critique my portfolio

**ThriftoRama** · 03-25-2008, 05:40 PM

I'm not sure you can roll over a 401k unless you leave your job. Hubby and I thought about it because his 401k options are so bad, but it looks like we're stuck unless he quits.

Our strategy has been to go with the lowest cost, most reasonable funds he has to choose from.

I wouldn't cash out now anyway. Not in a down market. Better just to hold tight.

**disneysteve** · 03-25-2008, 05:55 PM

Originally posted by ThriftoRama View Post

I wouldn't cash out now anyway. Not in a down market.

So true. That is one of the biggest investment mistakes people make. Buy high and sell low. That is a recipe for certain disaster. Yes, the market is down and may not be done falling. If you get out now, you are locking in what are only paper losses right now. Assuming you have many years before retirement, now is a time to continue investing, buying shares at depressed prices and being better positioned to benefit from the eventual recovery.

If you are nearing retirement, that's a whole different situation but since you are 100% stock, I'm guessing you are not.

**m3racer** · 03-25-2008, 06:05 PM

I plan on leaving my current employment possibly next year. What's wrong with reallocating to a MMF now? Waiting on the sidelines and taking my losses now. Than jump back in when the market looks brighter.

**maat55** · 03-25-2008, 06:23 PM

I have the bulk of my IRA in the American Funds Capital World Growth & Income fund also. I think over the long haul it will be a very good fund. I have stopped my assett builder on that fund to move to no load funds elsewhere, but I am keeping what I have in it there.

**dardhel** · 03-26-2008, 02:57 AM

disneysteve is right. When you try and time the market you are most likely going to end up buying high and selling low.

Though I don't believe we have seen the end of our economic issues here in the US, I definitely would not feel comfortable betting on the severity and moving my money to cash. Unless you plan on needing the money in the next 5 years I wouldn't take it out of the market...

**disneysteve** · 03-26-2008, 04:44 AM

Originally posted by m3racer View Post

I plan on leaving my current employment possibly next year. What's wrong with reallocating to a MMF now? Waiting on the sidelines and taking my losses now. Than jump back in when the market looks brighter.

Here's what is wrong with that plan?

You bought these shares when times were better, so you paid a higher price for them than they are currently worth. Now their value has fallen. What you want to do is sell them now at a loss. Park your money in a MMF. Then wait until the funds have gone back up in price and buy them again (I realize you'd likely be buying different funds but the theory is the same).

The best time to buy isn't whent he market looks "brighter", it is when the market looks bleak.

**Broken Arrow** · 03-26-2008, 05:20 AM

Originally posted by disneysteve View Post

Here's what is wrong with that plan?

You bought these shares when times were better, so you paid a higher price for them than they are currently worth. Now their value has fallen. What you want to do is sell them now at a loss. Park your money in a MMF. Then wait until the funds have gone back up in price and buy them again (I realize you'd likely be buying different funds but the theory is the same).

The best time to buy isn't whent he market looks "brighter", it is when the market looks bleak.

Well said, Steve.

Please don't make the terrible mistake of buying high and selling low. It's a great way to lose your money.

**Scanner** · 03-26-2008, 06:35 AM

We have disagreements here but this time I am with everyone else.

If you feel like you want to have more options, go ahead and do the rollover (if you can) but make it a same type of fund transfer (Blue Chip Growth, International, etc) as you do the transfer.

It's fine to tweak your portfolio - we all do here. But don't cash the whole kit n' kaboodle out.

If anything, I would up your international exposure to 30%. That fund is way down and now is a good time to roll some dough into it.

**JBinKC** · 03-26-2008, 06:38 AM

What's new? I went through the same thing at work with subperforming funds but it was over a 13 year span (1993-2006). Without a match I averaged 1.3% per annum in appreciation from them which a monkey and a dart board probably could beat and to top it off I had 60% of it in an emerging markets fund. That is why you also need to also do a Roth IRA at least with that investment you can be in control.

**Scanner** · 03-26-2008, 06:51 AM

You see, that's one of the nice things about being self-employed (and there isn't too many in this country). You get control of your retirement assets.

I agree some reform is needed.

401(k)'s and 403(b)'s seem to be "salemen/financial planner" dependent, meaning often people have to choose from no-name high expense mutual funds.

To me, the 403(b) or 401(k) should just be held at a discount brokerage like Charles Schwab where you have 1000's of mutual funds, ETF's, stocks, and bonds to choose from and you just pick what you want.

And the U.S. gov't and savingadvice.com wonder why nobody in America has retirement savings. . .well at 1% return, it's no wonder.

**ThriftoRama** · 03-26-2008, 09:05 AM

Why shouldn't you move into an MMF? Because you don't lose money until you sell your stock. And chances are, you bought stock when the market was doing well. So if you sell now you are only guaranteeing that you lose money. if you wait, you get the advantage of the market upswing and you may make money on those stocks.

Basically, when the market is down, you should be buying more shares. It's like stocks are on sale.

**jIM_Ohio** · 03-26-2008, 01:03 PM

I would read up on investing, asset allocation, and risks before making any decisions.

Do not make short term decisions for long term problems without knowing most of the issues.

**jc3900** · 03-26-2008, 09:58 PM

m3racer: How old are you? You can't really critique a portfolio without knowing the age of the holder.

**sweeps** · 03-27-2008, 03:16 AM

Originally posted by jc3900 View Post

m3racer: How old are you? You can't really critique a portfolio without knowing the age of the holder.

Good point. (Presumably young if he is an M3 Racer.) But it goes beyond age anyway. Some 60 year old's want to be very aggressive investors. Some 30 year old's are too risk averse to invest in anything but a MMF.

critique my portfolio