Who Else is in the 401K Blackhole?

[bigdaddybus]

Okay, but let's distinguish between investing and trading. They aren't the same thing. I've done some trading myself over the years so I'm not at all opposed to doing it but I would never confuse it with my long term investing plan.

Someone who is spooked by a drop in the market and reacts by selling off all of the stock in his 401k is entirely different than someone who is intentionally buying and selling stocks over a short time span.

Agreed,

When people are panicking, you can find me buying pre-evaluated stocks/funds.

[disneysteve]

Interesting you use the blackjack analogy. I dont gamble in casinos, but I hear alot of people consider active investing as gambling.

I have a different view on this. I do gamble in casinos. I don't think stock trading and blackjack are alike at all. When I sit down at a blackjack table, I know exactly what my odds are. In a 6-deck game, the house has a 0.403% edge. On a 9/6 jacks or better video poker machine, the house edge is 0.46%. At the roulette table (which I never do but just making a point), I know the house edge is 5.26%.

Do you know your exact odds of making money when you buy a stock? Of course not. The outcome could vary based on dozens of factors entirely beyond your control. A natural disaster in Japan, political upheaval in the Middle East, a company scandal on Wall Street, a previously unknown product defect, etc. could all dramatically change the stock price in ways that you couldn't possibly have predicted when you made your investment. So you are gambling but in a very different way than when you enter your local casino.

[feh]

Timely article regarding Jack Bogle:

http://www.marketwatch.com/story/jack-bogles-advice-to-worried-investors-shut-your-eyes-and-let-the-indexes-work-2014-11-03

If the stock market’s September-October flip-flop scared you, Jack Bogle has some advice on how to tackle what’s about to happen next: Close your eyes.

[sandrark]

So I checked (I rebalance annually in January, so had not yet compared), and yes, I'm currently in the "black hole." In my main account, I started the year with $275k, I've contributed $11k, and the current balance is $253k.

I have several other accounts (Roth, Traditional IRA, and another deferred comp account) totaling another ~$200k, and I assume the pattern is similar.

I'm not worried - I'll rebalance in January, and assess then - if nothing else, I'm DCA'ing into the accounts, and saving the taxes off the top.

[feh]

So I checked (I rebalance annually in January, so had not yet compared), and yes, I'm currently in the "black hole." In my main account, I started the year with $275k, I've contributed $11k, and the current balance is $253k.

Would you be willing to tell us what your investments are? Both equities and bonds are up for the year, so it's odd that your account is done for the year...

[sandrark]

Would you be willing to tell us what your investments are? Both equities and bonds are up for the year, so it's odd that your account is done for the year...

This is my main account; I do have another Roth ($17k), about $20k in a 457(b), and another defined benefit fund with $37k. I allocate across all accounts, but this is the biggest and thus of most interest.

All Fidelity Funds:

Spartan Total Mkt Index, Fidelity Advantage, Institutional (FSKAX - 64%)
Spartan Intl Index (FSPNX - 27%)
Fidelity Emerging Mkts (FKEMX - 7%)
Spartan Short Term Treasury Bond Index Funds, Advantage Class (FSBAX - 2%)

I invest low in bonds, since I have a significant pension, and my reading recommends likening your investment in a pension fund as similar to bonds in a portfolio.

[sandrark]

Feh, thanks for asking, actually - I dug a little more specifically, and in the account below, I am actually up 5.37% YTD.

This is my main account; I do have another Roth ($17k), about $20k in a 457(b), and another defined benefit fund with $37k. I allocate across all accounts, but this is the biggest and thus of most interest.

All Fidelity Funds:

Spartan Total Mkt Index, Fidelity Advantage, Institutional (FSKAX - 64%)
Spartan Intl Index (FSPNX - 27%)
Fidelity Emerging Mkts (FKEMX - 7%)
Spartan Short Term Treasury Bond Index Funds, Advantage Class (FSBAX - 2%)

I invest low in bonds, since I have a significant pension, and my reading recommends likening your investment in a pension fund as similar to bonds in a portfolio.

In digging to my other accounts:

- My 457(b) and DCP holdings are up 9.46% YTD - invested entirely in Spartan Total Mkt Index, Fidelity Advantage, Institutional (FSKAX).

That means it's the IRAs.

DH has two: a ROTH and a SEP:

- SEP IRA is 90% FSTVX - Spartan Total Mkt Index (up 39% since purchase) and 10% Fidelity Inflation Protected Bonds (up 14.41% since purchase). Fidelity won't let me look up YTD on these two - outside of the 90 day window.

- The Roth is in a sector fund - FBIOX - Fidelity Select Biotechnology. Up 27.7% since purchase.

I'll have to rec-check some numbers (my main file is at work, and I'm home this week). Those holdings don't explain a black hole this year.

[feh]

Feh, thanks for asking, actually - I dug a little more specifically, and in the account below, I am actually up 5.37% YTD.



In digging to my other accounts:

- My 457(b) and DCP holdings are up 9.46% YTD - invested entirely in Spartan Total Mkt Index, Fidelity Advantage, Institutional (FSKAX).

That means it's the IRAs.

DH has two: a ROTH and a SEP:

- SEP IRA is 90% FSTVX - Spartan Total Mkt Index (up 39% since purchase) and 10% Fidelity Inflation Protected Bonds (up 14.41% since purchase). Fidelity won't let me look up YTD on these two - outside of the 90 day window.

- The Roth is in a sector fund - FBIOX - Fidelity Select Biotechnology. Up 27.7% since purchase.

I'll have to rec-check some numbers (my main file is at work, and I'm home this week). Those holdings don't explain a black hole this year.

You don't need Fidelity's site to find the returns of these funds - as longs as you have the ticker, you can find them just about anywhere. Here's FBIOX:

http://quotes.morningstar.com/fund/fbiox/f?t=fbiox

I wouldn't think the TIPS fund should be negative for the year either. Can you check your numbers? This doesn't make sense...