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Old 01-03-2018, 08:31 PM   #41
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I rebalanced on the 1st before noon. Vanguard couldn't do anything until the 2nd, naturally, but I was glad to have finished doing it. It's so simple, and yet can be so stressful for some of us. I checked and everything is fine. After closing today, instead of 45:55 I have (45.30) : (54.70) due to another day of market advances. Good enough.
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Old 01-03-2018, 08:40 PM   #42
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I have been waiting until after my RMD's on Jan. 5 to rebalance .So far it has worked to my advantage .
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Old 01-03-2018, 09:02 PM   #43
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I rebalance in November. Too many procrastinators, money managers and RMDrs taking profits, losses, and such on either side of the new year.

Is rebalancing easier or more difficult POST ER and why?
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Old 01-03-2018, 09:06 PM   #44
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I rebalance in November. Too many procrastinators, money managers and RMDrs taking profits, losses, and such on either side of the new year.

Is rebalancing easier or more difficult POST ER and why?
For me, it just is what it is. Whether before or after ER, I always rebalance ASAP in the New Year as my financial plan directs. I also rebalance if/when my equity allocation goes below 42.5% or above 47.5%. Having these two rules defining when I rebalance helps to keep me from being tempted to market time.

It's never been easy for me, because rebalancing requires juggling around relatively large amounts of money, and I don't often do that. The feeling is similar to my feeling when taking a large cashier's check from my real estate closing to my bank when I sold my house (2 years ago). Kind of nerve-wracking. I was relieved to have that check deposited and to see it show up in my bank account later that day.

Similarly, now I am relieved to be done with my annual rebalancing and to see that I didn't mess up and that what I see in Vanguard online is what I intended to see - - a 45:55 AA that is now subject to the usual minor daily variations, not a 97:03 AA or something unintended like that due to some error or other.
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Old 01-03-2018, 09:09 PM   #45
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I scheduled all my rebalancing on 12/30, since that was a Saturday and processing wouldn't happen until 1/2. Checked today, and everything got moved fine. Not too bad. I only rebalance once a year, so I'm all set til 2019.
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Old 01-03-2018, 09:31 PM   #46
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Market advanced some more today, pushing more of my covered-call options into the money.

Stocks up 1.20%. Minus loss due to options, and diluted by MFs and cash, portfolio up 0.78%.

Still waiting for the shoe to drop, to borrow from Live and Learn. Any day now, I guess.
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Old 01-03-2018, 09:36 PM   #47
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Market advanced some more today, pushing more of my covered-call options into the money.

Stocks up 1.20%. Minus loss due to options, and diluted by MFs and cash, portfolio up 0.78%.

Still waiting for the shoe to drop, to borrow from Live and Learn. Any day now, I guess.
Tomorrow, plummeting down 20% and more. Just kidding.

Seriously, the Dow only increased 99 points today (out of nearly 25,000). It's always going to go up, or down, sometimes 2 figures like this, and sometimes even 3.

Edited to add: I was staring at this and wondering if the Dow had ever gone up by 4 figures. Finally I just had to look it up. The largest one day increase in the Dow was 936.42 points on 10/13/2008. The largest one day decrease in the Dow was 777.68 points on 9/29/2008. What a volatile year that was!!

https://en.wikipedia.org/wiki/List_o...strial_Average
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Old 01-04-2018, 12:17 AM   #48
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If the idea of rebalancing is to reduce the loss if the market drops, then it works for me. In 2017, I picked up an extra 2% return selling options that mostly expired worthless.

If the market drops big, then that 2% would not be enough. If one anticipates that, then severely reducing stock AA would be the only thing that could help. I may still do that tactical AA if things start to look bad.
I meant the kind of rebalancing where people sometimes claim that "the market rebalanced for me" meaning that equities dropped and got them back to their target allocation. Which is not rebalancing of course. They didn't rebalance when their equities or whatever were high, so they lost the opportunity.

I thought you were making a similar remark:
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I wrote several call options with Jan 19 expiry.

If those stocks keep on going, somebody will buy these shares from me at even higher prices than now. That will trim my AA.

If the market bombs, I still have the shares, but the stock AA also gets trimmed due to price dropping.
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Old 01-04-2018, 06:02 AM   #49
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All done.
Me too.

At some point I will go to a single fund and avoid the re-balancing task. The unfortunate part of a single fund is that withdrawals then come from both stocks and bonds instead of just the better performing fund, but the simplicity will outweigh the advantage at some point/age. Also, you lack more granular control over the equity/income split in a single fund, but I expect that's also OK at some point/age.
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Old 01-04-2018, 07:55 AM   #50
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Me too.

