs.
Either your cat is walking on your keyboard and posting messages to this board, or you're having a stroke.SSSS wrote:Has anyone really been far even as decided to use even go want to do look more like?
Want to give it another shot and rephrase?
Re: Investors day trading within 401(k)s, IRAs.
Stock market as a whole is a form of gambling. So without any research you conclude that buy-and-hold works better than fund day trading?Default User BR wrote:Day-trading is a form of gambling. Gambling, while it occasionally works out, has a pretty poor expected outcome.
Brian
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
I disagree. IMO, gambling has a negative expected value while investing has a positive expected value.verakot wrote:Stock market as a whole is a form of gambling.
There is a MOUNTAIN of evidence which indicates that lower cost investments (and strategies) outperform higher cost investments. There is a MOUNTAIN of evidence which document the benefits of diversification. I don't know what kind of day trading you are talking about, but if it results in higher costs or inferior diversification you are putting the odds in favor of buy-and-hold outperforming your day trading.So without any research you conclude that buy-and-hold works better than fund day trading?
Best wishes.
Andy
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Re: Investors day trading within 401(k)s, IRAs.
You're free, of course, to believe whatever you wish.verakot wrote:Stock market as a whole is a form of gambling. So without any research you conclude that buy-and-hold works better than fund day trading?
Brian
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Re: Investors day trading within 401(k)s, IRAs.
Buy and hold is not what is recommended on this siteverakot wrote:Why do you think they are idiots? Just because they do not follow the "buy-and-hold" principle?Default User BR wrote:Yeah, idiots will always find ways to blow their money. This doesn't have much effect on people who don't do it.verakot wrote:Why do you think it is scary?
Brian
Pick low cost investments(mostly index funds,but not all)
have a plan
Save early and often
Pay attention to taxes
Stay the course
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Re: Investors day trading within 401(k)s, IRAs.
Why Is article is he comparing his return against the s&p 500 instead of a balanced portfolio of stocks (US,international, small,reit)and bonds.His return would probably been better if he used 3 fund portfolio. Does any one here use only s&p 500 as an investment?
Re: Investors day trading within 401(k)s, IRAs.
What a baffling thing to say...Johm221122 wrote: Buy and hold is not what is recommended on this site
"Know that buy-and-hold investing is not dead, but you have to put the asset allocation factor in there." - John Bogle
-- http://www.fool.com/investing/general/2 ... _xrt0hKhO0
"Of course buy and hold is the thing to do." - John Bogle
http://www.annuitydigest.com/news/john- ... -investing
"I would just say very simply, of all the stupid ideas, the idea that buy-and-hold investing is dead is [the most] ridiculous. ... I would say buy the bond market portfolio and the stock market portfolio and hold them both as long as you live" - John Bogle
http://www.indexuniverse.com/publicatio ... -dead.html
In that last one, he does touch on the nuances that I think you were alluding to, but the point is that they are nuances -- Bogleheads are buy-and-hold investors.
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Re: Investors day trading within 401(k)s, IRAs.
We buy,hold and rebalance or stay the course after having investment plan,buying low cost funds, being diversified, watching tax placement etc... but no I just don't buy and holdboglestan wrote:What a baffling thing to say...Johm221122 wrote: Buy and hold is not what is recommended on this site
"Know that buy-and-hold investing is not dead, but you have to put the asset allocation factor in there." - John Bogle
-- http://www.fool.com/investing/general/2 ... _xrt0hKhO0
"Of course buy and hold is the thing to do." - John Bogle
http://www.annuitydigest.com/news/john- ... -investing
"I would just say very simply, of all the stupid ideas, the idea that buy-and-hold investing is dead is [the most] ridiculous. ... I would say buy the bond market portfolio and the stock market portfolio and hold them both as long as you live" - John Bogle
http://www.indexuniverse.com/publicatio ... -dead.html
In that last one, he does touch on the nuances that I think you were alluding to, but the point is that they are nuances -- Bogleheads are buy-and-hold investors.
EDIT: market timing is just plane gambling
Re: Investors day trading within 401(k)s, IRAs.
Risk management with interdependent choice: http://oxrep.oxfordjournals.org/content/15/3/52Wagnerjb wrote:I disagree. IMO, gambling has a negative expected value while investing has a positive expected value.verakot wrote:Stock market as a whole is a form of gambling.
In this paper the authors draw an stock market analogy with gambling. In normal times the market behaves like a game of roulette; the probabilities are known and largely independent of the investment decisions of the different players. In times of market stress, however, the game becomes more like poker (herding behavior takes over). The players now must give heavy weight to the psychology of other investors and how they are likely to react psychologically.
