|
BEHOLD: MY CAPE posted:Buying a sector ETF is the opposite of diversifying. Unless you are a professional financial analyst with experience in healthcare economics I would probably discard your personal read of the healthcare sector. Where you put money to hold it for a year or two depends a lot upon how risk adverse you are with the principal, I'd just put it in cash if you absolutely must have $X in two years or in a broad index ETF just the same as your long term savings if you wouldn't mind being forced into a realized loss if the market happens to be down when you need the money. I'm not risk-averse - on the scale of 1 to 5, 1 being risk-averse to the point of only being in bonds and 5 being ready to lose 75% of the principal if it means getting an eventual 50% return, I'm between a 2 and a 3. I don't have concrete plans for the money - it only comes to around $3k - I just don't want to lose more than the $284 it's already decreased in value.
|
#
?
Nov 6, 2015 19:00
|
|
|
|
| # ? May 18, 2024 16:22 |
|
|
MJP posted:I'm not risk-averse - on the scale of 1 to 5, 1 being risk-averse to the point of only being in bonds and 5 being ready to lose 75% of the principal if it means getting an eventual 50% return, I'm between a 2 and a 3. MJP posted:I just don't want to lose more than the $284 it's already decreased in value.
|
|
#
?
Nov 6, 2015 19:01
|
|
|
MJP posted:I'm not risk-averse - on the scale of 1 to 5, 1 being risk-averse to the point of only being in bonds and 5 being ready to lose 75% of the principal if it means getting an eventual 50% return, I'm between a 2 and a 3. You're pretty risk adverse if your stated goal is to avoid losing more money in a short time frame.
|
|
#
?
Nov 6, 2015 19:12
|
|
|
MJP posted:I'm not risk-averse quote:I just don't want to lose more than the $284 it's already decreased in value. hmmm e: by leaving it in this sector-specific fund you are falling prey to sunk cost fallacy. just put it in a broad sector fund, ~$300 is peanuts in the time scales we cover in this thread (my portfolio dipped like $15k from july-sep, for example, and this is normal fluctuation). Mr. Glass fucked around with this message at 20:08 on Nov 6, 2015 |
|
#
?
Nov 6, 2015 20:06
|
|
|
MJP posted:it only comes to around $3k - I just don't want to lose more than the $284 it's already decreased in value. MJP posted:a good option to hold for a year or two?
|
|
#
?
Nov 6, 2015 20:12
|
|
|
Star War Sex Parrot posted:Um, just put it in a savings account if that's really your timeframe for this money. Yup. If you need the money in less than 5 years, just put it in an Ally or whatever Savings account.
|
|
#
?
Nov 6, 2015 20:14
|
|
|
oh haha I completely missed the time frame. yeah go with a savings account, or a CD if you can find one with a better rate
|
|
#
?
Nov 6, 2015 20:21
|
|
|
The only thing is that I don't have a concrete goal for the money. I have a pretty broadly spread portfolio - mostly from advice I've seen here in this thread - for just a regular old non-IRA brokerage account, intended to appreciate interest at a better rate than any savings account can do right now. We're a single-income household, and fortunately my income is enough that I can max my IRA, use any bonus I get to max my wife's IRA, do 6% pre-tax for 401k, and still keep a paid-down balance sheet. It seems like there's really no decent mid-term option... am I really basically screwed to savings account (this thread) vs. gambling that I'm not willing to do (the stock picking thread)? Or should I just dump it into VFORX or VTSAX and let that be that? I get sunk-cost fallacy and that my personal choices haven't been meteoric. Hell, everything other than the iShares funds are decisions I've made, after getting rid of my adviser after Four Pillars and some less-than-optimal decisions he made. It was my decision in the end, after all - not blaming the guy - but those iShares funds have also been in my portfolio since 2006. Here's my portfolio as it stands now, for what it's worth - again this is the non-IRA brokerage, this is all post-tax money that, for all intents and purposes, would become retirement money unless we have major expenses. We do have a savings account populated to allow for 5-6ish months of zero income, as well as enough to do a bathroom renovation next year.  Edit: the PRU was a gift from my FIL, he works for the company and had shares to gift. Edit 2: poo poo, I just realized that any of the purchases I've made (excluding the PRU and iShares) totals to a very real net loss. How am I supposed to have a retirement if everything save for VFORX is a bad idea? Is there no such thing as a stock that gives decent returns over 5 years with minimal principal risk in the chance I might need the money? MJP fucked around with this message at 21:43 on Nov 6, 2015 |
|
#
?
