REBALNCE: TLH partner, BONDs

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RetireGood
Posts: 181
Joined: Tue Oct 07, 2014 2:02 am

REBALNCE: TLH partner, BONDs

Post by RetireGood » Sat Sep 23, 2017 7:43 pm

Hi

I would like to rebalance into Ex-US/ BONDS.

0) My taxable doesn't have VTIAX or VTSAX due to earlier TLH.
During my next rebalance or when adding new funds, should I instead VTSAX/VTIAX (instead of continue to US(VFIAX/VEXAX), Ex-US(VFWAX))?
Any general rules or complications that might arise later (i.e. if I already have the A<-->B positions in TLH tuple/triple of A<-->B<-->C.

1) My BOND component is just a stable-value fund (in 401K) and cash (in taxable). My 401k bond choices listed @ the end.
I will be rebalancing the whole of my US individual stock position INTC-INTEL 8.5% (to reach at least 20% BONDS ) in this rebalance move.
Question is, given current BOND market environment, should I rebalance to
  • - ALL into Stable Value ?
    - Else SV/Intermediate? 50/50 ?? or what %'s ???
    - Else get out of SV itself ? If so, intermediate or short-term? 50/50 ?? or what %'s ???.
---------------------------------------------------------------------------
Emergency funds: Yes
Debt: No
Tax Filing Status: Single
Tax bracket is FED: 28%, STATE:9.3% State
State of Residence: CA
Age: 40
Desired Asset allocation: 75% stocks / 25% bonds
Desired International allocation: (max, min) of stocks: (40, 20)

Current retirement assets:
------------Taxable------------
07.8% -- VFIAX-Vanguard 500 Index Fund Admiral Class -- 0.04
03.8% -- VEXAX-Vanguard Extended Market Index Fund Admiral Shares -- 0.1
08.3% -- INTC - Intel
01.7% -- FB - Facebook
16.2% -- NVDA - NVIDIA[/color]
24.5% -- VFWAX-Vanguard FTSE All-World ex-US Index Fund Admiral -- 0.14
00.8% -- LendingClub
00.7% -- CASH (excludes emergency fund)
----------------Tax-Deferred----------------- - 401k - (Company Match: 8000$)
09.0% -- VIIIX - Vanguard Institutional Index Fund Institutional Plus Shares -- 0.02
03.0% -- BlackRock Russell 2500® Index Fund -- 0.03
04.5% -- BlackRock MSCI ACWI ex-US IMI Index Fund -- 0.10
03.5% -- FTIPX - Fidelity® Total International Index Fund - Premium Class-- 0.1
10.7% -- RC STABLE VALUE -- 0.31
----------------Tax-Free----------------
00.5% -- FSIIX - Fidelity® International Index Fund - Investor Class - [HSA @Fidelity] -- 0.16
02.2% -- VEXAX - Vanguard Extended Market Index Fund Admiral Shares - [RIRA @VG] -- 0.08
00.4% -- VIIIX - Vanguard Institutional Index Fund Institutional Plus Shares - [HSA @HealthEquity] -- 0.42
00.07% -- CASH

Contributions
New annual Contributions:
-MAX 401k , Roth IRA, HSA
-~5% to invest

-------------
  • BlackRock U.S. Debt Index Fund - Intermediate-Term - ER: 0.025% - 30-Day Yield 1.27% 5/11/2015 / Weighted Avg Maturity 7.22 Years 3/31/2015 - Duration 5.09 Years
    YTD (Daily)* 2.09% | 1 Yr +1.55% | 3 Yr +2.89% | 5 Yr +2.50% | 10 Yr +4.46%
    The Fund shall be invested and reinvested primarily in a portfolio of debt securities with the objective of approximating as closely as practicable the total rate of return of the market for debt securities as defined by the Barclays Capital U.S. Aggregate Bond Index.
    RC Stable Value Fund - Stable Value - ER: 0.34%
    YTD +0.95% 1 Yr +1.87% 3 Yr +1.84% 5 Yr +1.83% 10 Yr +2.61%
    This fund seeks stability of principal and current income. Losses may result if insurers issuing contracts suffer insolvency or if assets are withdrawn in events such as plan changes or terminations, or changes in fund managers, contract issuers or governing law. In such cases, losses may occur if withdrawn assets are paid out at a current market value which is lower than book value.
Please let me know your thoughts.
Thank You
Last edited by RetireGood on Sat Sep 23, 2017 8:05 pm, edited 2 times in total.