Wait a minute, you've switched to a different topic. Also who is here arguing against diversification? How did you come up with the higher cost? I can actually prove that fund day trading has lower cost than buy-and-hold strategy - just give me details of your 401k buy-and-hold portfolio.Wagnerjb wrote:There is a MOUNTAIN of evidence which indicates that lower cost investments (and strategies) outperform higher cost investments. There is a MOUNTAIN of evidence which document the benefits of diversification. I don't know what kind of day trading you are talking about, but if it results in higher costs or inferior diversification you are putting the odds in favor of buy-and-hold outperforming your day trading.So without any research you conclude that buy-and-hold works better than fund day trading?
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
Fine, it's "buy-and-hold-and-periodically-rebalance". But can you prove that "401k day trading" is "just plane gambling", and "buy-and-hold-and-periodically-rebalance" is not?Johm221122 wrote: We buy,hold and rebalance or stay the course after having investment plan,buying low cost funds, being diversified, watching tax placement etc... but no I just don't buy and hold
EDIT: market timing is just plane gambling
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
Back in the late 90s and early 2000s I participated in a website-- FundVision.com -- (now defunct) that had a Discussion Board where members actively traded mutual funds using Rydex and ProFunds and other actively managed funds. They were also strong proponents of technical analysis and charts. As I recall at one time they had a contest between proponents of their style of momentum trading and a style similar to BHs. Below is a description of the contest. Dr. William Bernstein
participated in the forum.
http://customer.wcta.net/roberty/
Bob's page started as a contest between Bob(trader) and a Buy&Hold guy.
If you click on "pony express report" you can follow the trades he made
while the contest was going. Compare this to the time line and history
of the market. When the market was going thru the bear stage Bob took
his lumps and came back. Bob of course won the contest, indicating that
momentum trading can work.
participated in the forum.
http://customer.wcta.net/roberty/
Bob's page started as a contest between Bob(trader) and a Buy&Hold guy.
If you click on "pony express report" you can follow the trades he made
while the contest was going. Compare this to the time line and history
of the market. When the market was going thru the bear stage Bob took
his lumps and came back. Bob of course won the contest, indicating that
momentum trading can work.
Re: Investors day trading within 401(k)s, IRAs.
Nonnie, sorry, you completely missed it. 401k/IRA fund day trading is different from individual stock day trading. You need to compare apples with apples. Here is ReutersTV video that might help:
http://www.youtube.com/watch?v=1n75X06Eer0
"Day trading, when done properly, can net major gains for your IRA or 401(k). In this episode of Money Clip, Personal Finance Editor Lauren Young runs through the strategies for getting the safest and greatest long-term gains by making short-term moves."
http://www.youtube.com/watch?v=1n75X06Eer0
"Day trading, when done properly, can net major gains for your IRA or 401(k). In this episode of Money Clip, Personal Finance Editor Lauren Young runs through the strategies for getting the safest and greatest long-term gains by making short-term moves."
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
No I didn't. I addressed the exact issues that are critical to determining whether an active strategy - whatever it is - has the odds in its favor or not.verakot wrote:Wait a minute, you've switched to a different topic.
I hold Vanguard Small Cap Value Institutional shares (VSIIX), Vanguard Total International fund Institutional shares (VTSNX), Vanguard Inflation Protected bond fund Institutional shares (VIPIX) and a Stable Value fund. The rest of my portfolio (IRA, Taxable, etc) holds the other asset classes. Please proceed with your proof.I can actually prove that fund day trading has lower cost than buy-and-hold strategy - just give me details of your 401k buy-and-hold portfolio.
Andy
Re: Investors day trading within 401(k)s, IRAs.
Excuse me-- where did I say anything about stock trading? The example I gave was mutual fund trading. To quote from the article that started this thread, " Some people are trading the mutual funds in their 401(k) plans more frequently."verakot wrote:Nonnie, sorry, you completely missed it. 401k/IRA fund day trading is different from individual stock day trading. You need to compare apples with apples. Here is ReutersTV video that might help:
http://www.youtube.com/watch?v=1n75X06Eer0
"Day trading, when done properly, can net major gains for your IRA or 401(k). In this episode of Money Clip, Personal Finance Editor Lauren Young runs through the strategies for getting the safest and greatest long-term gains by making short-term moves."
Re: Investors day trading within 401(k)s, IRAs.
