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Who's investment advise schould I use in my 401k?



 
 
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  #1  
Old February 19th 05, 02:14 AM
Joseph A. Zupko
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Default Who's investment advise schould I use in my 401k?

MSN Picks it this way:
Security % of plan assets
Domestic big-cap stocks (like S&P 500 stocks) 30%
Domestic small-cap stocks 20%
International stocks 20%
Domestic high-quality bonds 25%
Stable value or short-term bond 5%



Here is Citistreet suggest:
Investment advice: Tax-deferred accounts


Current strategy New strategy


Sears 401(k) Savings Plan

Current Suggested


Interest Income Fund 9% 0%


Domestic Bond Fund 6% 0%


Diversified Indx Conserv. 0% 0%


Diversified Index Moderate 26% 0%


Diversified Index Aggressive 0% 3%


Large Cap Value Equity Fd 0% 0%


International Equity Fund 3% 0%


S & P 500 Equity Index Fund 12% 78%


Large Cap Growth Eqty Fd 0% 19%


Small Cap Equity Fund 0% 0%


Sears Stock Fund 44% 0%


  #2  
Old February 19th 05, 05:00 AM
LuckyDucky
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Posts: n/a
Default



MSN Picks it this way:
Security % of plan assets
Domestic big-cap stocks (like S&P 500 stocks) 30%
Domestic small-cap stocks 20%
International stocks 20%
Domestic high-quality bonds 25%
Stable value or short-term bond 5%




Allocation Models via Risk Level :


--------------------------
AGGRESSIVE :

Stocks : 95 %
-----Large Co 40%
-----Small Co 25%
-----Internatiional stocks 30%
Bonds : 0%
Cash : 5%


Model Performance on data : 1970 -1996
avg annual return : 12.89%
best year : 42.39%
worst year : -23.82%

--------------------------
MODERATELY AGGRESSIVE

Stocks : 75 %
-----Large Co 35%
-----Small Co 20%
-----Internatiional stocks 20%
Bonds : 20%
Cash : 5%


Model Performance on data : 1970 -1996
avg annual return : 12.22%
best year : 35.16%
worst year : - 17.75%


--------------------------
MODERATE

Stocks : 60 %
-----Large Co 30%
-----Small Co 15%
-----Internatiional stocks 15%
Bonds : 30%
Cash : 10%

Model Performance on data : 1970 -1996
avg annual return : 11.55%
best year : 29.76%
worst year : -12.95%


---------------------------
MODERATELY CONSERVATIVE

Stocks : 40 %
-----Large Co 20%
-----Small Co 10%
-----Internatiional stocks 10%
Bonds : 45%
Cash : 15%

Model Performance on data : 1970 -1996
avg annual return : 10.65%
best year : 25.57%
worst year : - 6.54%


----------------------------
CONSERVATIVE

Stocks : 20 %
-----Large Co 15%
-----Small Co 0%
-----Internatiional stocks 5%
Bonds : 55%
Cash : 25%

Model Performance on data : 1970 -1996
avg annual return : 9.44%
best year : 21.81%
worst year : - 1.25%

  #3  
Old February 19th 05, 02:45 PM
Frithiof Andreas Jensen
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Default


"Joseph A. Zupko" skrev i en meddelelse
...

The advise that will cause you the minimum future regret. You should know
what that is too: Would Perhaps Loosing capital on Stocks be worse than
loosing potential gains by buying bonds??

I don't know - so I have 50/50 ratio of Bonds and Stocks, subdivided across
"Junk" to "AAA";

Funny Enough: The bonds have beaten the stocks the last three years!!


  #4  
Old February 19th 05, 04:07 PM
The Michael
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Default

On Sat 19 Feb 2005 08:45:47a, Frithiof Andreas Jensen wrote in
k:


"Joseph A. Zupko" skrev i en meddelelse
...

The advise that will cause you the minimum future regret. You should
know what that is too: Would Perhaps Loosing capital on Stocks be
worse than loosing potential gains by buying bonds??

I don't know - so I have 50/50 ratio of Bonds and Stocks, subdivided
across "Junk" to "AAA";

Funny Enough: The bonds have beaten the stocks the last three years!!


