Search found 189 matches

by Malachi
Thu Jun 07, 2012 1:29 pm
Forum: Investing - Theory, News & General
Topic: Total Bond Fund SEC Yield below 2%
Replies: 73
Views: 9389

Re: Total Bond Fund SEC Yield below 2%

FinanceFun wrote:It's not demand raising the value of cash that causes the deflationary issues. Its the slow-down in the velocity of money. Common misconception.
Thank you for that clarification.
by Malachi
Thu Jun 07, 2012 1:15 pm
Forum: Investing - Theory, News & General
Topic: Total Bond Fund SEC Yield below 2%
Replies: 73
Views: 9389

Re: Total Bond Fund SEC Yield below 2%

I would respectively disagree that we are in a deflationary environment. The general price level of goods and services is not dropping at all. In addition to that the calculation of CPI is incredibly flawed as it leaves out energy and food prices. Last I checked everyone had to keep the lights and eat a few times per day. The Bureau of Labor Statistics does many different calculations of inflation, not just one. If you want food and energy included in the calculation then use CPI-U. The Fed is "printing money" like mad because people want to hold on to cash (and cash equivalents). That demand raises the value of cash. If the Fed didn't meet that demand (through QE), then the rising value of cash would push prices down and we'd ha...
by Malachi
Thu Jun 07, 2012 12:54 pm
Forum: Investing - Theory, News & General
Topic: Total Bond Fund SEC Yield below 2%
Replies: 73
Views: 9389

Re: Total Bond Fund SEC Yield below 2%

NYBoglehead wrote:While that may be true, I cannot imagine deflationary pressure materializing in this environment. Politics aside, we've had 4 consecutive years of trillion dollar deficits and the Fed continues to debase the dollar by printing more money.
There may very well be consequences to the policies you list, but the very reason we have had two episodes of "quantitative easing" with more being contemplated is precisely because we ARE in a deflationary environment.
by Malachi
Thu Jun 07, 2012 11:58 am
Forum: Investing - Theory, News & General
Topic: Guru's still underperforming 2 to 1
Replies: 15
Views: 2976

Re: Guru's still underperforming 2 to 1

We should write a coin flipping simulator that simulates the entire market of gurus. It would simply run a couple of hundred separate but simultaneous coin flipping simulations. Each individual simulation would represent a "market guru". Then, we could see what the distribution of the simulated "gurus" turns out to be and how it compares to the real market of gurus.
by Malachi
Mon Jun 04, 2012 3:25 pm
Forum: Forum Issues and Administration
Topic: [Problem with] forum format, or bugs?
Replies: 49
Views: 4416

Re: [Problem with] forum format, or bugs?

thomasbayarea wrote:Did you push out a new CSS file? Best to degrade gracefully as Chrome will often error on CSS caching.
If there is a new CSS file, is there a way to tell Chrome to start using it? Because, right now, it's not.
by Malachi
Sat Jun 02, 2012 3:05 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing theory
Replies: 82
Views: 6379

Re: Rebalancing theory

rr2 wrote:Assuming that the investor is interested only in investing in the US,

US Bond market capitalization ~ 30 Trillion
US Stock market capitalization ~ 15 Trillion
Where did you get those numbers?

So, should the market cap weighted AA be 33/67 Stocks to Bonds?
Should any further rebalancing should aim to maintain whatever the current values are?
That's kind of what the discussion has been about. Do you have any thoughts on the subject?
by Malachi
Sat Jun 02, 2012 2:26 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing theory
Replies: 82
Views: 6379

Re: Rebalancing theory

JoeMatye wrote:Is there a difference between rebalancing within a fixed portfolio versus rebalancing with new money?
In a taxable account there is. Other than that, not that I'm aware of.