The 401k day trading portfolio assumes two funds only - one that mimics S&P500, and the other one is a money market fund. So portfolio for day trading could be Vanguard 500 Index Fund (VFINX) and Prime Money Market (VMMXX) for example. Would you agree that this portfolio has lower cost that yours?Wagnerjb wrote:I hold Vanguard Small Cap Value Institutional shares (VSIIX), Vanguard Total International fund Institutional shares (VTSNX), Vanguard Inflation Protected bond fund Institutional shares (VIPIX) and a Stable Value fund. The rest of my portfolio (IRA, Taxable, etc) holds the other asset classes. Please proceed with your proof.
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
The link to Pony Express Contest that you gave - http://customer.wcta.net/roberty/fr-set-pe.html has most references to stocks.nonnie wrote:verakot wrote: Excuse me-- where did I say anything about stock trading? The example I gave was mutual fund trading. To quote from the article that started this thread, " Some people are trading the mutual funds in their 401(k) plans more frequently."
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
Sorry-- every single listing on that page is a mutual fund. That was the premise of the website and the contest. In addition it was an anecdote not an advocacy pieceverakot wrote:The link to Pony Express Contest that you gave - http://customer.wcta.net/roberty/fr-set-pe.html has most references to stocks.nonnie wrote:verakot wrote: Excuse me-- where did I say anything about stock trading? The example I gave was mutual fund trading. To quote from the article that started this thread, " Some people are trading the mutual funds in their 401(k) plans more frequently."
Nonnie
Last edited by nonnie on Tue Jul 10, 2012 10:07 pm, edited 1 time in total.
Re: Investors day trading within 401(k)s, IRAs.
Didn't I also mention diversification? Putting $100 bills under your mattress is awful low cost too, but will leave you out of the market when it surges. Your day trading strategy may do that too. Good luck.verakot wrote:The 401k day trading portfolio assumes two funds only - one that mimics S&P500, and the other one is a money market fund. So portfolio for day trading could be Vanguard 500 Index Fund (VFINX) and Prime Money Market (VMMXX) for example. Would you agree that this portfolio has lower cost that yours?Wagnerjb wrote:I hold Vanguard Small Cap Value Institutional shares (VSIIX), Vanguard Total International fund Institutional shares (VTSNX), Vanguard Inflation Protected bond fund Institutional shares (VIPIX) and a Stable Value fund. The rest of my portfolio (IRA, Taxable, etc) holds the other asset classes. Please proceed with your proof.
Andy
Re: Investors day trading within 401(k)s, IRAs.
I liked the "cat on the keyboard" thing, by the way. Gonna write that down.
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Re: Investors day trading within 401(k)s, IRAs.
verakot wrote:Fine, it's "buy-and-hold-and-periodically-rebalance". But can you prove that "401k day trading" is "just plane gambling", and "buy-and-hold-and-periodically-rebalance" is not?Johm221122 wrote: We buy,hold and rebalance or stay the course after having investment plan,buying low cost funds, being diversified, watching tax placement etc... but no I just don't buy and hold
EDIT: market timing is just plane gambling
In article case,he compared his returns against s&p 500 ,on this site nobody recommends a portfolio of 100% s&p 500,a portfolio of basically of small cap,large cap,international and fixed income which we all know has beat s&p 500 in this last 10/15 yearsJohm221122 wrote:Why Is article is he comparing his return against the s&p 500 instead of a balanced portfolio of stocks (US,international, small,reit)and bonds.His return would probably been better if he used 3 fund portfolio. Does any one here use only s&p 500 as an investment?
There is no way to constantly jump in out of market and guarantee you are going to beat an appropriate benchmark index for your age.It is a gamble your hoping to get better returns than benchmark, with benchmark your guaranteed benchmark return
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Re: Investors day trading within 401(k)s, IRAs.
If low cost was only thing that was preached we would use bank account (no fee)it is a low cost, well diversified portfolio, that is tax efficient. We also suggest you invest early and often and you buy,hold, and rebalance (stay the course) this is your best shot of getting an appropriate benchmark return.If you jump in and out of a couple of funds there is no guarantee (hence gambling)verakot wrote:The 401k day trading portfolio assumes two funds only - one that mimics S&P500, and the other one is a money market fund. So portfolio for day trading could be Vanguard 500 Index Fund (VFINX) and Prime Money Market (VMMXX) for example. Would you agree that this portfolio has lower cost that yours?Wagnerjb wrote:I hold Vanguard Small Cap Value Institutional shares (VSIIX), Vanguard Total International fund Institutional shares (VTSNX), Vanguard Inflation Protected bond fund Institutional shares (VIPIX) and a Stable Value fund. The rest of my portfolio (IRA, Taxable, etc) holds the other asset classes. Please proceed with your proof.
