Portfolio Design/Management

Question for Statsguy/others on "how much is enough"

Mcgragor — Sun, 15 Nov 2009 19:16:45 GMT

I was reading about the fellow who wants to retire in 2 years with 1 mil and 50k income needs and I noticed Statsguy mentioned that his retirement income needs are substantially less.

I was curious to see if you wanted to provide your approximate need as I feel that is one area that isn't considered enough when figuring what one really needs to retire.

To set the stage, my wife and I have always worked blue collar type jobs and although we both have ended up in decent careers we have basicly lived on one income and saved most of the rest.

I was looking at our budget and realized that our income needs are less than 30K per year. We live very modestly.

design a taxable retirement portofolio

Steven88 — Fri, 13 Nov 2009 22:22:46 GMT

I have posted in this forum recently asking for advice on my retirement portofolio in tax-deferred accounts. I am developing a plan for implementing some small changes. Thanks for your suggestions.

As I mentioned earlier, I plan to stop contributing to the company sponsored Deferred Compensention Plan (DCP) as it is not a qualified plan like 401K. Even though it offers great tax deferring advantages (and no annual contribution limits), I may still have the risk of losing this money in the unlikely event that company goes bankcrupt. I will continue to max out the 401k contributions.

For the taxable retirement account, I plan to contribute ~6000/month for the next 10-15 years. I already have some cash built up and a good amount of company stock (a large growth stock , like to keep it as they are grants with good dividents). I understand that some investments are bad choices for taxable accounts. I plan to have a 60/40 (equity/fixed income) allocation, perhaps with some tax-managed equity funds (US, & ex US), muni's and tax-exempt bond funds, etc. I really like Vanguard's tax managed funds, but they all have $10,000 min. Any suggestions? Funds with less min investment? portofolio considerations? Or should I continue to investment in the DCP plan and not worry about taxable account?

Thanks in advance for your help

Steve

Mikes425

rascfw — Wed, 01 Jul 2009 04:31:54 GMT

Mike, this is in response to your Qs in my KISS article,
http://news.morningstar.com/articlenet/article.aspx?postId=2669127#page=1...

...I decided this year to drop my advisor and go it on my own. One of the reasons was what I considered unnecessary "bloat" in the number of funds advised to be held for sufficient diversification...
...I would welcome your thoughts on my shared portfolio which is a Taxable account and any thoughts on ways I might approach paring down the quantity of funds being used. I am a moderate investor at 50 y/o and looking about ten years out for a retirement scenario...
... I thought this would be a good time to look at not just putting that into higher-yielding, relatively 'safe-haven' positions, but also the simplification of my holdings to reduce total number of individual funds.
...your take on any obvious ways where I could look at consolidating for fewer holdings. My SEP-IRA is only a tiny percentage of assets vs the Taxable. All the more reason that I think expense reduction through a Simpler mix of fewer funds is a wiser approach.

Well, Mike, you first need to understand that I am not an advisor. All I can give you is my personal opinion.

Note --since you mention mutual funds, I assume that you are solely focused on MFs.

Why don't you first tell ME:

What are your goals? What do you perceive to be the ideal allocation in your porttfolio? [ie the diversification/weighting you want with stocks, bonds, REITs, commodities and/or precious metals] Then decide how you prefer to allocate domestic stock vs foreign and/or emerging market stock and domestic bond vs foreign and/or emerging market bond.
What kind of investor are you? Do you emphasize equity-income total-return or are you more growth-oriented? Once you know how you want to diversify your portfolio, you need to find investments YOU are comfortable with.
Once you've developed your ideal allocation and diversification you want for your portfolio and know the kinds of investments you want to own, then you should identify which criteria are important to you when choosing a MF... ER, distribution yield, M* risk/reward ratings, etc.

