Finance guys inside please.....need some guidance.

[moddestmike]

Trying to reallocte 401k investment choices and I have quite a few to choose from. I'm specifically looking for market run info/opinions on BlackRock Equity Dividend Fund. I've been told to stay away from bond funds. Here are my choices: (I deliberately left out my companies stock options nominations because I keep this at the max that is 20%).


DWS Stable Value Trust - Institutional Shares
PIMCO Total Return Fund - Administrative Class
T. Rowe Price Retirement Income Fund - Advisor Class
T. Rowe Price Retirement 2010 Fund - Advisor Class
T. Rowe Price Retirement 2020 Fund - Advisor Class
T. Rowe Price Retirement 2030 Fund - Advisor Class
T. Rowe Price Retirement 2040 Fund - Advisor Class
T. Rowe Price Retirement 2050 Fund - Advisor Class
BlackRock Equity Dividend Fund - Institutional Class
Davis New York Venture Fund - Class A
Aston/Montag & Caldwell Growth Fund - Class N
Prudential Jennison Mid-Cap Growth Fund*-*Class A
DWS Stock Index Trust
Aston/River Road Small Cap Value - Class N
American Funds EuroPacific Growth Fund - Class R3
Entergy Corp New Common Stock

 

[JPD5801]

Trying to reallocte 401k investment choices and I have quite a few to choose from. I'm specifically looking for market run info/opinions on BlackRock Equity Dividend Fund. I've been told to stay away from bond funds. Here are my choices: (I deliberately left out my companies stock options nominations because I keep this at the max that is 20%).


DWS Stable Value Trust - Institutional Shares
PIMCO Total Return Fund - Administrative Class
T. Rowe Price Retirement Income Fund - Advisor Class
T. Rowe Price Retirement 2010 Fund - Advisor Class
T. Rowe Price Retirement 2020 Fund - Advisor Class
T. Rowe Price Retirement 2030 Fund - Advisor Class
T. Rowe Price Retirement 2040 Fund - Advisor Class
T. Rowe Price Retirement 2050 Fund - Advisor Class
BlackRock Equity Dividend Fund - Institutional Class
Davis New York Venture Fund - Class A
Aston/Montag & Caldwell Growth Fund - Class N
Prudential Jennison Mid-Cap Growth Fund*-*Class A
DWS Stock Index Trust
Aston/River Road Small Cap Value - Class N
American Funds EuroPacific Growth Fund - Class R3
Entergy Corp New Common Stock

2 things:

1. Past performance is NOT a predictor of future results. There is a reason every fund company plasters that warning on all their materials. There are no good (reliable) predictors of future results - sorry to spoil the fun.

2. Please read this study before you attempt to self direct your account. It is a little technical, so here are the cliffs: Participants who put all their money in a target date/lifestyle fund earned an average of 7.2%. Those who self directed earned an average of 5.3%. This was over the period of 1997-2006. The findings are listed in the article.

News Details - John Hancock

 

[moddestmike]

2 things:

1. Past performance is NOT a predictor of future results. There is a reason every fund company plasters that warning on all their materials. There are no good (reliable) predictors of future results - sorry to spoil the fun.

2. Please read this study before you attempt to self direct your account. It is a little technical, so here are the cliffs: Participants who put all their money in a target date/lifestyle fund earned an average of 7.2%. Those who self directed earned an average of 5.3%. This was over the period of 1997-2006. The findings are listed in the article.

News Details - John Hancock

Well DWS Scudder is the portfolio manager of my 401k. Are you suggesting I consult with them. If I'm not mistaken the Stable Value Trust is what is initially suggested.

 

[JPD5801]

Well DWS Scudder is the portfolio manager of my 401k. Are you suggesting I consult with them. If I'm not mistaken the Stable Value Trust is what is initially suggested.

I don't know that you need to talk to Scudder. In my opinion, the target date funds are the best options for the average 401(k) participant - Simply because most people don't have the time/knowledge to manage their own portfolios. Target date funds offer a professionally managed option at a relatively low cost.

And no, I don't sell target date funds!

 

[soccerman002]

I have all of my 401(k) funds in a 2040 Fidelity target date fund, been doing solid thus far.

I'd go with the recommendation of others, including myself, go with a target date fund if you don't have the time to mess around with it. You can set it, forget it, and get good results long term.

 

[vertcobra99]

I have all of my 401(k) funds in a 2040 Fidelity target date fund, been doing solid thus far.

I'd go with the recommendation of others, including myself, go with a target date fund if you don't have the time to mess around with it. You can set it, forget it, and get good results long term.

First of all how old are you?

Second... those target retirement funds are junk. They are for people that don't know what they are doing.

Third... from the options you listed... I would do the following assuming your a young guy

10% PIMCO total return fund. This fund invests in high quality bonds with no more then 10% involved in junk bonds... they came into some recent troble during the recession but that has passed and I think they will do well in the future.


20% davis new york venture fund. They routeinly out perform the S&P index


20% Aston/Montag & Caldwell Growth Fund - Class N - this invests in common stocks and convertable securities... the risk is high... but you should take lots of risk when your young.


20 % Prudential Jennison Mid-Cap Growth Fund*-*Class A - This Fund seeks long term capital appreciation by investing in the stocks of attractively priced mid size companies that can generate above average earnings growth. Prudential is also one of the largest money managers in the world.

30% - American Funds EuroPacific Growth Fund - Class R3 - This invests overseas in emerging markets. and its also a rated by morningstar as 5 stars which is great. This should provide you with long term growth.

If you ask about my qualifications... I am a CFA charter holder and I just finished my MBA. I currently work at a premir boston investment management firm researching equity securities.

The closer you get to retirement you should consider reducing the risk of your portfolito but if you are young your entire portfolo should consist of growth funds.

 

[JPD5801]

They are for people that don't know what they are doing.

Which is probably an accurate description of 95% of those who participate in 401(k) plans.

 

[soccerman002]

Which is probably an accurate description of 95% of those who participate in 401(k) plans.

No shit, which is why I suggested investing in something that is going to automatically reduce risk over time as you approach your retirement age (basically word for word what the econ major in the previous post said in his last sentence). If they're such junk, why are they so popular and have been proven to yield solid results? Yeah, you could probably do better if your background was in finance, or you pay a firm to manage/play with your money. But, for the average joe blow who just wants a decent return on his money and isn't looking to make an absolute fortune and take on all the risk that goes with doing that, just wants to retire comfortably, I think they're fine.

I'm 29 years old and have a B.S. in Civil Engineering, I'm certainly not an idiot.

 

[JDStud6]

I have several accounts....Roth IRA, traditional IRA, and 401k variety. I have my Roth in a 2050 fund, and will probably put my traditional IRA there too. I dont have the time or knowledge of investing to do too much.

JD

 

[vertcobra99]

No shit, which is why I suggested investing in something that is going to automatically reduce risk over time as you approach your retirement age (basically word for word what the econ major in the previous post said in his last sentence). If they're such junk, why are they so popular and have been proven to yield solid results? Yeah, you could probably do better if your background was in finance, or you pay a firm to manage/play with your money. But, for the average joe blow who just wants a decent return on his money and isn't looking to make an absolute fortune and take on all the risk that goes with doing that, just wants to retire comfortably, I think they're fine.

I'm 29 years old and have a B.S. in Civil Engineering, I'm certainly not an idiot.

they are junk because the gains that you are getting could be doubled with a proper investment strategy. These types of accounts have not been around for a long time and are usually managed by new portfolio managers and they also don't have a dedicated investment direction. You are better off reevaluating your portfolio every 5 years. Most companys even offer this service for free.