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401k and todays stock market.

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    #16
    I think at 25, the current market rollercoaster shouldn't be a concern at all. You have many, many years to ride out any market correction. Over the next 40 years, I think you can be quite certain that whatever you buy today will have grown considerably, even if it falls in the short term. So just keep putting money in month after month. When the market is down, you're money will buy more shares and you'll benefit more when the market goes back up. Congrats on funding a Roth and a 401K at such a young age.
    Steve

    * Despite the high cost of living, it remains very popular.
    * Why should I pay for my daughter's education when she already knows everything?
    * There are no shortcuts to anywhere worth going.

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      #17
      Keep putting more money into 401k, come back in 3 years, and let us know if you are still complaining.

      I remember being 3 years into investing when the 2000-2002 bear hit and took 50% of my assets into thin air. I had $7000 at the time.

      I now have more than $160k set aside 7 years later. I know I did not put in 160k into the account, so I am doing quite well.

      Comment


        #18
        Wait a minute, people.

        While I agree that he should be thinking long term. . .I too would be wondering why I haven't made money in this bull market.

        The last time we took a poll here, we were all up a considerable amount. I know the recent months have been jumpy but I am still probably up around 20-30% for the year as a whole (up 10% on silver, 20% on domestic, and 40% on international).

        The OP may have a penchant for picking sucky funds.

        If that's the case, stick with indexes then you don't have to wonder whether your fund manager is a chucklehead or not.

        The OP also wrote:

        I just hate losing so much money.
        If this is really a true statement, then perhaps the Pundit Advice of "think long term and ride out losses" isn't really appropriate and he should be in something more conservative, like the Vanguard Wellington fund. Yes, he's 25 but if he's going to get weirded out on bad years (and the poster sounds weirded out), then he should probably go 50% bonds and 50% stocks.

        As some general advice - to the original poster - you have way too many funds IMO.

        Compress it to 4 or 5.

        This is the problem with being overdiversified - you won't get to ride bull markets. I used to only have 2 funds (an international and a domestic). Now I have 3. . .there's not much reason to own beyond 5 IMO.
        Last edited by Scanner; 11-13-2007, 07:13 AM.

        Comment


          #19
          OP asked a question and many of us responded to the question.

          I do agree with scanner though... maybe OP needs to think about risks and risk tolerance.

          I see his selections and I own some of the funds... my opinion is he needs more knowledge of asset allocation and I need to understand some of the funds he has better as well.

          Comment


            #20
            Here's a suggestion (but please do what you are comfortable with and figure out how you want your assets allocated as JimOhio suggested along with what risk you want to take):

            If you are MODERATE
            25% Vanguard Total Bond Mkt Index Inv
            25% Vanguard 500 Index Fund Inv - VFINX
            25% Janus Worldwide -JAWWX or Vanguard International Growth Inv
            25% Vanguard REIT Index Fund Inv - VGSIX

            If you are AGGRESSIVE
            33% Vanguard 500 Index Fund Inv - VFINX
            33% Janus Worldwide -JAWWX or Vanguard International Growth Inv
            33% Vanguard REIT Index Fund Inv - VGSIX

            This is only what I would do. But I am not you and you are not me. But I think you are looking for suggestions and viewpoints and I'll offer one.

            Comment


              #21
              Here our my choices for 401k.

              Vanguard LifeStrategy Consrv Grwth - VSCGX
              Vanguard LifeStrategy Growth Fund - VASGX
              Vanguard LifeStrategy Income Fund - VASIX
              Vanguard LifeStrategy Mod Growth - VSMGX
              Vanguard Federal Money Mkt Fund - VMFXX
              Vanguard High-Yield Corp Fund Inv - VWEHX
              Vanguard Inter-Term Treasury Inv - VFITX
              Vanguard Total Bond Mkt Index Inv - VBMFX
              Vanguard Wellington Fund Inv - VWELX
              Baron Asset - BARAX
              Baron Growth - BGRFX
              Royce Total Return Serv - RYTFX
              Vanguard 500 Index Fund Inv - VFINX
              Vanguard Growth Index Fund Inv - VIGRX
              Vanguard PRIMECAP Fund Investor - VPMCX
              Vanguard Selected Value Fund - VASVX
              Vanguard Windsor II Fund Inv - VWNFX
              Janus Worldwide -JAWWX
              Vanguard Emerging Mkts Stk Idx Inv - VEIEX
              Vanguard International Growth Inv - VWIGX
              Vanguard REIT Index Fund Inv - VGSIX


              Moderate (70-30 equity-bond, 20% international)

              VFINX 30%*
              VASVX 10%
              RYTFX 10%*
              VWIGX 15%
              VEIEX 5%
              VBMFX 30%

              Aggressive (100% equity, 25% international)
              VFINX 45%*
              VASVX 15%
              RYTFX 15%*
              VWIGX 15%
              VEIEX 10%

              * are funds I own.
              Last edited by jIM_Ohio; 11-13-2007, 07:48 AM.