Nov 6, 2015 21:37
|
|
|
Individual stocks are not for long term investing unless you have some particular and well-informed reason to believe they will do well over your required timeframe. Risk is directly correlated with return, there is no "safe growth stock" that hasn't already been milked by people who are paid stupid amounts of money to identify and make easy money. The only mid-term that may provide a decent yield (I assume you want more than 1-2%) while hedging your risk is the same as the long-term, except in a taxable account. If you're willing to take a risk, use index funds and pray the market is doing well at the point you wanna cash out. If you're not, use a CD or a normal bank account. Don't buy stocks, since it seems like you don't know what you're doing.
|
|
#
?
Nov 6, 2015 21:55
|
|
|
You seem to be all over the place with no clear plan. You've got a mix index funds from different places that are doubling up on the same segments (not going to do the math but I'm guessing you're significantly overweight in some segments because of this) and a significant amount of stock from random companies. Generally this thread advises buying into the entire market, best accomplished by buying a single total market index fund. By buying individual sector funds you're actually reducing your diversity and spread by concentrating it. Personally I would sell off all the stock in individual companies now, unless they're really close to becoming long term capital gains. Since it's a taxable account I'm not sure that I'd sell off the redundant index funds/ETFs, but going forward I would only buy three or four funds (from a standard three fund portfolio that covers the entire market) and just leave the others alone. For mid term stuff if you know the time frame get some CDs. If you don't know the time exactly, well, that's what savings accounts are good for - better than a checking account while maintaining the flexibility. Money market accounts are also fine for that kind of short-but-unknown term savings. I assume your emergency fund is already taken care of, if not you should probably open a savings account and get it to 3-6 months of living expenses. Interest rates don't really matter for this, since it's not going to be a significant portion of your net worth, so I'd keep it with a bank you can physically access if you already have accounts with one. e: MJP posted:Edit 2: poo poo, I just realized that any of the purchases I've made (excluding the PRU and iShares) totals to a very real net loss. How am I supposed to have a retirement if everything save for VFORX is a bad idea? Is there no such thing as a stock that gives decent returns over 5 years with minimal principal risk in the chance I might need the money? Individual stocks are hugely volatile and the reason they can give good returns is because the returns compensate for the risk. Broad index funds are going to be less volatile than the market but they'll always lag the best performing stocks. Since you cannot know which stocks are going to do well over a given period (barring very short term, very illegal, insider trading), an index fund will generally outperform stock picking despite having much lower risk. The fact that you have a net loss in many things is essentially meaningless except in the short term. When you're a long term investor you actually want the prices to go down in the short term, since you're still expecting the market to trend up in the long term. Short term dips, in the context of a long-term upward trend, mean you get more for your money. Desuwa fucked around with this message at 22:15 on Nov 6, 2015 |
|
#
?
Nov 6, 2015 22:03
|
|
|
MJP posted:Is there no such thing as a stock that gives decent returns over 5 years with minimal principal risk in the chance I might need the money? You seem to have no coherent strategy. Honestly, just pick a composite fund like Vanguard Target Retirement or Vanguard Lifestrategy Growth, dump your money there each paycheck, and forget the money exists until you actually need it for something.
|
|
#
?
Nov 6, 2015 22:08
|
|
|
MJP posted:Edit 2: poo poo, I just realized that any of the purchases I've made (excluding the PRU and iShares) totals to a very real net loss. How am I supposed to have a retirement if everything save for VFORX is a bad idea? Is there no such thing as a stock that gives decent returns over 5 years with minimal principal risk in the chance I might need the money? Buy more VFORX. What's wrong with this strategy, in your mind? If you want to further lower your risk, you can buy bond indexes, for example. If you're looking for safety over returns over something like 5 years, the bond market is where you should be.
|
|
#
?
Nov 6, 2015 22:09
|
|
|
Not to mention having 20+ different stocks makes rebalancing to match your overall strategy pretty challenging.
|
|
#
?