I really spend no time tracking how my bonds are doing as I buy either buy
the maturies I plan on keeping or via funds. The individuals I just carry
at 100 since that's what I plan on getting at maturity. Currently, as far
as individual FI securites go, I actually am more weighted into CDs.

My last "happy" bond recently matured; 7.75% Lehman Brothers non-callable.
I miss it ;(

--

Mike
  #5  
Old February 19th 05, 04:25 PM
Jerry L Wilcox
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Posts: n/a
Default

Take a look at the historical performance of each of your available choices.
Without knowing this, I have no particular suggestions, just a couple of
comments. If your timeframe is long, I would avoid bonds. IMO small cap
will under perform this year. Normally I would put at least 10% in foreign,
but if the one that you have available has a poor history - avoid it. No
more than 10% in company stock.

--
Jerry



"Joseph A. Zupko" wrote in message
...
MSN Picks it this way:
Security % of plan assets
Domestic big-cap stocks (like S&P 500 stocks) 30%
Domestic small-cap stocks 20%
International stocks 20%
Domestic high-quality bonds 25%
Stable value or short-term bond 5%



Here is Citistreet suggest:
Investment advice: Tax-deferred accounts


Current strategy New strategy


Sears 401(k) Savings Plan

Current Suggested


Interest Income Fund 9% 0%


Domestic Bond Fund 6% 0%


Diversified Indx Conserv. 0% 0%


Diversified Index Moderate 26% 0%


Diversified Index Aggressive 0% 3%


Large Cap Value Equity Fd 0% 0%


International Equity Fund 3% 0%


S & P 500 Equity Index Fund 12% 78%


Large Cap Growth Eqty Fd 0% 19%


Small Cap Equity Fund 0% 0%


Sears Stock Fund 44% 0%




  #6  
Old February 19th 05, 05:42 PM
Weekly Trades
external usenet poster
 
Posts: n/a
Default

hey

what is the source of this information?
the historical performance of 401K based on the % allocations - this is
good info to have and when i was about to start allocating my 401K, i
was never able to get such data.

let me know.

thanks.

LuckyDucky wrote:
MSN Picks it this way:
Security % of plan assets
Domestic big-cap stocks (like S&P 500 stocks) 30%
Domestic small-cap stocks 20%
International stocks 20%
Domestic high-quality bonds 25%
Stable value or short-term bond 5%




Allocation Models via Risk Level :


--------------------------
AGGRESSIVE :

Stocks : 95 %
-----Large Co 40%
-----Small Co 25%
-----Internatiional stocks 30%
Bonds : 0%
Cash : 5%


Model Performance on data : 1970 -1996
avg annual return : 12.89%
best year : 42.39%
worst year : -23.82%

--------------------------
MODERATELY AGGRESSIVE

Stocks : 75 %
-----Large Co 35%
-----Small Co 20%
-----Internatiional stocks 20%
Bonds : 20%
Cash : 5%


Model Performance on data : 1970 -1996
avg annual return : 12.22%
best year : 35.16%
worst year : - 17.75%


--------------------------
MODERATE

Stocks : 60 %
-----Large Co 30%
-----Small Co 15%
-----Internatiional stocks 15%
Bonds : 30%
Cash : 10%

Model Performance on data : 1970 -1996
avg annual return : 11.55%
best year : 29.76%
worst year : -12.95%


---------------------------
MODERATELY CONSERVATIVE

Stocks : 40 %
-----Large Co 20%
-----Small Co 10%
-----Internatiional stocks 10%
Bonds : 45%
Cash : 15%

Model Performance on data : 1970 -1996
avg annual return : 10.65%
best year : 25.57%
worst year : - 6.54%


----------------------------
CONSERVATIVE

Stocks : 20 %
-----Large Co 15%
-----Small Co 0%
-----Internatiional stocks 5%
Bonds : 55%
Cash : 25%

Model Performance on data : 1970 -1996
avg annual return : 9.44%
best year : 21.81%
worst year : - 1.25%


  #7  
Old February 19th 05, 09:17 PM
LuckyDucky
external usenet poster
 
Posts: n/a
Default



hey

what is the source of this information?
the historical performance of 401K based on the % allocations - this is
good info to have and when i was about to start allocating my 401K, i
was never able to get such data.

let me know.

thanks.




