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I Rebalanced Wrong.....But I Came Out Ahead!
Old 02-04-2016, 08:16 PM   #1
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I Rebalanced Wrong.....But I Came Out Ahead!

A few weeks ago, I made a rebalancing move in my IRA because the stock portion had dropped enough to take me far enough away from my targeted AA of 50/50. But I stupidly rebalance the wrong way, moving $10k from stock bond fund to the bond fund, not the other way around like I planned to.

And dopey me, I didn't realize this for another week when, after the stock market dropped some more, I reviewed my AA again to see if another rebalancing move was needed. When I entered another rebalancing move of $10k I received a warning about a "round trip" move in the IRA. That is, a reverse transfer within a short time of a previous move. It then dawned on me that my earlier transfer was in the wrong direction. I canceled my proposed move and made a new one but for twice the amount ($20k) in order to undo the earlier move.

It turned out that the net amount from both moves enabled me to buy an extra $800 worth of shares in the stock fund than I would have done had I done my original $10k move correctly. So, my stupidity earned me an extra $800!

Any of you ever make a dumb move like this which paid off?

Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.

"I want my money working for me instead of me working for my money!"
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Old 02-04-2016, 09:36 PM   #2
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That's so cool! Congratulations.

I lucked out in a way that's a little bit similar, when I sold part of my portfolio to buy my dream house in cash. The day when it had to be done, was within one day of the May 2015 stock market high. So, I bought my house on a "blue light special", I suppose.

Then I sold my prior home and by the time I was able to put that cash into my portfolio, the market was down so I could buy more shares than otherwise. All of this house buying/selling good fortune was just blind luck, not market timing.
"You can never cross the ocean until you have the courage to lose sight of the shore." - - - C. Columbus
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