Edit: I guess too, in tax advantaged accounts like a 401k, there may be limits on transaction frequency but not usually contributions.
by Malachi
Sat Jun 02, 2012 8:47 am
Forum: Investing - Theory, News & General
Topic: Rebalancing theory
Replies: 82
Views: 6379

Re: Rebalancing theory

MCE Texan wrote:However since the rate of issuance is also related to fund turnover, I wonder if (in the absence of direct measurement from an index provider) the turnovers from a fairly comprehensive set of index funds (such as Vanguard Total World Stock Fund + Vanguard Total Bond Market) could be used to estimate changes in market proportions or even (assuming the issuance differential is fairly constant) just a constant transfer factor (like automatically transferring X% per month from stocks to bonds to finance the excess of new issuances on the bond side).
I don't think you could use individual funds. But, I wonder if you can use the total market caps of a couple of indexes as proxies?
by Malachi
Sat Jun 02, 2012 8:43 am
Forum: Investing - Theory, News & General
Topic: Rebalancing theory
Replies: 82
Views: 6379

Re: Rebalancing theory

deci02 wrote:Yes issuance of different asset classes of securities varies over time so in the paper cited by Bertilak Sharpe recommends periodic reference to total market stock/bond proportions to check markets capitalization as a risk marker but bemoans the lack of readily available data.
Are there any reasonable proxies? Such as the total market caps of total stocks and total bonds indexes?
by Malachi
Fri Jun 01, 2012 3:20 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing theory
Replies: 82
Views: 6379

Re: Rebalancing theory

To put it another way. Right now we have the following prices: VTSMX - $32.78 VBMFX - $11.12 Let's assume the current market weight is 50/50 for simplicity sake and ignore distributions. So, you buy $5000 of VTSMX and $5000 of VBMFX. Over time, let's say 10-years, both markets double in size. At that time, the share price of VTSMX will, presumably, be worth about $65 and your VTSMX holdings will be worth about $10,000. This is because of the way stocks work. Investors bid up the prices of the underlying stocks. You didn't have to do anything for your holding of VTSMX to grow with the market. But, that's not what will happen with VBMFX. 10 years from now, its share price will still be around $10. If you did nothing then at this point you hav...
by Malachi
Fri Jun 01, 2012 3:04 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing theory
Replies: 82
Views: 6379

Re: Rebalancing theory

But rebalancing isn't what accounts for newly issued securities...indexing does which is why index fund managers don't rebalance but simply: 1. Buy all newly issued securities. 2. Reinvest all dividends in proportion to the market value of each security in the portfolio. So if your portfolio consists of index funds and you spend the dividend checks then you actually don't need to do anything to maintain market weight because the managers of the index funds are already doing everything that needs to be done by buying the newly issued bonds (and also stocks). It's just if/when you reinvest the dividends you have to reinvest them at market weight...but that doesn't really mean you have to do anything either, it just means that if you do somet...
by Malachi
Fri Jun 01, 2012 12:39 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing theory
Replies: 82
Views: 6379

Re: Rebalancing theory

I can certainly accept that the relative risks between stocks and bonds changes over time. I can also accept holding a market weight of stocks and bonds. What I can't accept is that by doing nothing, your portfolio will maintain a market weight. That just isn't true. Stocks and bonds are different kinds of instruments and the stocks and bonds markets grow through different processes. With stocks, you can simply hold an index fund and do nothing because as companies grow, investors bid up the price of their stocks. Thus, your stock holdings grow right along with the market. But, that's not what happens with bonds. The bond market grows by new bonds being issued. As companies grow, they take on more debt, they do that by selling new bonds. Yo...
by Malachi
Thu May 31, 2012 8:28 am
Forum: Investing - Theory, News & General
Topic: Consumer Reports puts spotlight on 401(k) fees
Replies: 40
Views: 3279

Re: Consumer Reports puts spotlight on 401(k) fees

wjwhitney wrote:The poster called it a "contribution fee" which I assume means 0.25% taken from the contribution, which would be a one-time fee for each contribution. If it means 0.25% per year taken from the entire balance then of course the loss to the participant would be much greater.
You're right, he did call it that. My apologies.
by Malachi
Thu May 31, 2012 7:58 am
Forum: Investing - Theory, News & General
Topic: Consumer Reports puts spotlight on 401(k) fees
Replies: 40
Views: 3279

Re: Consumer Reports puts spotlight on 401(k) fees

OK, that's what I would call a "401k fee".... but taking a one-time 0.25% contribution fee off the top would take $2,500 off a $1,000,000 401k.... It's hard to figure how "401k fees" cost on average $155,000. You're not considering the lost return of that 0.25% over the lifetime of the investment. Yes I am... a one time 0.25% fee off the top when deposited results in a 0.25% difference in final account value at the end... you can do the math. 0.25% repeated every year would be a different story but that's not what was referred to in this particular post. The poster you were replying to didn't say it was a one time fee. Also, you wrote, "It's hard to figure how "401k fees" cost on average $155,000." I...
by Malachi
Wed May 30, 2012 11:20 pm
Forum: Investing - Theory, News & General
Topic: Consumer Reports puts spotlight on 401(k) fees
Replies: 40
Views: 3279

