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Old 12-28-2016, 01:50 PM   #1361
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Finally! Bonds are up from where I purchased them on 12/14 and VTI (Total US Market) is down about a percent. Numbers are tricky because both BND and VTI paid distributions in the meantime which have to be taken into account.

So while I didn't do the best possible trades then, I didn't hurt my portfolio any worse than doing nothing ... so far.

Lots of dividends paid yesterday, today, and tomorrow, so I have some cash to buy a few things. With such pocket change, I usually just try to round up positions to the nearest 100 share amount. For instance, if I have 423 shares of BND, then I'll try to buy 77 more shares to get to 500 shares regardless of my asset allocation.
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Old 12-30-2016, 08:19 PM   #1362
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I wanted to give a rough idea of how that rebalancing move from VTI to BND on the day of the FOMC press conference has worked out so far. Below is a M* chart of the mutual fund shares (instead of the ETF shares), so VTSAX and VBTLX over the last couple of weeks.



One can see in the chart above that the relative change of VTI/VSTAX and BND/VBTLX was about the same until the past couple of days when a gap opened up. Since I traded intraday, my "gap" is a little bit different than the one shown in the chart.

Although the difference could close up again, this 2% difference on about 1% of the portfolio didn't hurt the performance for the year. This rebalancing move worked. 264
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Old 12-31-2016, 11:57 AM   #1363
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So on a rainy morning I have time to look at the portfolio results of the past year. The portfolio (which today Fidelity Guided Portfolio Summary says is 58% equities with 30% in US and 28% in international) outperformed its benchmarks by 1.7% to 1.9%. And despite an almost 50% weight of equities to the laggard foreign equities, it outperformed the Vanguard Balanced Index fund which has US equities and no foreign equities.

A drill down shows that the fixed income portion actually underperformed the 2.6% total return of VBTLX (Vanguard Total Bond Index). I will attribute that to market timing out of bonds when I needed to increase temporarily my stock allocation.

I thought that maybe part of the outperformance was that I successfully market-timed buying and selling of international funds VEA, VSS, VEU, and VTIAX. That matches the reality since a benchmark international fund VTIAX (Vanguard Total Int'l) was up 4.6% for the year, my international funds were up 6.4% which is really not enough to overcome the underperformance of the fixed income side of the portfolio.

So moving on to US equities shows that's where outperformance really happened. I have about half my US equities in small-cap value funds which were nicely volatile in 2016, so that one could buy low. For 2016, SCV in my portfolio returned 27.9% which is about double the 12.7% return of VTSAX (Vanguard Total US Stock Index). OTOH, the performance of VSIAX (Vanguard small-cap value index) for 2016 was 24.8% for someone who held it the entire year, so market timing added only another 3% extra return.

I have large chunks of the portfolio in assets that were purchased back in the spring of 2009 and are in "buy-and-hold" mode, so I get whatever those returns are. These include a large-cap US index fund and a large-cap international index fund.

All this means that probably all the 1.9% outperformance really came from overweighting small caps this year and it is wishful thinking that market timing was a significant factor. So when you are in the right asset class, things go well for you.

Good luck to everyone in 2017!
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Old 12-31-2016, 12:04 PM   #1364
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Be careful using Fidelity website for asset allocation. About three weeks ago FSEVX which is an extended market index shot to 19% cash. I queried Fidelity and they said that fund actually has minimal cash (it is tracking index well) but that Morningstar, who provides the data to Fidelity, has made the error. Checked again with Fidelity again this week and they confirmed error not fixed in time for end of year. I also noticed that FXSIX shows 3% cash which is also far out of line.

So, I have to wait to see how close I am to my 60% target in equities. Two weeks ago the rep told me to add 2.3% to equities showing on website for total equities; I have no idea if that is still accurate today.

Just wanted to provide a heads up to anyone using Fidelity (or I imagine Morningstar) tools.

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Old 12-31-2016, 01:07 PM   #1365
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Thanks, I don't have those funds, but I do notice that Fidelity GPS is slightly off from Vanguard Portfolio Watch which has its own set of problems.
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Old 01-02-2017, 05:35 PM   #1366
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Quote:
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Be careful using Fidelity website for asset allocation. About three weeks ago FSEVX which is an extended market index shot to 19% ….
I explored this some more by adding a fake manual account called "Benchmark" to my Fidelity GPS tool. I can select it to see what Fido GPS says the asset allocation is after populating with a benchmark fund. Here is what it looks like when VSMGX is used (Fido on right or top; Vanguard on left or bottom):


Vanguard.com shows about 1% more than Fido in international stock.

So now that I am aware of that, I will just accept that these numbers cannot be more accurate than one or two percentage points which is OK with me.

Thanks for the heads up!
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Old 01-02-2017, 06:03 PM   #1367
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Gotta ask...the three digit integer ending most of your recent posts?
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Old 01-04-2017, 03:24 PM   #1368
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Today was a great day all around in the stock market. Everything made money. So it is not a bad day to look at some trades during the election 2 months ago. Here is a post from back then:

Quote:
Originally Posted by LOL! View Post
I'm not so sure it was good eyes at all as now my typical display of today's price changes doesn't seem to reflect at all what I was seeing this morning.

But the VSS shares are up and since I sold some bond fund shares yesterday to get the cash to buy equities, I avoided the downtick in those bond fund shares if I had not sold.

