p********r
发帖数: 1980 | 1 Although US stock markets are at all-time high at the moment, when Big Ben
indicated that FED will stop QE soon, from May 22 to June 24, the S&P 500
lost 5.6%, MSCI EAFE lost 10.1%, MSCI Emerging fell 15.3%, the Dow Jones/UBS
Commodity index fell 4.5%, the U.S. 10-year T-Note fell 4.4%, and the
Barclays U.S. TIPS index fell 7.1%, the J.P. Morgan Emerging Debt Global
index fell 10.8%, the German 10-year Bund fell 5.2%, the UK 10-year Gilt
fell 3.4%, and the Australian 10-year bond fell 6.5%.
FED later backtracked on when they will stop QE, but we all know that it
will stop some day.
What is your current asset allocation plan, when apparently everything drops
when FED will start to stop QE? | S**C
发帖数: 2964 | 2 I am 20% in cash, 20% in bond (mostly outside treasury), 30% US (most if not
all in LC), and 30% in Foreign. In Foreign, 25% is in EMU, 60% in Asia. I
would rather have zero in EMU, but I cannot because of 401(k) options.
I do not plan to do anything unless equity market down significantly, then I
will buy, or the situation in China worsen decisively, in which case I will
scale back Asia exposure.
UBS
drops
【在 p********r 的大作中提到】
: Although US stock markets are at all-time high at the moment, when Big Ben
: indicated that FED will stop QE soon, from May 22 to June 24, the S&P 500
: lost 5.6%, MSCI EAFE lost 10.1%, MSCI Emerging fell 15.3%, the Dow Jones/UBS
: Commodity index fell 4.5%, the U.S. 10-year T-Note fell 4.4%, and the
: Barclays U.S. TIPS index fell 7.1%, the J.P. Morgan Emerging Debt Global
: index fell 10.8%, the German 10-year Bund fell 5.2%, the UK 10-year Gilt
: fell 3.4%, and the Australian 10-year bond fell 6.5%.
: FED later backtracked on when they will stop QE, but we all know that it
: will stop some day.
: What is your current asset allocation plan, when apparently everything drops
| p********r
发帖数: 1980 | 3 What are the key indicators that you monitor for China?
I have less bond and more cash, otherwise we have similar AA. It of course
seems to be stupid holding cash which has a guaranteed negative real returns
but I cannot find any other attractive options (other than a few risky
individual stock picks).
I felt pretty bullish about RE last year but not so much after this bull run
in price (together with 1% increase in the mortgage rate recently).
not
I
will
【在 S**C 的大作中提到】
: I am 20% in cash, 20% in bond (mostly outside treasury), 30% US (most if not
: all in LC), and 30% in Foreign. In Foreign, 25% is in EMU, 60% in Asia. I
: would rather have zero in EMU, but I cannot because of 401(k) options.
: I do not plan to do anything unless equity market down significantly, then I
: will buy, or the situation in China worsen decisively, in which case I will
: scale back Asia exposure.
:
: UBS
: drops
| S**C
发帖数: 2964 | 4 Housing. Nothing really fancy.
I do not know any asset bubble that ended well. But this time **might** be
different as China housing bubble comes with rapid economic growth. An
overvaluation might be worked off rather quickly in places where economy
grows at 6-8%, without inevitable bubble busting in place where economy
grows at 1-3% (Japan/US/EU).
So it is possible, but the stars need to aligned for China and the China
policymakers pull the right string at the right time, it will be a very
tough balancing act. A sharp slow down in economy growth would trigger the
burst of housing bubble, and slow down China future growth considerably.
returns
run
【在 p********r 的大作中提到】
: What are the key indicators that you monitor for China?
: I have less bond and more cash, otherwise we have similar AA. It of course
: seems to be stupid holding cash which has a guaranteed negative real returns
: but I cannot find any other attractive options (other than a few risky
: individual stock picks).
: I felt pretty bullish about RE last year but not so much after this bull run
: in price (together with 1% increase in the mortgage rate recently).
