New To Investing Thread

[wetwillie]

Holy crap you guys if this thing keeps going gangbusters I might get to retire before Snyder does!

[ben ji]

My goal for 2017 is to fully maximize all of my tax advantaged accounts (401K, HSA, IRA)

[cfbandyman]

I'll keep taking it going up, but it just feels like this is around the corner:

[sys]

that's fantastic, wetwillie.  congratulations.

[kim carnes]

Russell 2000 has been bananas the last 2 months.   Why tho

[EMAWican]

Russell 2000 has been bananas the last 2 months.   Why tho

Trump effect on a handful of sectors.

[catastrophe]

Investors behave pretty irrationally a lot of the time.

[The Big Train]

Bitcoin is down $33 today and falling fast, get out those pocket books guys

Exchange rate when I posted this was 1 Bitcoin = $408.

Right now it's 1 Bitcoin = $729.   

Hope you sold high. It's at 558 and dropping like a rock.

This is almost too easy. 

Up $130 the past week and $197 in the last month.  Currently selling at $928.

[Kat Kid]

Vanguard IRA question:

I have a target retirement fund.  I don't think I have admiral shares, but it says I am ineligible.  I think it is because of the bolded part below.

You have no holdings eligible for Admiral™ Shares conversion. For a holding to be eligible for Admiral Shares conversion, it cannot have any account restrictions and must meet at least one of the following conditions:

$10,000 or more in an index fund that offers Admiral Shares.
$50,000 or more in an actively managed fund that offers Admiral Shares.
$100,000 or more in certain sector funds or tax-managed funds that offer Admiral Shares.
Note: Certain retirement accounts that offer special administrative services, such as SIMPLE IRAs, 403(b)(7), individual 401(k), individual Roth 401(k), qualified profit-sharing, and money purchase pension plans, may be ineligible for Admiral Shares.

I don't think it is because of the balance in the account.  I would gain .10% on expense ratio, but it would be less diversified (but would be all stock, which it isn't right now after checking the fund). 

Should I convert to save the .10% expense ratio?  Is it worth converting anyway instead of being in a target retirement fund?

Thoughts?

[treysolid]

Vanguard IRA question:

I have a target retirement fund.  I don't think I have admiral shares, but it says I am ineligible.  I think it is because of the bolded part below.

You have no holdings eligible for Admiral™ Shares conversion. For a holding to be eligible for Admiral Shares conversion, it cannot have any account restrictions and must meet at least one of the following conditions:

$10,000 or more in an index fund that offers Admiral Shares.
$50,000 or more in an actively managed fund that offers Admiral Shares.
$100,000 or more in certain sector funds or tax-managed funds that offer Admiral Shares.
Note: Certain retirement accounts that offer special administrative services, such as SIMPLE IRAs, 403(b)(7), individual 401(k), individual Roth 401(k), qualified profit-sharing, and money purchase pension plans, may be ineligible for Admiral Shares.

I don't think it is because of the balance in the account.  I would gain .10% on expense ratio, but it would be less diversified (but would be all stock, which it isn't right now after checking the fund). 

Should I convert to save the .10% expense ratio?  Is it worth converting anyway instead of being in a target retirement fund?

Thoughts?

I guess it depends on your total investment in the fund. Do you have $5000 or $50,000 in it, because that's a big difference. With it being a Vanguard fund, I can't imagine the expense ratio is more than 0.3-0.4% anyways. If your portfolio is properly allocated, you probably have some investments elsewhere that are 0.5-1.0% that you should spend your time finding alternatives for.

[Kat Kid]

I have over $50,000 in it.

The difference is .16% in the Target Retirement Fund to .06% in the 500 index.  There are other options in between, but this was the move I was considering.

[sys]

what else is the target fund?  you have other funds, or this is supposed to handle all of your diversification for you?

[Kat Kid]

what else is the target fund?  you have other funds, or this is supposed to handle all of your diversification for you?

It is supposed to be diversified.  It has more bonds than I think I should, but I don't know.

I think this is all a marginal call, but the .10% seems worth doing it if I also get an all-stock fund.

My only downside is if the 500 index is diversified enough, it seems like it should be, but what do people think?

