The Full Motley: 2Q 2009, Part 2

I just submitted my new allocation, and it was funny because I went against my instincts, but at the same time, I felt better for it because half of my contributions are already going to Fund 84, so it was only 5% going to this fund in question and I think my instincts might be wrong.  This fund is the Total Int'l Stock Index Fund (Fund 113) but I think the Nikkei is outpacing the Dow and I've heard China has epic growth opportunities, so 5% won't make too much of a difference either way, and it is worth the risk to have this exposure.

Below are my future allocations for the next three months, followed by what I have earmarked for my allocations three months from now:

Fund 29 - 0% / 5%
Fund 84 - 55% / 10%
Fund 24 - 15% / 25%
Fund 113 - 5% / 10%
Fund 85 - 25% / 50%

Additionally, I moved some money from Fund 84 to try out another bond fund: GNMA, aka Fund 36.  This won't affect my overall allocation because they're both bond funds, and I moved an even amount, so I can keep a lazy eye on it.  I am basically giving it a try-out potentially to replace my exposure in Fund 29 (Hi-Yield).

As mentioned above, no new money is going to Fund 29 and depending how Fund 36 performs in the next three months, I may redirect the expected 5% earmarked for Fund 29 into Fund 36.

One fund that I have not discussed yet is Vanguard Explorer fund (Fund 24) which is a high-risk fund.  I don't expect high-risk, aggressive stocks to perform better than the blue chips during the rebound, but once the market has topped 10,000, then I think that opportunity exists, so if the market recovery outpaces my expectations, I have 15% (or 25% for third quarter) going to the fund to hedge against my expectations.



DISCLAIMER: Please remember that I am neither licensed nor permitted to give specific advice, so if you want investment recommendations, then please consult with a financial advisor or reputable financial sources; my favorite website is CNNFN.com and my favorite radio station is KFNN 1510 AM "Radio That Makes You Money." The investment decisions presented above were tailored to my risk-tolerance and my financial goals. Many financial plans are at no cost to you (advisers are often paid by the investments where your money is placed).

The Full Motley: 2Q 2009, Part 1

This weekend is 5/10, which is when I make the changes in my portfolio allocations.  Unfortunately, I have learned that I made a mis-step in allocating money to the Vanguard Hi-Yield Corporate Fund because it has a 1% fee on shares sold in less than 1 year, and those bonds really reflect the nature of stocks more than bonds, so they don't capture the real diversification that I want when I establish my automatic rebalancing.  I still like the idea of bonds at 10% of the portfolio, but there are several subclasses for stock to mix up the remaining 90% (of course, like I indicated previously, I will direct 50% to Fund 84 and the other half will be a reflection of my overall target allocation mix in three more months).

Once I make the change, I will show my new allocations here, but I know I have notes at Amy's place on what I was planning to do, so I can review those to increase my comfort level with what I want to do over the next three months and what I think will happen until August.

Amazingly, the market closed above 8,500 today (up 2% today), which is a phenomenal rebound -- almost, too phenomenal since there was nothing to indicate that "everything" is on the right track for a quick recovery.  This rebound may be somewhat superficial (or artificial) but the market free-fall was very much unwarranted, so I don't expect it to take long to get back over 10,000, but I was thinking it would be around the turn of the year -- not a couple months from now.