:
: not
: I
| r*******y
发帖数: 290 | 5 The US seems to be doing pretty well this year compared with other markets
I am overweight in US equities and have some international equities,
very little emerging market equities now. China is a long term play (at
least 3 years).
not
I
will
【在 S**C 的大作中提到】
: I am 20% in cash, 20% in bond (mostly outside treasury), 30% US (most if not
: all in LC), and 30% in Foreign. In Foreign, 25% is in EMU, 60% in Asia. I
: would rather have zero in EMU, but I cannot because of 401(k) options.
: I do not plan to do anything unless equity market down significantly, then I
: will buy, or the situation in China worsen decisively, in which case I will
: scale back Asia exposure.
:
: UBS
: drops
| S**C
发帖数: 2964 | 6 I was overweight in US high quality stocks, but recently I reduced a little
bit of US, and move a little bit to EM, which seems to be the only asset
class left that is fairly valued.
【在 r*******y 的大作中提到】
: The US seems to be doing pretty well this year compared with other markets
: I am overweight in US equities and have some international equities,
: very little emerging market equities now. China is a long term play (at
: least 3 years).
:
: not
: I
: will
| D*****t
发帖数: 558 | 7 55% stock, 45% bond.
of stocks, 70% US, 30% foreign (of which, 45% EM)
of bonds, 30% TIPS, 60% short term investment grade, <10% high yield
i don't plan to do anything unless market moves and my allocation is off
target by at least 5%, then i will rebalance.
i also have a negligible position in gold stocks, which i started adding
since May, just for the fun of it. | E******w
发帖数: 2616 | 8 100% cash. Just to show that I am doing what I suggest other people to do.
UBS
drops
【在 p********r 的大作中提到】
: Although US stock markets are at all-time high at the moment, when Big Ben
: indicated that FED will stop QE soon, from May 22 to June 24, the S&P 500
: lost 5.6%, MSCI EAFE lost 10.1%, MSCI Emerging fell 15.3%, the Dow Jones/UBS
: Commodity index fell 4.5%, the U.S. 10-year T-Note fell 4.4%, and the
: Barclays U.S. TIPS index fell 7.1%, the J.P. Morgan Emerging Debt Global
: index fell 10.8%, the German 10-year Bund fell 5.2%, the UK 10-year Gilt
: fell 3.4%, and the Australian 10-year bond fell 6.5%.
: FED later backtracked on when they will stop QE, but we all know that it
: will stop some day.
: What is your current asset allocation plan, when apparently everything drops
| S**C
发帖数: 2964 | 9 When do you move to cash, and at what condition do you plan to re-enter the
market?
【在 E******w 的大作中提到】
: 100% cash. Just to show that I am doing what I suggest other people to do.
:
: UBS
: drops
| E******w
发帖数: 2616 | 10 I did not quite understand the market before, although I do understand the
traps in
the 401K plan. So I did not dare to touch S&P before. I put money in a real
estate fund after the housing crisis, and moved to cash when I see the
danger of rising interest rate. I have been studying S&P for a while, and
plan to re-enter the S&P index around this time next year if the next
economic crisis hit. I think S&P may hit a bottom in late summer next year.
But the timing need to be adjusted depending on how things unfold.
the
【在 S**C 的大作中提到】
: When do you move to cash, and at what condition do you plan to re-enter the
: market?
| | | H*****1
发帖数: 4815 | 11 Could you explain the traps in 401K?
Thanks!
real
.
【在 E******w 的大作中提到】
: I did not quite understand the market before, although I do understand the
: traps in
: the 401K plan. So I did not dare to touch S&P before. I put money in a real
: estate fund after the housing crisis, and moved to cash when I see the
: danger of rising interest rate. I have been studying S&P for a while, and
: plan to re-enter the S&P index around this time next year if the next
: economic crisis hit. I think S&P may hit a bottom in late summer next year.
: But the timing need to be adjusted depending on how things unfold.
:
: the
| r****m
发帖数: 1204 | 12 If you are so confident S&P may hit a bottom again, why not buying put on it? | E******w
发帖数: 2616 | 13 How can you buy put in a 401K account? I am shorting S&P in a regular stock
trading account. I mean, I have a plan of shorting it, although I do not
have any position now.
it?