[sys]

i would get out of the target fund.  i don't understand why a young investor would own any bonds (at least any domestic sovereign bonds).  if you are talking about only owning an sp500 index fund, i wouldn't do that.  i think you should have some diversification (foreign equity, small/mid cap, real estate and/or infrastructure).

jmo, tho.

[sys]

oth, if your target fund holds stuff in other cap ranges and international, and you are talking about taking all of that and putting it into an sp500 fund, i would not do that.

[Kat Kid]

oth, if your target fund holds stuff in other cap ranges and international, and you are talking about taking all of that and putting it into an sp500 fund, i would not do that.

Yeah, that is essentially the question.  The bonds held in the retirement fund i think are pointless, but the fund is diversified.  I am essentially trading more stocks/less fees for less diversification.  I'm trying to figure out if it is worth it.

[catastrophe]

i would get out of the target fund.  i don't understand why a young investor would own any bonds (at least any domestic sovereign bonds).  if you are talking about only owning an sp500 index fund, i wouldn't do that.  i think you should have some diversification (foreign equity, small/mid cap, real estate and/or infrastructure).

jmo, tho.

I have a target fund in an IRA with Vanguard.  My understanding is that it switches allocations from stock heavy to more bonds the closer it gets to the retirement date. 

My main reason for going with the target fund is because I have a Betterment account with tax loss harvesting (stocks drop low enough, it sells the stock and replaces it with a similar one so you can deduct the loss on taxes), and I want to completely avoid any grey area when it comes to buying/selling the same stock in a short amount of time (which the SEC frowns upon).

[treysolid]

oth, if your target fund holds stuff in other cap ranges and international, and you are talking about taking all of that and putting it into an sp500 fund, i would not do that.

Yeah, that is essentially the question.  The bonds held in the retirement fund i think are pointless, but the fund is diversified.  I am essentially trading more stocks/less fees for less diversification.  I'm trying to figure out if it is worth it.

IMO, proper diversification is really important. not only regarding the right mix of international/emerging/domestic and real estate/commodities, but also large/mid/small cap as well as value vs. growth. One that people don't really look at is sector diversity. Your SP500 index fund (and most likely your target fund as well) is going to be pretty heavy on industrials, financials, healthcare, and technology, and really underrepresented in sectors like basic materials, energy, telecommunications, and utilities.

[Kat Kid]

k.  sounds like I am staying put.

[sys]

why not put it into multiple funds yourself?  may not get .1 of fee savings, but you should realize some savings.

[Kat Kid]

why not put it into multiple funds yourself?  may not get .1 of fee savings, but you should realize some savings.

It will definitely increase my fees and I would definitely be doing a worse job of managing it than just putting the funds in the target fund.

[sys]

why not put it into multiple funds yourself?  may not get .1 of fee savings, but you should realize some savings.

It will definitely increase my fees and I would definitely be doing a worse job of managing it than just putting the funds in the target fund.

it would decrease your fees.  you can get intl and small/mid cap funds for well under .16.  real estate or the like might be a little over but the mix would be well under .16  you could prolly nix the real estate w. no real issues for that matter.

if you like the target fund, just move them into same %s as held by your target fund.  no mgmt change.

[sys]

vti - fee is .05
vxus - fee is .13

your blended fee should be like. .07-.09 depending on how much you put in intl.  if you want to dribble a little into vnq and/or vpu it might raise your blended fee by like .005 or something.


if you want to go to the bogleheads forum there are thousands of people there just salivating to tell you all their fantastic ideas on how to passively manage your investments.  it might be your style.

[Kat Kid]

vti - fee is .05
vxus - fee is .13

your blended fee should be like. .07-.09 depending on how much you put in intl.  if you want to dribble a little into vnq and/or vpu it might raise your blended fee by like .005 or something.


if you want to go to the bogleheads forum there are thousands of people there just salivating to tell you all their fantastic ideas on how to passively manage your investments.  it might be your style.

I am not opposed to doing what you said, but I want to know what steve dave is doing so that I can watch his hopes and dreams rise and fall with my own.

[steve dave]

kat kid, are you the type of person that will consistently re-balance your portfolio without shooting your dick off?