At some point I will go to a single fund and avoid the re-balancing task. The unfortunate part of a single fund is that withdrawals then come from both stocks and bonds instead of just the better performing fund, but the simplicity will outweigh the advantage at some point/age. Also, you lack more granular control over the equity/income split in a single fund, but I expect that's also OK at some point/age.
Yeah - Iíd rather use multiple funds. What I suspect will happen when I donít want to deal with rebalancing anymore is Iíll just stop rebalancing and let the funds run on their own. Taking distributions in cash. Should be good enough.
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Old 01-04-2018, 08:34 AM   #51
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Me too.

At some point I will go to a single fund and avoid the re-balancing task. The unfortunate part of a single fund is that withdrawals then come from both stocks and bonds instead of just the better performing fund, but the simplicity will outweigh the advantage at some point/age. Also, you lack more granular control over the equity/income split in a single fund, but I expect that's also OK at some point/age.
I purchased my first balanced fund ever the other day. I won't ever get to just one fund as I like having a good chunk of cd's and a couple of index specific funds, but I do plan to consolidate quite a bit to the balanced fund over time. Going for more simplicity as I age.
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Old 01-04-2018, 08:58 AM   #52
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Yeah - I’d rather use multiple funds. What I suspect will happen when I don’t want to deal with rebalancing anymore is I’ll just stop rebalancing and let the funds run on their own. Taking distributions in cash. Should be good enough.
When do you suppose this decrease in abilities will occur? Having trouble imagining it for myself.

But every time I look at my spreadsheets I do worry just a bit.
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Old 01-04-2018, 09:13 AM   #53
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When do you suppose this decrease in abilities will occur? Having trouble imagining it for myself.

But every time I look at my spreadsheets I do worry just a bit.
I really don't know. Maybe late 70s? Certainly by then I hope to have several things figured out for aging - like where I'm going to live, as well as how investments are going to be handled. DH is 4.5 years older, so we'll have to figure out the where to age thing by his late 70s I think, so a bit earlier.

I have thought a lot about what I will do when I want to leave things alone, as I have to take steps now to move in that direction over decades in order to minimize tax consequences. But I can only guess as to when that will actually happen. I just want to have it set up so that at any point I can just leave things alone.

I think I didn't want to just put things in a balanced or target fund as those are not that tax efficient, and it would mean realizing a lot of gains to transfer everything in short time frame.

Instead I am gradually drifting over to a five index fund setup that I will rebalance as long as I can. And then leave well enough alone.

I'm hoping between distributions in cash from the mutual funds and an automatic set up of RMDs, I can have bank accounts funded and not have to worry about details.
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Old 01-04-2018, 09:22 AM   #54
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In my old 401k days, I rebalanced by entering the AA pct's for each fund and the website rebalanced to the specified pct's for me. I haven't found this available on the Vanguard site. When Vanguard customers rebalance, do they have to calculate how much $ to move and then do a buy/sell of that $ between funds? Or does Vanguard have a system where you enter your targeted fund pct and it takes care of everything? Or do you have a Vanguard rep do it for you?
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Old 01-04-2018, 09:32 AM   #55
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Fidelity does not have this capability in general. The only places I've seen it are my HSA account (maybe in the past?) and our Fidelity Charitable Fund.

When I am old enough I don't think I'll even want to deal with that step - entering percentages.
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Old 01-04-2018, 09:43 AM   #56
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...When I am old enough I don't think I'll even want to deal with that step - entering percentages.
Me either. At that point, I'll just get a target retirement fund. I believe they rebalance on their own.
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Old 01-04-2018, 09:45 AM   #57
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I meant the kind of rebalancing where people sometimes claim that "the market rebalanced for me" meaning that equities dropped and got them back to their target allocation. Which is not rebalancing of course. They didn't rebalance when their equities or whatever were high, so they lost the opportunity.

I thought you were making a similar remark.
Yes, it is similar except that I get a bit of cash from the option premium as compensation.

It is a compromise as I like my stocks too much to sell them outright.

Buying low is not a problem I have, but selling high is mightily tough.
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Old 01-04-2018, 10:31 AM   #58
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Me either. At that point, I'll just get a target retirement fund. I believe they rebalance on their own.
Thatís a good choice for an IRA. Although at that age it will have probably gone well past any targets.

In my taxable accounts I canít easily move money between funds. Doing so will realize sizable gains.
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Old 01-04-2018, 10:33 AM   #59
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Yes, it is similar except that I get a bit of cash from the option premium as compensation.

It is a compromise as I like my stocks too much to sell them outright.

Buying low is not a problem I have, but selling high is mightily tough.
Rebalancing enforces that discipline. In selling high you are just making a usually small trim. The remainder of the position is there to keep running higher if that happens.
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Old 01-04-2018, 10:47 AM   #60
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I really don't know. Maybe late 70s? Certainly by then I hope to have several things figured out for aging - like where I'm going to live, as well as how investments are going to be handled.
I am struggling with similar things, e.g., where to live and financial management, etc. Eventually, it will work out regardless.
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