Re: Consumer Reports puts spotlight on 401(k) fees

wjwhitney wrote: OK, that's what I would call a "401k fee".... but taking a one-time 0.25% contribution fee off the top would take $2,500 off a $1,000,000 401k.... It's hard to figure how "401k fees" cost on average $155,000.
You're not considering the lost return of that 0.25% over the lifetime of the investment.
by Malachi
Wed May 30, 2012 9:44 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing theory
Replies: 82
Views: 6379

Re: Rebalancing theory

When people say "hold the market portfolio", presumably that means stocks and bonds relative to each other.

How does one maintain that balance? Presumably, given enough time, stocks will outgrow bonds in your portfolio but that does not mean that, during the same period of time, the stock market outgrew the bond market in their relative sizes to each other. As companies grow, they correspondingly take on more debt.

So, the need for periodic rebalancing still exists. The difference, as I see it, is that the ratio is determined by the market.

How do we determine that ratio?
by Malachi
Mon May 28, 2012 10:00 am
Forum: Investing - Theory, News & General
Topic: Canadian article: Why isn’t everyone beating the market?
Replies: 45
Views: 3504

Re: Canadian article: Why isn’t everyone beating the market?

GregLee wrote:I thought it was a good article up to where the author concludes that active investors cannot succeed because they chase performance. But the problem with being an active investor who chases performance is the chasing performance part, not the active investing part.
I'm not getting the distinction you're trying to make. By my reading, your second sentence precisely restates your first sentence.
by Malachi
Mon May 28, 2012 8:51 am
Forum: Investing - Theory, News & General
Topic: Canadian article: Why isn’t everyone beating the market?
Replies: 45
Views: 3504

Re: Canadian article: Why isn’t everyone beating the market?

That was a good and thought provoking article.
by Malachi
Fri May 25, 2012 8:37 am
Forum: Personal Investments
Topic: Investing Options for a Newbie
Replies: 15
Views: 1316

Re: Investing Options for a Newbie

TIAA Direct savings accounts are paying 1.25%, which is probably better than any short term alternative. And, it's FDIC insured.

As already noted, I-bonds cannot be cashed out for one year after they've been purchased, and there is a penalty of 3-months of interest for cashing them out within 5-years of purchase. They're better for medium term savings and emergency funds.
by Malachi
Thu May 24, 2012 11:00 am
Forum: Personal Investments
Topic: Bond Funds: Why are these Safe or are they?
Replies: 31
Views: 3659

Re: Bond Funds: Why are these Safe or are they?

To put it another way, what if you have to sell your laddered bonds before they mature? You're going to get market price for them. True, but the difference is that with a ladder you're in control of whether that occurs or not. Don't get me wrong, for most purposes a fund is better, but there are advantages to a ladder for known short-medium term liability matching. I think that it doesn't matter whether you hold on to it or not. Using some very rough math, let's say you paid a $100 for a bond that pays back $105 in a year. The very next day interest rates double and now you can buy $100 bond that pays back $110. The market value of the bond you bought the previous day drops to $95, but as you say, you can continue to hold the original bond...
by Malachi
Thu May 24, 2012 8:10 am
Forum: Personal Investments
Topic: Bond Funds: Why are these Safe or are they?
Replies: 31
Views: 3659

Re: Bond Funds: Why are these Safe or are they?

I'm confused about Bond Funds and why these are considered "safe." If you buy an individual bond you're guaranteed a small rate of return plus you get the principal back. If you invest in a Bond Fund (TBM) while the mixture of bonds in the funds continue to pay interest; isn't it likely at some point the per share price will go down, when the interest rates start going up, resulting in a loss of principal. Correct or Not?? Would a ladder of short term bonds (considering today's environment) be safer in protecting principal and possibly earn a small return? For example: $50K invested ladder: $10K...1 yr bond. $10K...2yr bond $10K...3yr bond. $10K...4yr bond. $10K...5 yr bond. Each year you have the option to move to better bond re...
by Malachi
Wed May 23, 2012 9:49 pm
Forum: Personal Finance (Not Investing)
Topic: House is paid off!!!
Replies: 48
Views: 5798

Re: House is paid off!!!