Thats from a Charles Schwab Flyer handout i must have recieved about 1997 or
98 ( hence the study data only up to 1996 ) as advisory for their clients.

You are correct--it is amazing that fundcos don't usually offer study data
like that. They all should--and for many other time segments too.
BTW everyone should be a bit wary of the dataset they used here for their
study ( 70-96) as being too bullish and optimistic ( aka--expect less on
average) , as that dataset lays out a trough bearish period at the very
beggining of the study / investment, followed by a massive bullish rally into
it's last 15 or so years. Not the common trajectory most investors may find
in their own investment lifespans.





LuckyDucky wrote:
MSN Picks it this way:
Security % of plan assets
Domestic big-cap stocks (like S&P 500 stocks) 30%
Domestic small-cap stocks 20%
International stocks 20%
Domestic high-quality bonds 25%
Stable value or short-term bond 5%




Allocation Models via Risk Level :


--------------------------
AGGRESSIVE :

Stocks : 95 %
-----Large Co 40%
-----Small Co 25%
-----Internatiional stocks 30%
Bonds : 0%
Cash : 5%


Model Performance on data : 1970 -1996
avg annual return : 12.89%
best year : 42.39%
worst year : -23.82%

--------------------------
MODERATELY AGGRESSIVE

Stocks : 75 %
-----Large Co 35%
-----Small Co 20%
-----Internatiional stocks 20%
Bonds : 20%
Cash : 5%


Model Performance on data : 1970 -1996
avg annual return : 12.22%
best year : 35.16%
worst year : - 17.75%


--------------------------
MODERATE

Stocks : 60 %
-----Large Co 30%
-----Small Co 15%
-----Internatiional stocks 15%
Bonds : 30%
Cash : 10%

Model Performance on data : 1970 -1996
avg annual return : 11.55%
best year : 29.76%
worst year : -12.95%


---------------------------
MODERATELY CONSERVATIVE

Stocks : 40 %
-----Large Co 20%
-----Small Co 10%
-----Internatiional stocks 10%
Bonds : 45%
Cash : 15%

Model Performance on data : 1970 -1996
avg annual return : 10.65%
best year : 25.57%
worst year : - 6.54%


----------------------------
CONSERVATIVE

Stocks : 20 %
-----Large Co 15%
-----Small Co 0%
-----Internatiional stocks 5%
Bonds : 55%
Cash : 25%

Model Performance on data : 1970 -1996
avg annual return : 9.44%
best year : 21.81%
worst year : - 1.25%




  #8  
Old February 19th 05, 09:47 PM
LuckyDucky
external usenet poster
 
Posts: n/a
Default



Take a look at the historical performance of each of your available
choices. Without knowing this, I have no particular suggestions, just a
couple of comments. If your timeframe is long, I would avoid bonds.
IMO small cap will under perform this year. Normally I would put at
least 10% in foreign, but if the one that you have available has a poor
history - avoid it. No more than 10% in company stock.



anybody ever heard of the old 'quick allocation' formula ?

It goes like this :

110 - your age = the % amount you should have in stocks ( the remainder in
bonds).

if you want to be slightly more agressive , use 120
slightly more conservative , use 100.


voila. ;-)




  #9  
Old February 19th 05, 10:07 PM
Spehro Pefhany
external usenet poster
 
Posts: n/a
Default

On Sat, 19 Feb 2005 21:47:16 GMT, the renowned LuckyDucky
wrote:



Take a look at the historical performance of each of your available
choices. Without knowing this, I have no particular suggestions, just a
couple of comments. If your timeframe is long, I would avoid bonds.
IMO small cap will under perform this year. Normally I would put at
least 10% in foreign, but if the one that you have available has a poor
history - avoid it. No more than 10% in company stock.



anybody ever heard of the old 'quick allocation' formula ?