Here's a few more Qs for you, Mike:

You say you feel that there is unnecessary "bloat" in the number of funds you own in your taxable account. Sit back and think hard about this one... now that you have an idea about your idealized diversification and allocation, how many funds do YOU think you need? Look at the funds you own in your taxable account, list them by the various categories and then decide which areas might be over-emphasized. Once you identify the "bloat"ed areas, pick 'n choose which funds you want to keep.
This is a taxable account and I'm sure that you are aware that selling anything in it will be a taxable event. The best advice I've run across before is to sell when your investment in a fund is a long-term gain (lower tax level for LT capital gains) and you should try to balance gains from one MF with losses from another.
Don't be an all-or-nothing investor. You DON'T have to buy or sell everything all in one blow. If you have gains in your taxable account, try to balance out your LT and ST profits and losses in selling various MFs. If the net impact are taxable profits, decide if you're able to handle the taxes in one year. If not, spread out selling unwanted MFs over a few years.

unnecessary "bloat" ... paring down ... reduce ... consolidating
ALL of these terms indicate that you want to shrink your MFs down to fewer positions. You are in the driver's seat on this one, Mikes425. It is up to you to decide what funds to keep and which ones to sell --and how many MFs is a reasonable minimal number of MFs you have to own.

I am not a CPA, so please doublecheck possible tax consequences before you act.

Here's a few links showing 2 of my shared portfolios whose allocations might interest you... one is a 30/30/40 domestic stk/int'l stk/total-return bond mix and the other is my HO Contest portfolio for 2009:

30/30/40 KISS 1/4/99 http://socialize.morningstar.com/NewSocialize/Portfolio
Sharing/SharedPortfolioSnapshot.aspx?q=32E8DF24F8FF4589 . HO Contest --Susan (2009 only) http://socialize.morningstar.com/NewSocialize/Portfolio
Sharing/SharedPortfolioSnapshot.aspx?q=D4E1E746B3EB8181 . I hope the other posters here chip in with their advice, too. The more the merrier! I look forward to getting some feedback soon, Mike.

Regards,
Susan

Foreign Stock tax question?

brownsca — Mon, 02 Nov 2009 03:52:19 GMT

Does anyone know how investing with foreign exchanges differs from investing with local (in my case US) exchanges? Fidelity has recently made it possible to invest directly in foreign markets (i.e. one is no longer restricted to ADRs) and you can actually hold foreign currencies and settle trades in those currencies (I understand that ETrade has been doing this for some time as well).

Are capital gains and dividend taxes owed to the foreign government when trading in this manner? I happen to be interested in a few Canadian banks as dividend plays and I was considering investing in them directly (to gain exposure to the CDN which I understand the ADRs will not give me since they are dollar denominated).

Will the Canadian government be given my SSN and will they be sending me the equivalent of a 1099?

Thanks in advance.

Barry

Port Design/Mgmt Forum 2000 post milestone...

retired at 48 — Tue, 17 Nov 2009 02:48:14 GMT

I note this new forum just had posting number 2000. Thanks to everyone who has been participating here. And a special remembrance to John Walter Russell, an early supporter of this Forum.

Here are some excerpts from initial threads of what the forum is trying to accomplish:

From M* Darrin:

Welcome to the new Aggressive Portfolio Management forum. This new forum is targeted towards experienced, more aggressive investors. Focus will be on the key and necessary elements of any financial plan, namely, asset allocation, portfolio makeup and on-going portfolio management.

Feel free to discuss setting stock/bond allocation percentages; selecting asset classes and sectors; choosing stocks, ETFs and active or passive funds to fill the allocations; establishing buy, sell, timing or rebalancing criteria; and assessing valuation levels and allocation plan changes.

A need exists whereby these topics can be discussed openly, in a civil manner, with a goal of a learning experience for all. Reviews in depth are encouraged.

An adjunct is the thread titled: R48, Norbert & Chin’s Investment Challenge whereby actual portfolios are maintained and changes discussed real time, utilizing the Portfolio Manager and Portfolio Sharing tools.

There are many interesting investment styles and methods being utilized. All are encouraged to bring them to this forum and share with a very knowledgeable group of posters.