【在 r****m 的大作中提到】
: If you are so confident S&P may hit a bottom again, why not buying put on it?
| E******w
发帖数: 2616 | 14 A simple answer is "fees". Usually maintenance fees are charged when you
hold whatever fund in the 401K account. The fees can be higher than what
they show in the fund perspective. Typical fee is 1~2% per year, some fancy
funds have over 3% charge per year. Note that this is not 3% of your profit,
it is 3% of your total fund value. For a rough calculation, if you hold the
fund for 10 years and the stock price does not change, your account will
lose about 20%. Now, if you do not know how to trade stocks, you will have
stock trading losses on top of that. They just collect the fees at no risk.
This is why all the financial advisors just tell you how to allocate money
between equity and bonds. They never tell you to hold cash sine they want to
make sure they can collect fees from your account. They also tell you to "
invest for the long term" since they want to collect fees as long as
possible.
Anyway, the political and financial worlds are full of traps. Do not ever
believe that you can do well by reading the textbooks or by listening to any
advisor. You have to understand it yourself.
【在 H*****1 的大作中提到】
: Could you explain the traps in 401K?
: Thanks!
:
: real
: .
| s******d
发帖数: 9806 | 15 "The fees can be higher than what
they show in the fund perspective. Typical fee is 1~2% per year, some fancy
funds have over 3% charge per year"
I thought many of the index MF only have fees around 0.1%...
fancy
profit,
the
to
【在 E******w 的大作中提到】
: A simple answer is "fees". Usually maintenance fees are charged when you
: hold whatever fund in the 401K account. The fees can be higher than what
: they show in the fund perspective. Typical fee is 1~2% per year, some fancy
: funds have over 3% charge per year. Note that this is not 3% of your profit,
: it is 3% of your total fund value. For a rough calculation, if you hold the
: fund for 10 years and the stock price does not change, your account will
: lose about 20%. Now, if you do not know how to trade stocks, you will have
: stock trading losses on top of that. They just collect the fees at no risk.
: This is why all the financial advisors just tell you how to allocate money
: between equity and bonds. They never tell you to hold cash sine they want to
| S**C
发帖数: 2964 | 16 http://www.shrm.org/hrdisciplines/benefits/Articles/Pages/401k-
"The average total plan cost—including administrative and record-keeping
fees—for a small 401(k) plan (50 participants/$2,500,000 assets) declined
from 1.47 percent to 1.46 percent. These fees are calculated as a percentage
of assets under management in the plan."
The above is the all inclusive fees, including the funds ER. So I think you
either are in a terrible 401(k) plan, or misunderstand the fees. I do not
think funds ER should be included as 401(k) plan fees, unless they are
offered as a special class that are higher than the ER of retail version MFs
, then you probably can add the difference.
fancy
profit,
the
to
【在 E******w 的大作中提到】
: A simple answer is "fees". Usually maintenance fees are charged when you
: hold whatever fund in the 401K account. The fees can be higher than what
: they show in the fund perspective. Typical fee is 1~2% per year, some fancy
: funds have over 3% charge per year. Note that this is not 3% of your profit,
: it is 3% of your total fund value. For a rough calculation, if you hold the
: fund for 10 years and the stock price does not change, your account will
: lose about 20%. Now, if you do not know how to trade stocks, you will have
: stock trading losses on top of that. They just collect the fees at no risk.
: This is why all the financial advisors just tell you how to allocate money
: between equity and bonds. They never tell you to hold cash sine they want to
| E******w
发帖数: 2616 | 17 I did say "typical fee" is between 1~2%. Some fancy funds, like those
provided by Fidelity (they have much more choices than other brokers), have
over 3% cost per year. In addition, I never trust the published numbers
since they are usually smaller than the actual cost. I have my own way of
calculating the cost. If my $100 became $95 in one year, then the cost is 5%
. No matter how many articles you show me, I won't trust any other number.
fancy
【在 s******d 的大作中提到】
: "The fees can be higher than what
: they show in the fund perspective. Typical fee is 1~2% per year, some fancy
: funds have over 3% charge per year"
: I thought many of the index MF only have fees around 0.1%...