livesoft
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Joined: Thu Mar 01, 2007 8:00 pm

Re: REBALNCE: TLH partner, BONDs

Post by livesoft » Sat Sep 23, 2017 7:51 pm

My thoughts are that your post is way, way, way, way, way too difficult to decipher. You got colors and CAPS and dashes and different font sizes and other things. Sorry, but them's my thoughts.
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RetireGood
Posts: 181
Joined: Tue Oct 07, 2014 2:02 am

Re: REBALNCE: TLH partner, BONDs

Post by RetireGood » Sat Sep 23, 2017 8:05 pm

livesoft wrote:
Sat Sep 23, 2017 7:51 pm
My thoughts are that your post is way, way, way, way, way too difficult to decipher. You got colors and CAPS and dashes and different font sizes and other things. Sorry, but them's my thoughts.
Thanks. Removed clutter :-)

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Kevin M
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Re: REBALNCE: TLH partner, BONDs

Post by Kevin M » Sat Sep 23, 2017 8:06 pm

For a stable value fund, the ER isn't that important. What is important is the yield, which is net of ER. Given that the 1-year return is 1.83%, I'd guess that the yield is in that ballpark, but this is something that should be published somewhere.

I think having all of your 25% fixed-income allocation in the SV fund is fine. Something in the 2% ballpark with no term risk (interest rate risk) and minimal credit risk is quite good for fixed income on a risk-adjusted basis.

Kevin
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livesoft
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Re: REBALNCE: TLH partner, BONDs

Post by livesoft » Sat Sep 23, 2017 8:10 pm

Your stable value fund is up less than 1% YTD, so I think it is a loser of a stable value fund. I would take the risk and use a bond fund. The YTD of the bond fund that you reported looks suspiciously low, so it is probably not really YTD, so what is it? First 6-months?
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Kevin M
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Re: REBALNCE: TLH partner, BONDs

Post by Kevin M » Sat Sep 23, 2017 8:16 pm

livesoft wrote:
Sat Sep 23, 2017 8:10 pm
Your stable value fund is up less than 1% YTD, so I think it is a loser of a stable value fund. I would take the risk and use a bond fund. The YTD of the bond fund that you reported looks suspiciously low, so it is probably not really YTD, so what is it? First 6-months?
Funny. YTD of the stable value fund makes it look like a loser, but YTD of the bond fund makes it look like YTD through June. I'd recommend trying to get the yield for the SV fund, but at least let us know the dates the YTD numbers are for.

Kevin
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livesoft
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Re: REBALNCE: TLH partner, BONDs

Post by livesoft » Sat Sep 23, 2017 8:19 pm

Yes, it is funny. I wouldn't use a SV fund unless the yield was at least 2.5% annually.
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RetireGood
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Re: REBALNCE: TLH partner, BONDs

Post by RetireGood » Sun Sep 24, 2017 6:00 am

Following is info from for the funds from the 401k www.

Stable Value Fund
Performance - AS OF 8/31/2017 | *AS OF 9/22/2017; Value is cumulative
YTD (Daily)* +1.36%
Average Annual Returns
1 Yr - + 1.88%
3 Yrs +1.85%
5 Yrs +1.82%
10 Yrs +2.55%
Quarter-End Average Annual Total Returns
1 Yr 3 Yrs 5 Yrs 10 Yrs Life
1.87% 1.84% 1.82% 2.59% 4.67%

BlackRock U.S. Debt Index Fund
Performance - AS OF 8/31/2017 | *AS OF 9/22/2017; Value is cumulative
YTD (Daily)* +3.35%
Average Annual Returns
1 Yr - + 0.51%
3 Yrs +2.99%
5 Yrs +2.45%
10 Yrs +4.40%
Quarter-End Average Annual Total Returns 1,3
AS OF 6/30/2017 ; Fund Inception 6/6/1996 | Expense Ratio (Gross) : 0.03% AS OF 12/31/2015
1 Yr 3 Yrs 5 Yrs 10 Yrs Life
-0.31% 2.82% 2.48% 4.48% 5.42%

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