Regards,

M*_Darrin

From retired at 48:

Passive investing on another forum is generally thought of as selecting an asset allocation, fill it with index funds, invest new monies (including lump sums)immediately, and buy and hold, forever...and lately, some "Plan B's".

Anything differing than that could be considered "aggressive". Yes, it could be called "active"...or "timing"...all buzzwords in certain circles.

So I would consider if one is changing their asset allocation percentages, (other than formulaic ones like age in bonds), ever, this is the forum to discuss it, without being clobbered with cliche's.

If one is considering buying actively managed funds, this is the forum to discus not only the purchase, but how it fits.

If one is considering market "timing" to any extent, this is the forum.

If one's personality makeup is such that they cannot buy and hold, forever, this is the forum.

If one considers it OK to invest in certain sector funds, like energy and healthcare, or precious metals/mining, this is the forum.

If one considers "valuations matter" in managing their portfolio, this is the forum.

If one does more than simple rebalancing to their portfolio, such as exiting REIT funds completely, this is the forum.

If one plans to slice/dice their portfolio so that the affects of future "bubbles' may be mitigated, this is the forum.

If one wants to incorporate momentum investing into their portfolio, this is the forum.

If one wants to incorporate unique buying/selling strategies (like Pyramiding Up) into their portfolio, this is the forum.

If one considers long term US Treasury bonds may be in a bubble, and is considering exiting them completely, this is the forum.

If one wants to develop investment strategies that consider the likelihood of, at best, a flat market for the next 5 to 10 years, this is the forum.

If one wants to explore ways to take advantage of the very high volatility underway in markets, this is the forum.

If one wants to explore ways to invest when nearing retirement that both reduces max drawdowns/volatility yet are satisfied with slightly below market returns in exchange, this is the forum.

Perhaps it can be a forum without hundreds of daily original thread postings, permitting a more in-depth review of selected topics.

Perhaps those Bogleheads who openly admit they struggle with buy and hold, forever, or with Plan B's, and those who allocate a certain percentage of assets towards alternative styles, can venture to the new forum for open discussions of alternate approaches, both aggressive and more conservative approaches.

Perhaps this new forum can tie-in all the various other forums which seem very topically specific, and gets to the heart of the matter, namely, portfolio management.

Perhaps we will all learn more. I hope to, and hope to share some of my investing experience with others.

The forum has evolved into one of helping any investor, at any experience level, with developing their portfolio and how they can best manage it.

Thanks to all for participating...

R48

Graph a Portfolio.

Figurethefolio — Thu, 19 Nov 2009 16:25:24 GMT

It would be useful to be able to see a YTD graph of my porfolio. We have the X ray tool. I know that I can drill down on each investment for a graph but a total would be nice.

When to sell?

nimo955 — Thu, 19 Nov 2009 15:46:09 GMT

Here is a quote from a recent Fund Spy article, "The Fund Manager of the Decade Finalists":

"Bond funds were a bright spot over the past 10 years, but it was a brutal time for equity investors. Not one, but two severe bear markets lasting roughly two years each decimated investment accounts. As we near the decade's end, broad equity market indexes show flat to negative returns for the entire 10-year stretch."

I know how everyone discourages any form of market timing, but I just don't see the benefit of a "buy and forget" strategy. It seems to me like you just watch your gains go up, but don't do anything to capitalize on them and just eventually lose them. What are some strategies people use to determine when to sell and when to buy back in?

R48 - Purchase of DEM

Racqueteer — Tue, 17 Nov 2009 16:01:12 GMT

Quick question for you... DEM is an obvious choice as a dividend payer for your retiree account, but this looks to be an initial purchase. My question is, why now? Was there something about DEM specifically that made it compelling at this point, or you were rolling over some other investment, or...? Full disclosure, I own some from a few months (and a lower nav) back.

Question for R48/anyone else interested

beamray — Mon, 16 Nov 2009 14:49:06 GMT

Hi: Question on your early retiree portfolio.