It goes like this :

110 - your age = the % amount you should have in stocks ( the remainder in
bonds).

if you want to be slightly more agressive , use 120
slightly more conservative , use 100.


voila. ;-)


If you're past maybe 65 or 70 and still have lots of assets compared
to your burn rate, the risk should start to be increased again each
year- the bulk of the assets are really going to go to your heirs.

Best regards,
SP
  #10  
Old February 19th 05, 10:39 PM
LuckyDucky
external usenet poster
 
Posts: n/a
Default

anybody ever heard of the old 'quick allocation' formula ?

It goes like this :

110 - your age = the % amount you should have in stocks ( the remainder
in
bonds).

if you want to be slightly more agressive , use 120
slightly more conservative , use 100.


voila. ;-)


If you're past maybe 65 or 70 and still have lots of assets compared
to your burn rate, the risk should start to be increased again each
year- the bulk of the assets are really going to go to your heirs.

Best regards,
SP



How about a Personal Risk Level test ?


-------------------


QUIZ: What Is Your Risk Tolerance?
by Richard Band
Editor, Profitable Investing
June 21, 2002

What may be right for one investor may not be right for another. There are
some investors I know who aren't bothered at all by stocks whose prices can
swing like Benny Goodman, while other investors can't sleep at night unless
their portfolio is as rock-steady as a guard at Buckingham Palace. So I've
put together a handful of questions to help you accurately see how much risk
you should be taking.

Directions: For each question, select an answer, and then write down the
corresponding number in the parentheses. At the end of the quiz, add these
numbers up for your score.


Age
My age bracket is:
(14) under 35
(8) 35-49
(5) 50-57
(3) 58-65
(1) over 65

Income
My annual income from all sources is (in thousands):
(1) under $30
(3) $30-$49
(5) $50-$79
(7) $80-$150
(9) over $150

Annual Expenses
In relation to income, my annual expenses approximate:
(1) over 95%
(3) 90%-95%
(4) 80%-89%
(6) 60%-79%
(8) under 60%

Number of Dependents
I currently have these dependents (including non-working spouse):
(7) 0
(6) 1
(5) 2-3
(3) 4-5
(1) 6 or more

Estimated Value of Assets
Market value of my house; cash value of life insurance, savings, business
interests, and investments (in thousands):
(1) under $75
(3) $75-$199
(5) $200-$399
(7) $400-$899
(8) $900 or more

Liabilities
My mortgages, installment loans and long-term debts in relation to assets
approximate:
(8) under 30%
(6) 30%-49%
(4) 50%-69%
(2) 70%-90%
(1) over 90%

Savings
I have cash on hand or cash equivalents in savings to equal expenses for:
(1) under 2 months
(3) 2-4 months
(5) 5-6 months
(6) 6-12 months
(8) over 1 year

Life insurance
My life insurance coverage equals (in thousands):
(6) $400 or more
(4) $200-$399
(2) $100-$199
(1) $1-$100
(0) none

Health insurance
My health insurance coverage, counting Medicare but not Social Security
disability benefits, includes:
(0) no insurance
(2) catastrophic only
(4) major medical, up to $1,000 per year deductible
(6) HMO, Medicare




How to Interpret Your Score
under 25 Conservative Portfolio
25-47 Neutral Portfolio
over 47 Aggressive Portfolio


Below are my recommended allocations for each portfolio.

CONSERVATIVE PORTFOLIO
50% stocks
100% domestic
Blue chip stocks only
3%5% cash yield
50% bonds

NEUTRAL PORTFOLIO
65% stocks
90% domestic, 10% international
Small caps up to 25% of stock weighting
2%4% cash yield
35% bonds

AGGRESSIVE PORTFOLIO
80% stocks
85% domestic, 15% international
Small caps up to 40% of stock weighting
1%2% cash yield
20% bonds


My main model portfolio in Profitable Investing closely mimics the "Neutral"
portfolio, although I always make additional recommendations for investors
looking for other opportunities, such as extra income investments or options.
Even though investors have very different portfolios, they may all be
following the same sound investment strategy. Keep in mind: There's more than
one path to financial independence.
 




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