Sorry to hear about the poor fund performances. I've never bought a mutual fund but have dabbled with ETFs, and your posting confirms my belief to not invest into a mutual fund.
Corey, I read your blog every time you publish and I like what you have to say. The following you already know, but I will say it just so you hear it from someone else. Stop paying those money managers. They are guessing just like everyone else. They have rules about what they can do with your money. Take all your current mutual fund money and put it into low cost index funds (Vanguard for instance), and just let it ride. This is your long-term money, the 20-30 year money, and since the historical trend over the last 100 years is up, there is no reason to think it won't continue that way. With long term money you are not trying to hit home runs. You just want to bat .300 every year. I love ETF's as you described, but, like you, I have a need for short term action and it is too easy to sell the ETF's you may use for your long-term investments. In a market correction, you would be tempted to sell those ETF's and then you would become a market timer with your long-term money. We both know that there are no (maybe one or two) successful long-term market timers. With your short-term money you can keep day or swing trading and add profits. You have the correct program mapped out. Just blow those "guru" money managers away, and think hard about whether ETF's or their equivalent mutual fund index would be best for you considering your self-admitted short term impulses (perfectly normal, I think most people would act the same way if they could trade mutual funds like stocks). Keep on informing us with your great blog, and have an extremely successful investing and trading year in 2008.
Corey Rosenbloom
· 1 year ago
Thank you Reno and John for your comments.
I will definitely be selling the funds in favor of ETFs, but I must promise myself not to trade them, as they are meant to be long-term investments. It's true that mutual funds sometimes outperform stock indexes, but I would rather sacrifice those "sometime" gains for certain market performance, so that I will be ensured never to under perform, and I also will be insured against paying management fees.
I will take your comments to heart, and very much appreciate them as well as your support.
Happy New Year Corey!!! I hope you had a great one!
I have been wondering what I should do with my long term money. I often get tempted to just trade in them. I have heard of people trading conservative options plays like covered calls or even spreads in their retirements accounts as a diversification. I thought it was an interesting idea but don't know if I would have the power to just limit it to those strategies only.
Talk to you later! BTW... I may take the plunge and start the blog soon!
Mark F.
· 1 year ago
excellent analysis as always, if you want some info on international etfs i recently took a look at them . . . i can send a link if you would like. best of luck with you investing in the new year, keep up the outstanding work.
All Comments
Also here's an interesting article on why mutual funds are a scam and to invest into a bag of ETFs: http://www.sanfran.com/content_areas/home/view_...
I read your blog every time you publish and I like what you have to say. The following
you already know, but I will say it just so you hear it from someone else. Stop
paying those money managers. They are guessing just like everyone else. They have
rules about what they can do with your money. Take all your current mutual fund
money and put it into low cost index funds (Vanguard for instance), and just let it
ride. This is your long-term money, the 20-30 year money, and since the historical
trend over the last 100 years is up, there is no reason to think it won't continue
that way. With long term money you are not trying to hit home runs. You just want
to bat .300 every year. I love ETF's as you described, but, like you, I have a need
for short term action and it is too easy to sell the ETF's you may use for your
long-term investments. In a market correction, you would be tempted to sell those
ETF's and then you would become a market timer with your long-term money. We both
know that there are no (maybe one or two) successful long-term market timers. With
your short-term money you can keep day or swing trading and add profits. You have
the correct program mapped out. Just blow those "guru" money managers away, and
think hard about whether ETF's or their equivalent mutual fund index would be best
for you considering your self-admitted short term impulses (perfectly normal, I think
most people would act the same way if they could trade mutual funds like stocks).
Keep on informing us with your great blog, and have an extremely successful investing
and trading year in 2008.
I will definitely be selling the funds in favor of ETFs, but I must promise myself not to trade them, as they are meant to be long-term investments.
It's true that mutual funds sometimes outperform stock indexes, but I would rather sacrifice those "sometime" gains for certain market performance, so that I will be ensured never to under perform, and I also will be insured against paying management fees.
I will take your comments to heart, and very much appreciate them as well as your support.
Corey
Cheers! Here's to a fabulous New Year! xoxo
I have been wondering what I should do with my long term money. I often get tempted to just trade in them. I have heard of people trading conservative options plays like covered calls or even spreads in their retirements accounts as a diversification. I thought it was an interesting idea but don't know if I would have the power to just limit it to those strategies only.
Talk to you later! BTW... I may take the plunge and start the blog soon!
mark