You have 72.31% in Vanguard short term investiment grade, what is the stragety to exit/protect for loss of principal when the Fed raises short term rates.Rates may also rise without Fed action.

When the Fed starts they may rachet fast,and in larger amounts than anyone expects.

I am 61 early retired with none COLA pension, plan to take SS at 62,wife has SS now. When I start SS will have enough cash flow to cover monthly expenses,have enough free cash in bank to last until SS starts.

My current AA in TIRA at Fido.

TGLMX 11%

VFICX 11%

VFIIX 7%

VFSTX 7%

Lilly stock 8%

Cash 56%

I know I have way too much in cash would like to put more into VFSTX, need to know what to do when.

I can see a few options myself but would like your take on this.

1 Go to cash before fed raises rates,if they tip their hand. Keep in MM until rates rise then shift to intermediate bond funds,or stay in MM if rates rise enough.

2 Ride out the rate increase,recover NAV loss with increased distributions.

Actually I think I might remember reading one of your posts that said you really don't have this much in VFSTX it is just that M* has no way to enter MM into a portfolio, but regardless need to do something with this cash besides MM.

Thanks, of course comments from others on the board are welcome.

Old Mike

R48, Norbert & Chin’s Investment Challenge

retired at 48 — Sat, 13 Sep 2008 17:47:10 GMT

During the early part of this year, several postings presented different investment styles, from indexing to momentum investing to individual stock buying. At times, the posts became contentious, and retired at 48 offered that an ongoing super bowl of investments would help all parties see the styles in action. Entrants would identify portfolios to be tracked, the strategy and investment styles involved, and why any portfolio changes were made. Norbertc and chinwhisker were early challenge entrants, followed by others, as this is open to all. Portfolios are listed on the Morningstar Portfolio Manager site, accessible by clicking on the (suitcase) box adjacent to each entrant’s moniker/ name. We are not taking leveraged, gambling positions to “win a contest”. Rather, the goal here is to make each his/her best current desired portfolio and allocations, and thus serve as a learning experience for all visiting this forum. For example, we have portfolios for young investors with about $40,000 saved; early retirees who may have just received a $400,000 lump sum; traditional diehard philosophy investors with asset allocated, diversified portfolios, and portfolios for those who allocate some to more aggressive approaches. Hope you enjoy this thread.

Retired at 48 chinwhisker norbertc

Edit by M*_Darrin: See all of the above referenced portfolios here, or read on below for context. Learn more about sharing your own portfolio, complete with a Morningstar Rating, by clicking here.

Asset Allocation Rebalancing: Lump Sum or DCA?

Callalily — Mon, 26 Oct 2009 05:03:27 GMT

I finally decided on what my asset allocation is going to be and am trying to decide whether to do it all in one go or dollar-cost-average. I have about $16,000 to reallocate. Now that I know what to do, I don't know when to do it!

Hope wiser minds can help.

one million to invest

zoobie — Tue, 10 Nov 2009 03:46:30 GMT

48 yrs old,,two young children,,50,000 yearly personal overhead/budget,,,wish to retire in 2 yrs,,one million to invest,,believe stocks and bond are overvalued,,money markets dont earn,,,uninvested may last 15 years even w mild inflation,,,what to do? suggestions

how to show annualized returns

RichardLion — Sat, 14 Nov 2009 16:09:01 GMT

On Morningstar.com I see how to show returns over various time periods, for ex. 10 years. I have owned some stocks for 1 year, some for 3 years, some for 12 years, etc. I want to have the site divide my total return on each stock by the number of years I have owned that stock, to generate annualized returns. Can that be done?

Portfolio Beta

ronube — Thu, 12 Nov 2009 23:24:40 GMT

most definitions of portfolio beta tell me to use a wtd avg calculation of each individual stock or funds beta. wouldnt it be better to look at the actual portfolio movement vs benchmark and determine the bata that way. the wtd avg may not incorporate the fact that 2 stocks moving in opposite directions will cancel each other out when in the same portfolio. this seems to be a big difference to me. should I , or can I calculate a true portfolio beta for a prospective portfolio?