Nov 6, 2015 22:45
|
|
|
holy poo poo. if i were you i would immediately sell everything except VFORX and put it all in VFORX. VFORX has a broad portfolio that will cover all of your bases, as well as shifting into less risky investments as you approach the target year. until you have a solid overall investment strategy, this shotgun approach is going to (and probably already has) hurt you more than it has helped you. vanguard target funds are great fire-and-forget options that will serve you well even if you decide not to get fancier with your portfolio.
|
|
#
?
Nov 6, 2015 22:59
|
|
|
Not to mention the whole Apple and Netflix stock implies that he's getting excited over growth stock hyping articles. This thread recommends against buying individual stocks for many good reasons, not to mention a broad market ETF like VTI already allows you to invest in strong companies like Apple.
|
|
#
?
Nov 7, 2015 00:50
|
|
|
Like I said the last time around, when you said you got a giant wad of PRU and wanted to know what to do with it:Dessert Rose posted:That sounds like it makes up a pretty large chunk of your portfolio. I'd probably sell it and stick the proceeds wherever it makes sense based on your asset allocation. Now that you've posted your portfolio I see that I was right, despite your followup assertion that this was not a large chunk of your portfolio; 10% in a single stock is insane, and you have several other single stocks that add up to another 10% or so. As for where to put it... MJP posted:How am I supposed to have a retirement if everything save for VFORX is a bad idea? By putting it in VFORX? There's a reason that one of the most-recommended strategies is called the "three fund portfolio" and it isn't because it has 15 different funds. Also I'm  ing at your complaint that there isn't some sort of magical risk-free investment vehicle with huge consistent returns over the short and long term.
|
|
#
?
Nov 7, 2015 02:05
|
|
|
Dessert Rose posted:Now that you've posted your portfolio I see that I was right, despite your followup assertion that this was not a large chunk of your portfolio; 10% in a single stock is insane, and you have several other single stocks that add up to another 10% or so. The answer is always surprisingly small. Like even if you know a company can grow about 5x what the market expects it to (an absolutely ridiculous assumption), the math says you should only shift your holding in that company from something like 0.4% to 0.8% in an efficient portfolio.
|
|
#
?
Nov 7, 2015 07:02
|
|
|
On mobile but after sleeping on this (and you are correct to lol @ me wanting high returns at no risk) you guys are all basically correct. Should I wait a bit to get PRU higher up to sell? It seems like it would be good to hold it because it's PRU and it was free, but it's also going to keep me saner having it in VFORX. Should I also sell the ishares funds? Those have been in my portfolio for almost 10 years now, wouldn't it be better to keep them and hold for a while? All the other funds, yeah, those are getting sold. My strategy for them was something like "I have some extra $$, let's put it in one particular industry or Morningstar quadrant until I get a better idea" and then all the big drops happened. Into VFORX it is, unless I should put some in VTSAX as well.
|
|
#
?
Nov 7, 2015 14:19
|
|
|
MJP posted:On mobile but after sleeping on this (and you are correct to lol @ me wanting high returns at no risk) you guys are all basically correct. Should I wait a bit to get PRU higher up to sell? It seems like it would be good to hold it because it's PRU and it was free, but it's also going to keep me saner having it in VFORX. If someone handed you a check for $10k and told you to invest it how much would you allocate to buying PRU at today's prices? This isn't to say you should be active trading all the time or sell whenever a price drops. Just that "it was free" or "I'm waiting for it to go up another dollar" is the wrong way to think about these choices on highly liquid assets like this. Invest in what you want to invest in for your strategy and goals, not the past.* *The exception being for taxable accounts and LTCG and loss harvesting.
|
|
#
?
Nov 7, 2015 14:37
|
|
|
Optimally you could just sell everything and make a lazy index portfolio but you'd take a bunch of transaction fees and a capital gains tax hit doing that. Alternately you could just dump 100% of your investments going forward into a lazy index strategy and rebalance like that. The best thing might be to just mix and match your individual stock losers offset with winners for a near zero capital gains and take what you can liquidate in that manner to reinvest in a balanced lazy portfolio. Many of your holdings are fine like your ishares index ETFs and you can augment those holdings to make an allocated portfolio. Exactly what you need and where to put it depends on how big your IRAs and 401ks are, but a general strategy of "allocated bonds, REITs, and international stocks have priority in retirement accounts" is basically correct for tax efficiency.
|
|
#
?