All this means that probably everything will tank tomorrow, but I hope not.
While I have already done some rebalancing, I am happy to report that the bond shares sold in the above post are still down about 2.5%, the foreign equities bought with that money are finally in the black. So that chunk of money is about 4% better off than doing nothing.

Of course, I would have been much better off buying US small-cap value with the money from selling bonds, but I didn't. A rising tide will float all non-bond boats eventually.

So far in the past 8 days, I am doing some minor portfolio management:

a. Charitable giving in 2016.

b. Got all my dividends that won't be spent reinvested last week.

c. Converting traditional IRA to Roth IRA, buying equities with the new Roth IRA assets and exchanging from equities to bonds in tax-deferred accounts to keep my asset allocation where I want it to be. That is: Stocks in Roth; Bonds in tax-deferred.
992 <- Double secret code digits
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Old 01-05-2017, 01:33 PM   #1369
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I didn't expect to post so soon after yesterday's post, but today's market action compelled me to make some trades. US stocks and particularly US small-cap value have dropped while foreign stocks and particular foreign small-cap have gone up. For instance, VSS is up 1% and DGS is up about 1%, too, while VBR was down about 1% and IJS was down more than 1.5% at one point.

Add to above that bond funds were up about 0.4% earlier today when bond funds should not move so much in a single day.

That's a 2% to 2.5% spread between these two asset classes that should be reasonably correlated. So with the fact that VSS is up 3% this year, all this spells OPPORTUNITY. So I sold some VSS and DGS and bought some IJS. I will also submit an order to exchange VBTLX into VSIAX.

A side benefit of the above trades is that I reduce the number of ETFs used in a couple of accounts, so I get some portfolio simplification, too.

If IJS (small-cap-value) goes up after this in the next few days, I will probably sell VBR in another account and buy back shares of a bond ETF. Or if it has been more than 3 days, I will just sell IJS and buy AGG. That's the plan.

Oh, if IJS and VBR go down more, then I will just hang on like the last time until they come back up or buy more.
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Old 01-09-2017, 08:56 AM   #1370
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Perhaps not unexpected, so far the things I bought late last week are down more than the things I sold. So I'm happy that I sold, but not so happy that I bought too soon.

I've submitted a sale of fixed income in a 529 plan to pay some college expenses, but bonds have gone up in the past few weeks, so this sale is of little consequence.

This post is mostly my attempt to try to talk the market into going up.
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Old 01-10-2017, 09:30 AM   #1371
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Thinking of switching Wellington Income to Wellesley. Any opinions out there?
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Old 01-10-2017, 04:11 PM   #1372
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Thinking of switching Wellington Income to Wellesley. Any opinions out there?
With no context how could one have an opinion? Any comments would just be contributing to the noise like lots of articles on the internet. These funds are invested in similar things, but only the ratio of equities to bonds is different. Wellesley is 38% stocks, 62% bonds and Wellington is 66% stocks, 34% bonds.

So you are suggesting that you will reduce equities and increase bonds in your portfolio. If Wellington is 100% of your portfolio, then this is a terribly drastic change. If Wellingtion is 10% of your portfolio, then it probably is of no consequence. Since we cannot predict the future, we have no idea whether such a shift will be helpful (whatever "helpful" might mean) or not. And we have no idea what your asset allocation plan is anyways.

Sorry to be unhelpful, but your question kinda has no answer or room for opinions.
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Old 01-10-2017, 07:58 PM   #1373
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Originally Posted by Marc View Post
Be careful using Fidelity website for asset allocation. About three weeks ago FSEVX which is an extended market index shot to 19% cash. I queried Fidelity and they said that fund actually has minimal cash (it is tracking index well) but that Morningstar, who provides the data to Fidelity, has made the error. Checked again with Fidelity again this week and they confirmed error not fixed in time for end of year. I also noticed that FXSIX shows 3% cash which is also far out of line.
More on this: A thread at bogleheads.org had a link to a holdings report showing holdings for a Fidelity fund that showed that it did have a lot of cash. The cash was collateral for shares that it had lent out. I suspect that Fidelity reps didn't know the full story. Since the fund benefits by the share price changes of shares that are lent out and gets cash payments for any dividends that the shares get, that it would be OK for Fidelity to state the cash fraction was low even if the holdings showed cash-in-lieu-of the shares lent out.
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Old 01-12-2017, 09:09 AM   #1374
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Today I admit total defeat of my last trade of DGS for IJS. I've certainly dug myself a small hole on this one. At close of yesterday the exchange of VBTLX to VSIAX was even with VSIAX the same price it was bought at, but unless a miracle happens later today, the trade would have been better avoided.

OTOH, my portfolio is ahead of my benchmarks for the year, but this one still stings.
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Old Yesterday, 09:23 AM   #1375
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Thoughts on this?

Investors are bracing for a massive stock-market selloff
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Old Yesterday, 11:04 AM   #1376
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I read that bit of financial porn over the the weekend. My thought was simply, "Great! I don't mind rebalancing into equites after they drop. Besides, all I want to do is outperform my benchmarks. And since 2016 was great and 2017 has been good so far, I have some room to have to losses without worry and still outperform my benchmarks."

But you cannot ask about thoughts without providing your own thoughts.
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