Latest Moving average data - S&P500

Mr. Ed — Mon, 02 Nov 2009 09:54:32 GMT

S&P500 has penetrated the 50-day moving average. Still quite a distance to the 200-day average, though.

Most index funds have the same pattern at this time.

What other factors should I be looking at?

Advice - Suggestions on Portfolio "Reconstuction"

FundSeeker — Thu, 29 Oct 2009 23:11:05 GMT

I will try to give what information I have seen some of you (R48, NorbertC, Limo, DrH,...) ask others, in order to humbly receive any advice/suggestions.

Married, 46 yrs. old, not working -- right now. Just finished Graduate school.

1) This money is in a taxable account. Its "seperate property" -- inheirited, never comingled, all mine -- not his, and will stay that way. (No offense to my hubby, he's a great man♥)

2) This money is intended for use during our retirement years (say 15-22 years from now). It will not be added to (no new money).

4) The balance is around $210k (hurts just to type that).

5) We have sufficient income, <100k on our mortg., husband has a secure job (well... you know what I mean) -- a 401k with horrible choices (see my other post) and an IRA.

Since we have his income and retirement accounts and I have a modest monthly income from some mineral interests (waiting for another Spindletop), I'm not afraid to be reasonably aggressive with this account.

I would like to keep around 30k in cash for future purchases or emergency, if needed. Currently, the portfolio is remnants from what the broker had me in and some funds that I picked in late June and July, and 2 stocks.

I have a minimum understanding of bonds in terms of what to choose, and how and when to use them (or not). I am learning. I'm trying to read/learn all I can on M* and these boards, other web sites, etc. There's such a tug-o-war about where the market/economy is headed, I feel rather frozen in terms of how/where/when to start toward organizing this portfolio into something sane.

Thanks in advance...

Deb

Spouse / your 401k - as one portfolio or not ?

vijisubra — Tue, 27 Oct 2009 19:51:08 GMT

Both me and my spouse have 401k with fidelity.

Do we have to design one portfolio for each or combined and view as one portfolio ?

Are there any advantages in doing one over the other.

thanks and appreciate all the help/ suggestions.

regards,

Viji

Beginning an asset allocation

spendispencer — Tue, 06 Oct 2009 05:19:09 GMT

Hello all. First, I would like to thank all who have contributed to this forum. I have thoroughly enjoyed reading everybody's opinion whether I agree with it or not.

Now on to my problem at hand. I have recently inherited a large amount of money (more than 400% my current portfolio) and I don't know how to best integrate it into my current portfolio or asset allocation. In the past I have merely added whatever amount I could afford that month to my portfolio but with this large of an amount of money I am worried that it would skew my dollar cost averaging up beyond all proportion.

Soo basically, do I keep this money in cash and slowly add to my positions as I normally would OR just add the money now so that I don't miss out on any sort of appreciation? All and any ideas are welcome! Thanks in advance!

portfolio design versus smart marketing

statsguy — Fri, 23 Oct 2009 19:21:30 GMT

I thought this was a pretty good read from seekingalpha.com that others on this forum would find interesting.

Viewing the Markets in Context

Here is the part that caught my eye... you can follow the link for the rest of the article (bolding is all mine)...

Twenty-first-century investing is all about predicting. Developing intuition about markets, asset classes and how they interact is too often overlooked, if not ignored outright. That's a mistake for strategic-minded investing, albeit a mistake that's understandable in the crowd's rush for quick and easy profits.

It's hard to miss all the self-proclaimed seers running around espousing magic formulas and the three most-important investment gauges that insure big gains. Rarely do you hear of the dark side of these easy rules, such as the possibility that maybe they're byproducts of data snooping, survivorship bias and other gremlins that harass seemingly flawless assumptions.