:
: fancy
: profit,
: the
: to
| D*****t
发帖数: 558 | 18 I could be wrong, but you might misread this paragraph."The average total
plan cost—including administrative and record-keeping fees—for a small 401
(k) plan (50 participants/$2,500,000 assets) declined from 1.47 percent to 1
.46 percent. "
My understanding is that the fee mentioned here is the fee at plan level and
does not include fund ER.
In the next paragraph, "Small plan average investment expenses—the expense
ratios charge by mutual funds for assets held within the plan—went from 1.
38 percent to 1.37 percent." This probably refers to fund expense.
So all together, the average fee (plan level + fund expense) of a small plan
is 1.46 + 1.37 = 2.83. This sounds awfully high to me.
That being said, to generalize all 401K plans as traps is unfair. My plan
costs me 0.33%, and on top of that I pay very low fund ER since I use VG
index funds.
percentage
you
MFs
【在 S**C 的大作中提到】
: http://www.shrm.org/hrdisciplines/benefits/Articles/Pages/401k-
: "The average total plan cost—including administrative and record-keeping
: fees—for a small 401(k) plan (50 participants/$2,500,000 assets) declined
: from 1.47 percent to 1.46 percent. These fees are calculated as a percentage
: of assets under management in the plan."
: The above is the all inclusive fees, including the funds ER. So I think you
: either are in a terrible 401(k) plan, or misunderstand the fees. I do not
: think funds ER should be included as 401(k) plan fees, unless they are
: offered as a special class that are higher than the ER of retail version MFs
: , then you probably can add the difference.
| E******w
发帖数: 2616 | 19 Well, take Fidelity for example, they have several core funds with very low
cost. S&P index is one of them. So Fidelity often use those funds to
advertise their "low cost" and "wide range of choices". But if you do choose
from those "wide range of choices", it is very likely that you will get a
high cost fund. Also, the published cost of those funds are much smaller
than the actual number.
You do not think those are designed with a purpose of "trap" in their mind?
401
1
and
expense
plan
【在 D*****t 的大作中提到】
: I could be wrong, but you might misread this paragraph."The average total
: plan cost—including administrative and record-keeping fees—for a small 401
: (k) plan (50 participants/$2,500,000 assets) declined from 1.47 percent to 1
: .46 percent. "
: My understanding is that the fee mentioned here is the fee at plan level and
: does not include fund ER.
: In the next paragraph, "Small plan average investment expenses—the expense
: ratios charge by mutual funds for assets held within the plan—went from 1.
: 38 percent to 1.37 percent." This probably refers to fund expense.
: So all together, the average fee (plan level + fund expense) of a small plan
| S**C
发帖数: 2964 | 20 I think you are right.
401
1
and
expense
plan
【在 D*****t 的大作中提到】
: I could be wrong, but you might misread this paragraph."The average total
: plan cost—including administrative and record-keeping fees—for a small 401
: (k) plan (50 participants/$2,500,000 assets) declined from 1.47 percent to 1
: .46 percent. "
: My understanding is that the fee mentioned here is the fee at plan level and
: does not include fund ER.
: In the next paragraph, "Small plan average investment expenses—the expense
: ratios charge by mutual funds for assets held within the plan—went from 1.
: 38 percent to 1.37 percent." This probably refers to fund expense.
: So all together, the average fee (plan level + fund expense) of a small plan
| | | D*****t
发帖数: 558 | 21 401K is a benefit offered by the employers. The fee structure (at plan level
) is negotiated btw your employer and the broker/asset management company.
so to blame just fidelity, for example, is kind of unfair. as an employee,
if you have a
terrible 401K plan (high fee, poor fund options), you should let you HR and
management/board know. Plus, if you consider the tax benefit of 401K plan,
do you have better options?
low
choose
【在 E******w 的大作中提到】
: Well, take Fidelity for example, they have several core funds with very low
: cost. S&P index is one of them. So Fidelity often use those funds to
: advertise their "low cost" and "wide range of choices". But if you do choose
: from those "wide range of choices", it is very likely that you will get a
: high cost fund. Also, the published cost of those funds are much smaller
: than the actual number.
: You do not think those are designed with a purpose of "trap" in their mind?