              Comment


                #22
                Originally posted by Scanner View Post
                if he's going to get weirded out on bad years (and the poster sounds weirded out), then he should probably go 50% bonds and 50% stocks.

                As some general advice - to the original poster - you have way too many funds IMO.

                Compress it to 4 or 5.

                This is the problem with being overdiversified - you won't get to ride bull markets. I used to only have 2 funds (an international and a domestic). Now I have 3. . .there's not much reason to own beyond 5 IMO.
                I tend to agree. Another problem with too many funds is you aren't necessarily more diversified. You end up with a lot of overlap - multiple funds holding the same stocks. Without even looking, I'd suspect that Growth Index, Life Strategy and 500 Index have a lot of the same holdings.

                I'd run this through Morningstar's portfolio x-ray feature (free at their site) and see what it says.
                Steve

                * Despite the high cost of living, it remains very popular.
                * Why should I pay for my daughter's education when she already knows everything?
                * There are no shortcuts to anywhere worth going.

                Comment


                  #23
                  Originally posted by Scanner View Post
                  As some general advice - to the original poster - you have way too many funds IMO.

                  Compress it to 4 or 5.

                  This is the problem with being overdiversified - you won't get to ride bull markets. I used to only have 2 funds (an international and a domestic). Now I have 3. . .there's not much reason to own beyond 5 IMO.
                  IMO it's not so much that the OP has too many funds, the problem is there's really not much diversification between most of them. There's a lot of overlap.

                  Mistawho, the number of funds you hold doesn't mean you're properly diversified.
                  The easiest thing of all is to deceive one's self; for what a man wishes, he generally believes to be true.
                  - Demosthenes

                  Comment


                    #24
                    I agree the OP is not properly diversified. Don't see enough international and I would question the amount of small caps. Overwieghted big time on large cap growth.

                    That being said, I own 6 funds in my Roth, plus another 6 in my 401k and another 6 in my wife's 401k, plus two more in my wife's Roth.

                    Large Cap Growth
                    Large Cap Value
                    Mid Cap
                    Small Cap
                    International

                    in each... plus a bond fund in mine, plus a company stock fund in hers... to some people 6-8 funds is OK if they are selected properly.

                    Comment


                      #25
                      Originally posted by kv968 View Post
                      IMO it's not so much that the OP has too many funds, the problem is there's really not much diversification between most of them. There's a lot of overlap.
                      Same point I was making. I have more than 4 funds, but they are different - large company growth, small company value, international, real estate, gold and minerals, healthcare sector fund, bond index. There isn't much overlap
                      Steve

                      * Despite the high cost of living, it remains very popular.
                      * Why should I pay for my daughter's education when she already knows everything?
                      * There are no shortcuts to anywhere worth going.

                      Comment


                        #26
                        Originally posted by disneysteve View Post
                        Same point I was making. I have more than 4 funds, but they are different - large company growth, small company value, international, real estate, gold and minerals, healthcare sector fund, bond index. There isn't much overlap
                        I didn't get to page 2 of the post and read your reply until after I had already posted mine. Sorry about that Steve. Hey, at least we agree
                        The easiest thing of all is to deceive one's self; for what a man wishes, he generally believes to be true.
                        - Demosthenes

                        Comment


                          #27
                          I am 29 and don't understand peoples thinking sometimes. I still have a majority of my life to invest so I am kinda hoping for a big recession. Why? If the market goes really high then my dollar cost averaging is buying less shares each time the market goes up while if the market goes down I will be buying more shares. Yes I will see great returns if the market goes up now but with my retirement only around $120,000 this would be very shortsighted thinking. I would much rather see a nice drop in the market now with my contributions buying a lot more shares and in around 20 years see the market skyrocket. It would be much nicer to see the market go up when my portfolio is in the millions. I still say that investing is easy in theor, buy low sell high, but to actually do it is a much bigger problem. One of those reasons it is difficult is human emotions.

                          Comment


                            #28
                            Originally posted by rooskers View Post
                            I am 29 and don't understand peoples thinking sometimes. I still have a majority of my life to invest so I am kinda hoping for a big recession. Why? If the market goes really high then my dollar cost averaging is buying less shares each time the market goes up while if the market goes down I will be buying more shares.
                            Ding ding ding! We have a WINNER!

                            Comment


                              #29
                              Heh, recessions are great for people with money to invest. Bad for people who owe money. Although, to be fair, dollar cost averaging is something that has been brought up here before, so that's why I didn't mention it. I was JUST telling a buddy of mine that I'm ready for a shopping spree if or when recession hits.

                              Comment


                                #30
                                Vanguard PRIMECAP VPMCX

                                what do you think about Vanguard PRIMECAP VPMCX instead of VFINX?

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