Stats

Retire by 50 portfolio critique

jd2008 — Mon, 26 Oct 2009 00:40:11 GMT

Hi-

I would like to hear some comments about the following portfolio. My wife and I (early to mid thirties) have been aggressively DCA'ing into these funds in our 401K, Roth IRA, taxable, and ESA (have a 1 year old son) accounts. We already have a house, an emergency fund, and no real debt outside of a very manageable mortgage. As you can see from the fund choices, we are looking for well above market returns in the long run and aren't too afraid of short term volatility (as rather young accumulators we saw last bear market as an opportunity to continue contributing at lower valuations). The ultimate goal is to strive to be financially independent before 50!

Thank you.

Whole portfolio breakdown:
1) 17% Small Cap Value - mostly 401K proprietary small cap value fund - using VISVX as proxy, plus small positions in RYVPX and BRSIX

2) 15% CGMFX (CGM Focus Fund) go anywhere hedge-fund like fund with manager having great long term track record

3) 12% FAIRX (Fairholme Fund) - value investing and capital preservation

4) 7% BAM (Brookfield Asset Management) - real assets - commercial real estate, hydro-power, timberlands

5) 9% LUK (Leucadia) - small version of Berkshire Hathaway, private equity

6) 4% International Large Value - DODFX (Dodge and Cox International Value) + 401K proprietary fund - using VTRIX as proxy

7) 5% International Small Cap Value - DLS (Wisdom Tree International Small Cap Dividend Fund) + ARTKX (Artisian Small/Medium International Value)

8) 18% Emerging Markets Large Value - DEM (Wisdom Tree Emerging Markets Equity) + AEMGX (Acadian Emerging Markets) + LZEMX (Lazard Emerging Markets Value)

9) 13% Emerging Markets Small Value - DGS (Wisdom Tree Emerging Markets SmallCap Dividend Fund)

Help fixing my portofolio

Steven88 — Tue, 27 Oct 2009 04:10:22 GMT

For my retirement savings, I have ~20 funds in 3 places: a rollover IRA, 401K and DCP. I did not do any research and just selected a few funds from each plan at the beginning and auto piloted for the last 6 years. Now I like to simplify/consolidate and most importantly to ensure I have the right asset allocation/balance. I won't need this money for ~20 years, and I will continue to max my contributions. Here is what I have (very messy). Any critiques and suggestions will be greatly appreciated.

Name	Ticker	% Weight
PIMCO Total Return Admin	PTRAX	27.92
Fidelity Intermediate Bond	FTHRX	2.54
Fidelity Inflation-Protected Bond	FINPX	2.28
Fidelity Capital & Income	FAGIX	1.69
Dodge & Cox Balanced	DODBX	2.43
Fidelity Balanced	FBALX	4.76
Fidelity Contrafund	FCNTX	6.58
Fidelity Freedom 2025	FFTWX	2.23
Fidelity Capital Appreciation	FDCAX	1.63
Fidelity Growth Company	FDGRX	2.38
Fidelity Export & Multinational	FEXPX	4.77
Janus Research Core J	JAEIX	9.25
American Funds Growth Fund of Amer R5	RGAFX	4.55
American Funds Washington Mutual R5	RWMFX	2.42
Vanguard Institutional Index Instl Pl	VIIIX	0.76
Vanguard Extended Market Idx Instl	VIEIX	1.23
BlackRock Mid-Cap Value Instl	CMVIX	1.01
Fidelity International Discovery	FIGRX	1.61
American Funds EuroPacific Gr R5	RERFX	7.29
American Century Intl Growth Inv	TWIEX	1.33
Third Avenue Value	TAVFX	2.55
Abbott Laboratories	ABT	7

vanguard alternative

playbook — Tue, 27 Oct 2009 17:19:01 GMT

If one had a $1,000,000 portfolio such as the following and wanted to transfer it all to Vanguard, what funds in that family might be comparable?