:
: 401
: 1
| E******w
发帖数: 2616 | 22 I am not complaining. I have my own plan to deal with these problems. I just
want to make a point that, you need to understand the traps in order to
avoid falling into one :-)
level
and
【在 D*****t 的大作中提到】
: 401K is a benefit offered by the employers. The fee structure (at plan level
: ) is negotiated btw your employer and the broker/asset management company.
: so to blame just fidelity, for example, is kind of unfair. as an employee,
: if you have a
: terrible 401K plan (high fee, poor fund options), you should let you HR and
: management/board know. Plus, if you consider the tax benefit of 401K plan,
: do you have better options?
:
: low
: choose
| S**C
发帖数: 2964 | 23 If the fees are that high (1%+) then I would consider using taxable account,
and in taxable account, tax efficiency become an additional issue, so index
funds could become more appealing. You hear it from an passive-active guy,
:-)
negotiated
just
and
【在 D*****t 的大作中提到】
: 401K is a benefit offered by the employers. The fee structure (at plan level
: ) is negotiated btw your employer and the broker/asset management company.
: so to blame just fidelity, for example, is kind of unfair. as an employee,
: if you have a
: terrible 401K plan (high fee, poor fund options), you should let you HR and
: management/board know. Plus, if you consider the tax benefit of 401K plan,
: do you have better options?
:
: low
: choose
| D*****t
发帖数: 558 | 24 to be precise, do you know of any studies showing that at certain fee level
(x%) the tax efficiency offered by 401K is essentially gone?
account,
index
,
【在 S**C 的大作中提到】
: If the fees are that high (1%+) then I would consider using taxable account,
: and in taxable account, tax efficiency become an additional issue, so index
: funds could become more appealing. You hear it from an passive-active guy,
: :-)
:
: negotiated
: just
: and
| D*****t
发帖数: 558 | 25 i guess you have also to consider your employer contribution.
level
【在 D*****t 的大作中提到】
: to be precise, do you know of any studies showing that at certain fee level
: (x%) the tax efficiency offered by 401K is essentially gone?
:
: account,
: index
: ,
| S**C
发帖数: 2964 | 26 Other data.
http://online.wsj.com/article/SB1000142412788732397120457862610
"The average amount sponsors of small plans reported paying for record-
keeping and administrative services was 1.33% of assets annually, compared
with 0.15% for large plans, according to an April 2012 study by the
Government Accountability Office."
401
1
and
expense
plan
【在 D*****t 的大作中提到】
: I could be wrong, but you might misread this paragraph."The average total
: plan cost—including administrative and record-keeping fees—for a small 401
: (k) plan (50 participants/$2,500,000 assets) declined from 1.47 percent to 1
: .46 percent. "
: My understanding is that the fee mentioned here is the fee at plan level and
: does not include fund ER.
: In the next paragraph, "Small plan average investment expenses—the expense
: ratios charge by mutual funds for assets held within the plan—went from 1.
: 38 percent to 1.37 percent." This probably refers to fund expense.
: So all together, the average fee (plan level + fund expense) of a small plan
| H*****1
发帖数: 4815 | 27 How do they collect fees without showing it on the statement? Do they sell
some stocks and re-allocate whatever left in the pool?
fancy
profit,
the
to
【在 E******w 的大作中提到】
: A simple answer is "fees". Usually maintenance fees are charged when you
: hold whatever fund in the 401K account. The fees can be higher than what
: they show in the fund perspective. Typical fee is 1~2% per year, some fancy
: funds have over 3% charge per year. Note that this is not 3% of your profit,
: it is 3% of your total fund value. For a rough calculation, if you hold the
: fund for 10 years and the stock price does not change, your account will
: lose about 20%. Now, if you do not know how to trade stocks, you will have
: stock trading losses on top of that. They just collect the fees at no risk.
: This is why all the financial advisors just tell you how to allocate money
: between equity and bonds. They never tell you to hold cash sine they want to
| E******w
发帖数: 2616 | 28 Strictly speaking, I mean "cost", not "fees". Some mutual funds simply buy
other funds and charge a fee on top of that. Say, if fund B buys fund A and
charge a 1% fee, your cost is the aggregated fees of both funds B and A,
while on the statement, you only see the maintenance fee of fund B.