Re: Investors day trading within 401(k)s, IRAs.
Now after you agreed that 401k day trading has lower cost than "buy-and-hold", about diversification: no one said you use 100% of your investments for day trading. So once you dedicated some percentage of your funds for day trading, you can use the rest for other strategies, including "buy-and-hold" and diversify anyway you want.Wagnerjb wrote: Didn't I also mention diversification? Putting $100 bills under your mattress is awful low cost too, but will leave you out of the market when it surges. Your day trading strategy may do that too. Good luck.
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
Re: Investors day trading within 401(k)s, IRAs.
The S&P 500 is used as an indicator for comparison. Does your portfolio beat S&P 500 over time? If it does, you are doing much better than Warren Buffet who can't beat S&P 500 for 3 years in a row: http://www.fa-mag.com/fa-news/10849-buf ... -year.htmlJohm221122 wrote:verakot wrote:Fine, it's "buy-and-hold-and-periodically-rebalance". But can you prove that "401k day trading" is "just plane gambling", and "buy-and-hold-and-periodically-rebalance" is not?Johm221122 wrote: We buy,hold and rebalance or stay the course after having investment plan,buying low cost funds, being diversified, watching tax placement etc... but no I just don't buy and hold
EDIT: market timing is just plane gamblingIn article case,he compared his returns against s&p 500 ,on this site nobody recommends a portfolio of 100% s&p 500,a portfolio of basically of small cap,large cap,international and fixed income which we all know has beat s&p 500 in this last 10/15 yearsJohm221122 wrote:Why Is article is he comparing his return against the s&p 500 instead of a balanced portfolio of stocks (US,international, small,reit)and bonds.His return would probably been better if he used 3 fund portfolio. Does any one here use only s&p 500 as an investment?
Can you show me the portfolio that you mention that beats S&P 500 consistently?
What does "constantly jump in out of market " mean?Johm221122 wrote:There is no way to constantly jump in out of market and guarantee you are going to beat an appropriate benchmark index for your age.It is a gamble your hoping to get better returns than benchmark, with benchmark your guaranteed benchmark return
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
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Re: Investors day trading within 401(k)s, IRAs.
Buy day trading, I assume(with mutual funds)all days with 1% moves
My 401 only let's me trade once every 90 days
S&p is not a good benchmark for individual investor, unless 100 % US stocks which is not recommended
Edit,if you were going to do it use ETF and Ira
My 401 only let's me trade once every 90 days
S&p is not a good benchmark for individual investor, unless 100 % US stocks which is not recommended
Edit,if you were going to do it use ETF and Ira
Re: Investors day trading within 401(k)s, IRAs.
Well, then it is definitely not for you.Johm221122 wrote:My 401 only let's me trade once every 90 days
S&P 500 is one of the major indicators. It is one of the most commonly followed equity indices and many consider it the best representation of the market and a bellwether for the U.S. economyJohm221122 wrote: S&p is not a good benchmark for individual investor, unless 100 % US stocks which is not recommended
http://www.investopedia.com/terms/s/sp5 ... z1xWXVkcE1
...But there are also unknown unknowns – there are things we do not know, we don't know. - Donald Rumsfeld |
401(k) Day Trading: https://sites.google.com/site/401kdaytrading/
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Re: Investors day trading within 401(k)s, IRAs.
S&p 500 is not a good benchmark mark for someone 50% in bonds or 50% of stocks in international. It is a main stream media number not appropriate for investorsverakot wrote:Well, then it is definitely not for you.Johm221122 wrote:My 401 only let's me trade once every 90 days
S&P 500 is one of the major indicators. It is one of the most commonly followed equity indices and many consider it the best representation of the market and a bellwether for the U.S. economyJohm221122 wrote: S&p is not a good benchmark for individual investor, unless 100 % US stocks which is not recommended
http://www.investopedia.com/terms/s/sp5 ... z1xWXVkcE1
Re: Investors day trading within 401(k)s, IRAs.
S&P 500 is large-cap only. Total US stock market indexes have existed for about 40 years, so I suspect you're already aware of that but are trying to be evasive.verakot wrote:S&P 500 is one of the major indicators. It is one of the most commonly followed equity indices and many consider it the best representation of the market and a bellwether for the U.S. economy
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Re: Investors day trading within 401(k)s, IRAs.
I compare my portfolio against fidelity retirement 2020 fund