Tibix 30%

Caibx 30%

Ancfx 10%

Cwgix 10%

Fkinx 10%

Amecx 10%

Cash and equivalents need not be considered as there are additional funds in CD's, MMF, and ultra ST bond funds to supplement income for 7-10 years if current dividend support should fall.

Thanks,

playbook

Yahoo S&P 500 historical data is inconsistent today

acamus — Sun, 25 Oct 2009 20:39:13 GMT

Just a heads up. I looked at the yahoo finance historical data for the S&P 500 (they use ^GSPC as the symbol).

I started Jan 3, 1950 through to the present day and went to the last page. It starts in 1969. These are the earliest two records as displayed on the web page:

31-Dec-69	16.85	16.85	16.85	16.85	1,890,000	16.85
31-Dec-69	16.66	16.66	16.66	16.66	1,260,000	16.66

Why are there two entries for Dec 31, 1969? And if you keep going forwards in time through the records there are a bunch of Dec 31, 1969 records.

Then I used the "download to spreadsheet" feature. The earliest records are from Jan 3, 1950 and I think these ones are right:

1950-01-04,16.85,16.85,16.85,16.85,1890000,16.85

1950-01-03,16.66,16.66,16.66,16.66,1260000,16.66

Notice the prices for 1950 are exactly the same as the ones claimed on the web page for 1969. I suspect download to spreadsheet works but the web page itself is broken.

I wonder how one files a bug on yahoo finance?

Regards,

200 day moving average

seh1981 — Wed, 21 Oct 2009 14:48:53 GMT

I'm an experienced investor who has always believed in asset allocation as the primary way of managing risk in a portfolio. I tend to be very skeptical of technical analysis such as 200 day moving average, however, I am open minded enough not to totally dismiss without considering possible merits of other strategies. Having read several recent threads about using 200 day MA, I have created a portfolio today to try it out and would appreciate feedback of others...

Name of portfolio is "3fund moving average". My initial investment is 30% Consumer Staples Select Sector Spider (XLP), 30% ishares MSCI Emerging Markets (EEM) and 40% ishares Barclays Short Treasury Bond. My thinking in using a consumer staples fund and an emerging markets fund for my stock allocation is that using 5, 10 or even 15 different funds with varying degrees of risk (large/small cap, foreign/US, developed/emerging, etc) probably doesnt give you any more diversification than just using 2 funds at opposite ends of the risk spectrum. Also, for my test, using just 2 funds will keep things much simpler. My use of the short treasury fund was to create a traditional, moderate 60/40 allocation that I could compare to other 60/40 portfolios I have recently created.

I am going to consider my original allocation "neutral" and going forward I will change allocation based on the 200 day MA. What I am not sure of is what exactly I will do when one or both funds breaks through its average. Will I sell all of that fund on the day it breaks through? Do you wait until it has broken through for a certain amount of time or by a certain percent? Do I sell out completely or in increments? Do I immediately buy back as soon as it breaks back above?

I would appreciate any feedback...

Beginner's Luck?

temery — Sat, 17 Oct 2009 13:26:25 GMT

I am now 48, and started saving $1,000 a month in a 403b(7) account through my employer (I am a teacher) in the fall of 2007. I up'd this amount to $1,500/month this year ("catch up years"), and just last week opened a Roth IRA ($2,500).

I selected funds with very little knowledge. Initially they tanked, but I stuck with the funds. They seem to be doing fairly well at this point.

My plan is to be aggressive (I am single and make pretty good money, all things considered). Below is a snapshot of my holdings ... Does anyone have any suggestions, thought, concerns, or advice?

(BTW - My plan is to retire in ten years, but not tap the money until I am in my 60's)

Name	Ticker	% Weight	Morningstar Rating
PowerShares DB US Dollar Index Bearish	UDN	6.95
Vanguard Capital Value	VCVLX	31.49	2
Vanguard Emerging Mkts Stock Idx	VEIEX	46.03	3
Vanguard International Value	VTRIX	3.82	4
Vanguard International Growth	VWIGX	11.71	4
My stuff	My stuff	100	2.83