Awesome.

:thumbsup :thumbsup
by Malachi
Sun May 20, 2012 5:26 pm
Forum: Investing - Theory, News & General
Topic: Investment News Arcticle: Cost stance at Vanguard lures cash
Replies: 15
Views: 1998

Re: Investment News Arcticle: Cost stance at Vanguard lures

Personally, I doubt this trend is permanent.

People largely believe that they cannot make money in the market right now. So, they're cutting costs and who are you going to turn to when it comes to cutting costs? Vanguard, of course.

But, as soon as they start thinking they can make money in they market again, they'll head back to their active funds.

I guess we'll know we're in a bull market when the money starts flowing the other direction.
by Malachi
Sat May 19, 2012 9:14 pm
Forum: Personal Investments
Topic: Survey, Mutual fund versus ETF usage
Replies: 26
Views: 2293

Re: Survey, Mutual fund versus ETF usage

Personally, I prefer mutual funds to ETFs and at Vanguard I buy mutual funds. But, if my 401(k) had a brokerage window, I'd happily buy ETFs to get beyond the fund selection I have available to me in that account. On the other hand, if my 401(k) had the mutual funds I wanted, I wouldn't bother with ETFs whether there was a brokerage window or not.
by Malachi
Sat May 19, 2012 9:08 pm
Forum: Personal Investments
Topic: Survey, Mutual fund versus ETF usage
Replies: 26
Views: 2293

Re: Survey, Mutual fund versus ETF usage

The 8th option from the bottom is, I believe, misworded.
by Malachi
Sat May 19, 2012 4:55 pm
Forum: Personal Investments
Topic: ETFs or Mutual Funds: A Review and Analysis
Replies: 35
Views: 4304

Re: ETFs or Mutual Funds: A Review and Analysis

nisiprius wrote:Second, read Vanguard's nice and short piece, The basics of ETFs: A primer for the perplexed.
You accidentally used the same URL in this link as the previous one. Here's the page I think you meant:

The basics of ETFs: A primer for the perplexed
by Malachi
Sat May 19, 2012 11:33 am
Forum: Personal Investments
Topic: My Rebalance needs a Rebalance
Replies: 15
Views: 1176

Re: My Rebalance needs a Rebalance

Keep in mind, just because it's a 401(k) doesn't mean that there are no frequent trader restrictions. You should make sure you know what those restrictions are.
by Malachi
Sat May 19, 2012 11:27 am
Forum: Personal Investments
Topic: My Rebalance needs a Rebalance
Replies: 15
Views: 1176

Re: My Rebalance needs a Rebalance

I'm not sure how your question hasn't been answered.

If you have chosen to rebalance periodically, then rebalance when the period is up.

If you have chosen to rebalance when your AA is a certain percentage out of balance, then rebalance when it reaches that percentage.

Yes, you can also direct your contributions toward where they need to go to help keep your AA balanced. But, for large portfolios, this probably won't work by itself and you'll still need to do one of the two options above.

Or, of course, you could not rebalance at all, but that's not recommended.
by Malachi
Sat May 19, 2012 9:42 am
Forum: Personal Investments
Topic: ETFs or Mutual Funds: A Review and Analysis
Replies: 35
Views: 4304

Re: ETFs or Mutual Funds: A Review and Analysis

hazlitt777 wrote:1) How is it possible for anybody to provide such a product for a lower expense ratio than a mutual fund? ...after all they may get traded a lot generating more cost.
Because, with ETF's you pay the transaction costs when you make the trade through your broker. With no-load mutual funds, the transaction costs are part of the ER.

I believe that Vanguard's ETF ER's are equal to their mutual funds' Admiral Class shares.
by Malachi
Sat May 19, 2012 9:29 am
Forum: Personal Investments
Topic: My Rebalance needs a Rebalance
Replies: 15
Views: 1176

Re: My Rebalance needs a Rebalance

There are two main approaches to determining when to rebalance: a) at periodic intervals, ie. quarterly, yearly, or b) when your account becomes out of balance by a certain percentage.

Supposedly, on paper over the long run 'b' gives a minuscule better return. I use 'a' because I use the approach of set it and forget it.