Nov 7, 2015 14:39
|
|
|
The other weakness of the portfolio is it's heavily biased towards US stocks. US stocks should be a core position for a US investor but you are missing out by not including some foreign stock exposure.
|
|
#
?
Nov 7, 2015 19:37
|
|
|
You know what, at this point I'm just gonna go with "there is no more portfolio," sell everything, put it half into VFORX and half into VTSMX. Unless it's stupid for capital gains, that is, but I guess I have enough losses to offset them? Maybe I should do a one-time consultation with an accountant/financial planner to make a graceful exit from active investing and just keep up in VFORX/VTSMX. I recognize the need to have a retirement/rainy day investment fund that isn't all bonds, but I don't have the time and dedication required to make big calls on how to diversify and manage a portfolio. MJP fucked around with this message at 22:50 on Nov 7, 2015 |
|
#
?
Nov 7, 2015 22:43
|
|
|
etalian posted:Not to mention the whole Apple and Netflix stock implies that he's getting excited over growth stock hyping articles. Hard to call AAPL a growth stock with a 12 PE ratio.
|
|
#
?
Nov 7, 2015 22:51
|
|
|
app posted:Hard to call AAPL a growth stock with a 12 PE ratio. AAPL, NFLX, and CRM were just gambles I took based on selling AMBA when it was still doing really well. That was the last advisor-recommended stock I bought.
|
|
#
?
Nov 7, 2015 22:53
|
|
|
app posted:Hard to call AAPL a growth stock with a 12 PE ratio. Well it's a well known cult tech company so it has massive amounts of idle speculation investor articles. If you like tech stocks you are still investing in them by buying something like VTI or even a simple SP500 index tracker.
|
|
#
?
Nov 7, 2015 22:53
|
|
|
MJP posted:You know what, at this point I'm just gonna go with "there is no more portfolio," sell everything, put it half into VFORX and half into VTSMX. Unless it's stupid for capital gains, that is, but I guess I have enough losses to offset them? VFORX has everything in it, including what VTSMX has in it. By investing half of your money into VTSMX you're going to have a huge amount of exposure to the US stock, far out of proportion to what they make up of the world's economy. If anything I think the vanguard retirement funds could stand to have more international stocks, so going the other way doesn't seem sound to me. Throwing it all into VFORX is not a bad idea, don't feel you need to make it complicated. The vanguard retirement funds do roughly what a good passive investor with a three or four fund portfolio would do.
|
|
#
?
Nov 8, 2015 01:01
|
|
|
Desuwa posted:VFORX has everything in it, including what VTSMX has in it. By investing half of your money into VTSMX you're going to have a huge amount of exposure to the US stock, far out of proportion to what they make up of the world's economy. If anything I think the vanguard retirement funds could stand to have more international stocks, so going the other way doesn't seem sound to me. Vanguard did change their Retirement fund allocation strategy this year to have slightly more non-US stock exposure.
|
|
#
?
Nov 8, 2015 01:32
|
|
|
OK, I'm gonna do it. Everything gets sold. Including the ishares funds. And PRU. I wanna hang on to AAPL and NFLX in hopes of bumps for the holidays. CRM has been doing well but everything is everything. I'll probably find something with bonds to park around 10k for a 1-5 year plan, in case a car dies or the roof gets tree'd, unless VFORX is a good place to sell a bit from should the need arise.
|
|
#
?
Nov 8, 2015 14:33
|
|
|
I have a pretty good problem to have - I think I'm going to wind up above the phase-outs for deductible Traditional IRA contributions, but perhaps not above the phase-outs for Roth. I'm an expat, so I pay no taxes here and get the foreign income and housing exclusions which knocks out a sizeable chunk of my income. I forgot about MAGI though - you add back in your housing costs and income previously excluded. This puts me and my non working spouse somewhere in the range between the phase out for IRA deductions but below the phase out for Roth IRA eligibility. Assuming I've maxed out a traditional IRA - my next best strategy is to max out a Roth IRA right? My wife is also ineligible to deduct a traditional IRA contribution because our joint income will be too high, so I should contribute to a Roth for her as well. I think I can re-characterize our traditional IRA contributions that I made before I figured this out, so I won't have that problem. But I had previously rolled an employer traditional 401k into a traditional IRA. Next year I'll be above the Roth phaseout too...in order to remain eligible for the backdoor roth contributions, I'd need to roll that traditional IRA into my traditional 401k - right? My plan allows that, I believe. After that, my retirement savings will be: Roth IRAs for my wife and I Traditional 401k containing my previous Traditional IRA rolled into it and going forward I'll do the backdoor Roth trick without having any other traditional IRAs around to mess things up. I know this is a good problem to have, but going from non-profits for 7 years to this I was totally gobsmacked to realize I had forgotten all about phase outs.
|
|
#
?