Anyway, many of us believe that we can't manage our money well (this is
probably true). The professionals can do a better job and they are justified
to charge a fee for that. In reality, they simply buy other existing
products, and there is essentially no "maintenance" effort. They also do not
care about your performance so long as they can keep you on the hook to
feed them. Therefore, no matter whether you can do a good job or not, it is
always worth the effort to learn it and try to manage your money by yourself.
【在 H*****1 的大作中提到】
: How do they collect fees without showing it on the statement? Do they sell
: some stocks and re-allocate whatever left in the pool?
:
: fancy
: profit,
: the
: to
| H*****1
发帖数: 4815 | 29 Does Vanguard Total stock market index fund do this trick?
I think this is already a single fund that breaks down to combinations of
stocks not other funds, right?
and
justified
not
is
【在 E******w 的大作中提到】
: Strictly speaking, I mean "cost", not "fees". Some mutual funds simply buy
: other funds and charge a fee on top of that. Say, if fund B buys fund A and
: charge a 1% fee, your cost is the aggregated fees of both funds B and A,
: while on the statement, you only see the maintenance fee of fund B.
: Anyway, many of us believe that we can't manage our money well (this is
: probably true). The professionals can do a better job and they are justified
: to charge a fee for that. In reality, they simply buy other existing
: products, and there is essentially no "maintenance" effort. They also do not
: care about your performance so long as they can keep you on the hook to
: feed them. Therefore, no matter whether you can do a good job or not, it is
| E******w
发帖数: 2616 | 30 Yes, I think stock index funds like the Vanguard one are low cost in general
. One of the popular "theory" is that you can blindly put money in stock
index and forget about it. All 401K plans favor this "theory" in the sense
that their cost is low if you follow such a theory.
I personally do not believe in such a theory. It is simply another layer of
traps. But I do agree that it is better than paying high cost.
【在 H*****1 的大作中提到】
: Does Vanguard Total stock market index fund do this trick?
: I think this is already a single fund that breaks down to combinations of
: stocks not other funds, right?
:
: and
: justified
: not
: is
| | | a*p
发帖数: 209 | 31 Not all 401K plans charge fees. For my case, the only 'cost' is the fund ER.
I believe the employer pays for the 'admistration fee' to T.Rowe Price.
Following is an email from the TRowe Price:
Thank you for contacting T. Rowe Price regarding your account statements.
Account statements are only generated on a quarterly basis; annual account
statements are not currently available. However, information about the funds
' expense ratios is included in the performance information module that can
be added to the statements. Our records indicate that this module has been
added to your statements, along with other informational modules, and this
change will take effect for your first-quarter 2011 statement. You can also
view this information through your online access. From your account homepage
, place your cursor over the "Investments" tab and click on "Performance."
This page will default to the "My Funds" tab, which will list the funds you
own and their performance as of the end of the most recent month. Each fund'
s expense ratio will be listed in the "Expense Ratio" column on the right-
hand side of the page, along with the as-of date for the expense ratio.
Please note that a fund's expense ratio is an amount expressed as an
annualized percentage of total assets, and it represents what shareholders
pay for mutual fund operating expenses and management fees. This fee is
required to be disclosed in each fund's prospectus, along with any other
fund fees. The expense ratio is not deducted from your account directly;
rather, it is deducted from the net asset value (NAV) of the fund each day
at valuation. The NAV represents the closing market value of the fund, less
any expenses. I have confirmed that there are no other administrative fees
assessed on your account by the plan. If you have any further questions,
please do not hesitate to e-mail me again.
percentage
you
MFs
【在 S**C 的大作中提到】
: http://www.shrm.org/hrdisciplines/benefits/Articles/Pages/401k-
: "The average total plan cost—including administrative and record-keeping
: fees—for a small 401(k) plan (50 participants/$2,500,000 assets) declined
: from 1.47 percent to 1.46 percent. These fees are calculated as a percentage
: of assets under management in the plan."
: The above is the all inclusive fees, including the funds ER. So I think you
: either are in a terrible 401(k) plan, or misunderstand the fees. I do not
: think funds ER should be included as 401(k) plan fees, unless they are
: offered as a special class that are higher than the ER of retail version MFs
: , then you probably can add the difference.
|
|