One caution, make sure you don't get hit with frequent trader fees if your funds have limits to how often they can be traded.
by Malachi
Fri May 18, 2012 12:31 pm
Forum: Personal Finance (Not Investing)
Topic: Treasury Direct's website interface
Replies: 10
Views: 1922

Re: Treasury Direct's website interface

tetractys wrote:Another alternative would be to auto deposit to the 0 of C (or is that C of 0?), and then auto purchase in larger periods. But keep in mind the "0" stands for 0 interest. And I don't think it's any more convenient than using a personal bank account. -- Tet
That's not an unreasonable idea.

I opened a TIAA-Direct account a month or so ago and still haven't put it to use. Maybe I'll use it for this. If I'm going to accumulate cash, I suppose I might as well earn some interest on it. :wink:
by Malachi
Fri May 18, 2012 11:35 am
Forum: Personal Finance (Not Investing)
Topic: Treasury Direct's website interface
Replies: 10
Views: 1922

Re: Treasury Direct's website interface

Sure it does. I get paid by the week and it makes it simple. Simple is good. I'm not going to waste my time optimizing for a few pennies.

But, I will optimize for my time. Since it appears that dealing with lots of little bonds is going to be a hassle, I think I'm going to start accumulating cash and buying larger denominations.
by Malachi
Fri May 18, 2012 9:01 am
Forum: Personal Finance (Not Investing)
Topic: Treasury Direct's website interface
Replies: 10
Views: 1922

Re: Treasury Direct's website interface

Not sure about the interface, but weekly purchases does seem a bit extreme since I'm not sure what benefit it provides you. Quarterly sure sounds more appealing. I'm not sure what's "extreme" about squirreling away money every week. I'd be doing it whether it goes straight into TD or makes a pit-stop into a savings account first. The issue here isn't the purchasing of the bonds, which is about as hassle free as it could possibly be. Pull the trigger and forget about it. It takes care of itself. If these were mutual fund shares and I was dealing with a cost basis, then weekly purchases could be undesirable. The issue in this case is on the other end when it comes time to sell or rollover some bonds. Their interface appears to be r...
by Malachi
Fri May 18, 2012 7:55 am
Forum: Personal Finance (Not Investing)
Topic: Treasury Direct's website interface
Replies: 10
Views: 1922

Treasury Direct's website interface

I have started to accumulate I-bonds on Treasury Direct at the rate of $100 per week. Treasury Direct automatically withdraws the money directly from my checking account. The purpose of the account is to supplement my emergency funds. I have no specific use planned for the bonds at this time. As I look at their interface, I notice that there does not appear to be an ability to do multiple selections of the bonds that have been purchased. I'm thinking down the road, when they day comes that I might want to sell some bonds or roll them over to a higher interest rate, do I have to do it one bond at a time? With a lot of small bonds, that could become a bit unwieldy. Not to mention, determining which bonds I might want to rollover could be a re...
by Malachi
Sat Apr 28, 2012 12:55 pm
Forum: Personal Investments
Topic: Company changing Vanguard Funds
Replies: 3
Views: 573

Re: Company changing Vanguard Funds

As hoppy stated, they appear to be essentially different share classes to the same fund:

Vanguard Target Retirement 2045 Trust I
Vanguard Target Retirement 2045 Trust II

The only difference I see is the expense ratio and the resulting better returns in Trust I.
by Malachi
Wed Apr 25, 2012 5:59 pm
Forum: Personal Investments
Topic: JP Morgan (Chase) vs Vanguard
Replies: 18
Views: 25531

Re: JP Morgan (Chase) vs Vanguard

Since I wouldn't even consider investing through a bank, especially when we have Vanguard, I guess I'd have to turn the question around. What is it that you think the bank has to offer over Vanguard?
by Malachi
Wed Apr 25, 2012 5:15 pm
Forum: Personal Investments
Topic: 60/40 mix isn't that much more balanced than 100% equities
Replies: 12
Views: 1764

Re: 60/40 mix isn't that much more balanced than 100% equiti

You seem to be confusing issues. Most of the volatility of a 60/40 mix comes from the equities, so it makes sense that most of volatility of a 60/40 mix is correlated with equities. It is not the case that the equity portion drives the "entire portfolio's returns". That would be impossible unless bonds had no return. They don't. To demonstrate the above point, I generated the chart below in Excel. I got the data from the spreadsheet on the Wiki. The blue represents a $10,000 investment invested in a 60/40 fund in the beginning of 1985. The red represents the return from bonds and the green represents the return from stocks. As you can see, most of the volatility came from stocks. Since most of the volatility came from stocks it s...
by Malachi
Wed Apr 25, 2012 3:11 pm
Forum: Personal Investments
Topic: 60/40 mix isn't that much more balanced than 100% equities
Replies: 12
Views: 1764