Nov 8, 2015 16:41
|
|
|
MJP posted:OK, I'm gonna do it. Everything gets sold. Including the ishares funds. And PRU. I wanna hang on to AAPL and NFLX in hopes of bumps for the holidays. CRM has been doing well but everything is everything. the 10k is an emergency fund, so you should put it in a savings account. ally and discover typically have the best rates right now.
|
|
#
?
Nov 8, 2015 18:37
|
|
|
BEHOLD: MY CAPE posted:HSA is great if available to you but really most people don't have access to HSA eligible plans. If you do and you're a young person I'd be all over that. Would you take an HSA even if you had access to a really good PPO? My company is offering an HDHP-HSA with some $5k deductible, or a PPO with $0 deductible and $250 max out of pocket. I'd like to save up money for the future in an HSA, but...
|
|
#
?
Nov 8, 2015 22:12
|
|
|
ohgodwhat posted:Would you take an HSA even if you had access to a really good PPO? My company is offering an HDHP-HSA with some $5k deductible, or a PPO with $0 deductible and $250 max out of pocket. I'd like to save up money for the future in an HSA, but... Depends on how much each costs.
|
|
#
?
Nov 8, 2015 22:54
|
|
|
It's $15/mo for the PPO, for me at least. Can't imagine what my employer is paying.
|
|
#
?
Nov 8, 2015 23:05
|
|
|
ohgodwhat posted:It's $15/mo for the PPO, for me at least. Can't imagine what my employer is paying. Well, on one hand, you don't have access to an HSA with the PPO so that's definitely a minus. On the other hand, 15/mo for 0 deductible and 250 OOP max? That's god damned insane.
|
|
#
?
Nov 8, 2015 23:30
|
|
|
Yeah, don't worry about an HSA if you have a deal like that.
|
|
#
?
Nov 8, 2015 23:34
|
|
|
I'd rather have a 401k match :-(
|
|
#
?
Nov 8, 2015 23:50
|
|
|
Mr. Glass posted:the 10k is an emergency fund, so you should put it in a savings account. ally and discover typically have the best rates right now. Oh, I already have an emergency fund. Enough to exist for six months of zero income from anything at all and an extra $25k for an upcoming bathroom remodel (although we're gonna be way way under that). The portfolio sales will all go back into VFORX. The $10k I mentioned would be for "gently caress, it's 2018 and the car finally died" (it probably won't) or "gently caress, it's 2019 and Sandy II: Superstorm Boogaloo hurled an oak tree across our roof" given that our IRAs are already maxed for the year. Totally open to a 5-year suggestion.
|
|
#
?
Nov 9, 2015 00:05
|
|
|
Some people go for the HDHP for a year, max out the HSA, then switch to a different plan. It's all about gaming the terrible system in the way that makes the most sense for you
|
|
#
?
Nov 9, 2015 01:33
|
|
|
ohgodwhat posted:Would you take an HSA even if you had access to a really good PPO? My company is offering an HDHP-HSA with some $5k deductible, or a PPO with $0 deductible and $250 max out of pocket. I'd like to save up money for the future in an HSA, but... So your company is paying you to take the HSA? If not, you've either misunderstood the plan offerings (e.g. $250 max OOP *per incident*) or something is very fishy indeed. It's one of those too good to be true kind of things, you know? It's not that you can't have a heavily company subsidized PPO as you describe, but to see it for $15/mo when paired with a $5k deductible HSA as a companion offering is just weird to say the least.
|
|
#
?
Nov 9, 2015 07:51
|
|
|
|
| # ? May 18, 2024 16:22 |
|
|
If I sell a stock that's subject to long-term capital gains tax, will I get some kind of a form for tax season or will I need to keep records of it for myself? If the latter, would it suffice to know the quantity of shares, purchase price, sell price, purchase date, and sell date? What about for short-term capital losses, or do those not even matter?
|
|
#
?
Nov 9, 2015 14:23
|
|