Re: 60/40 mix isn't that much more balanced than 100% equiti

The correlation between 60/40 and 100% in equities is 98%.1 These two portfolios, go up and down in near-perfect tandem. Equities are so much more volatile than bonds that they drive the entire portfolio’s returns. Consequently, 60/40 is not environmentally balanced, because it does well only in economic environments where equities generally outperform! I'll stick with my indexing market timing combo per Ben Graham. You seem to be confusing issues. Most of the volatility of a 60/40 mix comes from the equities, so it makes sense that most of volatility of a 60/40 mix is correlated with equities. It is not the case that the equity portion drives the "entire portfolio's returns". That would be impossible unless bonds had no return. ...
by Malachi
Wed Apr 25, 2012 10:04 am
Forum: Personal Investments
Topic: Boring Investor Needs Guidance
Replies: 5
Views: 645

Re: Boring Investor Needs Guidance

Or, maybe:

40% - C Fund
30% - I Fund
20% - F Fund
10% - S Fund

If you like pretty, round, and descending numbers. :-)
by Malachi
Wed Apr 25, 2012 10:02 am
Forum: Personal Investments
Topic: Boring Investor Needs Guidance
Replies: 5
Views: 645

Re: Boring Investor Needs Guidance

Presumably, the S-Fund should be held in a ratio of 1:4 with the C-Fund to match the market. Also, I think you're a little light on the I-Fund.

I might suggest something more along this:

20% - F Fund
45% - C Fund
10% - S Fund
25% - I Fund

Just something to consider.
by Malachi
Wed Apr 25, 2012 7:44 am
Forum: Personal Investments
Topic: Beginner long-term portfolio
Replies: 36
Views: 2377

Re: Beginner long-term portfolio

I'm hesitant to max out my 401(k) because of the fear of locking down funds that could be needed prior to 65, I assume you all consider not maxing it out a bad idea? Personally, I don't pretend to know what my future tax rate will be or when I might need access to my investments. As such, I spread out my tax risk and access risk by funding a taxable account, a Roth, and my 401(k) all above and beyond my emergency savings account. Incidentally, concerning "access risk". Having all of your taxable investments in stocks could backfire for you. You may find yourself out of a job at precisely the same time the market tanks by 50%. In fact, there's a very high correlation between severe market drops and unemployment. As such, in your t...
by Malachi
Wed Apr 25, 2012 7:10 am
Forum: Personal Investments
Topic: Beginner long-term portfolio
Replies: 36
Views: 2377

Re: Beginner long-term portfolio

When using VEXMX in my Roth IRA, I know Duckie mentioned that the percentages of it in my portfolio is too high but necessary to meet fund minimums. What percentage should I aim for? Do I want roughly 1:4 with the SP Index Fund I have in my 401(K) (as a rough measure)? Yep, when your S&P 500 fund reaches $12,000, then you'll be at the right ratio for $3,000 of VEXMX. That ratio of S&P 500 and VEXMX gives you basically the same thing as the Total Stock Market index fund (VTSMX). It's not that big of a deal if the ratios aren't exactly right, right now. It may be that you don't need all your contributions in your Roth to go to VEXMX. In that case, consider the LifeStrategy Growth fund. It has the same ratios as what you're shooting f...
by Malachi
Tue Apr 24, 2012 11:25 pm
Forum: Personal Investments
Topic: My retirement portfolio
Replies: 21
Views: 2164

Re: My retirement portfolio

twojedimama wrote:fundamental investors RFNX 1.31
Is that, perhaps, suppose to be: American Funds Fundamental Investors R4 RFNEX?
by Malachi
Tue Apr 24, 2012 11:16 pm
Forum: Personal Investments
Topic: My retirement portfolio
Replies: 21
Views: 2164

Re: My retirement portfolio

letsgobobby wrote:Because you have Roth IRAs and taxable accounts, you can pick the least bad funds in your 401k and supplement. Let' see...
And there's the crux. Which one? JAFOX appears to me to be the least bad considering what information I've been able to find. That's not a glowing recommendation. Maybe you'll fair better.
by Malachi
Tue Apr 24, 2012 10:45 pm
Forum: Personal Investments
Topic: My retirement portfolio
Replies: 21
Views: 2164

Re: My retirement portfolio

I looked at some of the funds you have available in the 401(k). Not a very good selection of funds, but you've already been informed of that. I looked at the select aa balanced and growth funds (JELBX and JELGX). They're funds of funds. Meaning, their portfolio consist of other mutual funds. These particular ones appear to contain everything including the kitchen sink. Way too complicated for my tastes. Take a look at all the mutual funds they hold: Lifestyle Growth Portfolio That's ridiculous. There's no way you can understand all that. The link takes you to the investor class shares instead of the instutional class because for some reason, John Hancock doesn't show it in their institutional listings. But, they're the same underlying funds...
by Malachi
Tue Apr 24, 2012 9:11 pm
Forum: Personal Investments
Topic: Fidelity PAS
Replies: 8
Views: 1280

Re: Fidelity PAS

Perhaps, you can call Vanguard and talk with them about moving what you can "in-kind". As for the Strategic (for them) Advisory Funds, I don't know, depends too much on the specifics. Like how much of your portfolio is tied up in them? Are you currently taking distributions? If it's only been a couple of years, they might not have accumulated all that many capital gains and it might not be too bad to cash it out.

Just some thoughts.

As for managing your investments yourself, I'm confident you can do it. There's plenty of information here and on the Wiki for you to read and plenty of forum members to answer questions.
by Malachi
Tue Apr 24, 2012 8:17 pm
Forum: Personal Investments
Topic: Beginner long-term portfolio
Replies: 36
Views: 2377

Re: Beginner long-term portfolio

Malachi-- Using the strategy you just referenced, is the goal to worry about maintaining your AA over all of your accounts, and not worry about maintaining them in each? Your strategy would leave the Roth IRA strictly as bonds, and the 401k strictly as stocks. I have never thought about that strategy, although it obviously makes sense. If I am aiming for semi-early retirement (having the option to retire at 50, for instance), does it matter that my taxable account has the distribution that it does? I pulled the bonds out of the 401k and placed them in the Roth because the fact sheet I found had their ER at 0.52%. I tend to kick back against that sort of thing just out of principle! But, in actuality, if it was my portfolio, I'd probably ke...
by Malachi
Tue Apr 24, 2012 6:08 pm
Forum: Personal Investments
Topic: Beginner long-term portfolio
Replies: 36
Views: 2377

Re: Beginner long-term portfolio

OK, looking back at your original post, I see you gave us some numbers. So here's one possibility you might want to consider. Adding up your numbers I come up with the following: $10,200 - Taxable (46%) $9,100 - 401(k) (41%) $3,000 - Roth (13%) -------------------- $22,300 - Total Desired AA: 80% - $17,840 (stocks) with 70/30 domestic/international 20% - $4,460 (bonds) 56% - $12,656 (domestic) 24% - $5,352 (international) percent overall - percent account - dollars - fund 401(k): 41% - 100% -$9,100 - Dryden S&P 500 Index Fund Taxable: 16% - 35% - $3,556 - VTSMX - Vanguard Total Stock Market Index 30% - 65% - $6,644 - VGTSX - Vanguard Total International Market Index (goes over a little bit) Roth: 13% - 100% - $3,000 - VBMFX - Vanguard T...
by Malachi
Tue Apr 24, 2012 5:33 pm
Forum: Personal Investments
Topic: Beginner long-term portfolio
Replies: 36
Views: 2377

Re: Beginner long-term portfolio

According to the fund fact sheet I found for the SA/Templeton Foreign Strategy, it actually has a 1.03% ER. It also has 34% of it's holdings in U.S. stocks. So, it's not really a "foreign" equity fund. It appears to actually be a world equity fund.

Personally, out of those choices. I'd go with the following:

80% - Dryden S&P 500 Index Fund
20% - Core Bond Enhanced Index/PIM Fund

That gives you an overall expense ration of 0.32% (the bond fund has an 0.52% ER according to its fund fact sheet)

You can use your Roth for an international holding like VGTSX. And, tilt if you still want to tilt.