tyler_cracker and smartalecc5

Thanks for the advice.

The highest EV thing you think I can invest in blindly is a retirement funD ?

It's a way better bet than blindly throwing your money around when you don't know what you're doing. If you want higher risk, then buy the Russell 2000 (IWM). Keep in mind, though, that what you're doing is not investing. It's just fun money that might very well be pissed down the drain.

If you want to invest, then you should creat a broadly diversified portfolio with different asset classes. A retirement fund will do that. And most 2055 funds will be very aggressive. In fact, most people would consider them too aggressive. They're so aggressive because they want to gin up returns to keep up with competitors' claims of returns on similar funds. It's not necessarily good, but that's what they do.

If you have the time to browse your options in your fidelity account, you might as well do the asset allocation yourself. You don't need 10% in bonds.
Weigh heavily towards small cap growth and value, as that is the most +EV space (for mutual/index funds) for your IRA $$$. Fair warning - there WILL be years when you're down a lot. There will be years when you're up a lot. Don't tilt.

I don't understand what you're saying here. It sounds like you're saying tilt toward small cap growth and value, but that you end with "Don't tilt." What are you saying? I don't get it. Also, are you suggesting he do both growth and value? And if so, why not just do a small cap fund, which is basically the growth and value combined? Growth and value then to outpeform each other in a cyclical pattern, so I'm not a big believer in the tilt toward either one and just do a small cap tilt, which covers all my bases.

Anyway, if you do do a small value or small growth tilt, you can also buy those iShares ETFs commission free at Fidelity as well. But I'd just do the small cap myself. Actually, I'd do a fully diversified portfolio with international stocks, domestic stocks, and bonds.

I have Zero aversion to risk
If it busts it busts

Just trying to maximize my EV

I don't want to diversify at all
I'm down to do something risky, that on average will beat the market but will bust once in a while

dale-
i meant "dont tilt" as in "don't panic" when his funds plummet. a small cap blend is fine, since it is a mix of growth and value. I suggested a diversified portfolio with a large weight towards small and mid caps, but if alvl2 doesn't want diversification than the small cap space is most EV. Either way, that is where he should start.

alvl2 - small cap growth and value will boom and bust bigger than "the market". As a long term investment, this space has traditionally been more profitable than "the market", since you're taking on more risk for a greater reward.
if you want a real gamble, think micro caps and the pink sheets (commonly called "penny stocks"), but I start to question how +EV these plays are long-term in an IRA where you can only add 5k/year. The traders on this forum would be better equipped to advise you here than me.

But I say start with Small Cap Blend.

Oof Rome ,

You understood exactly what I was saying and answered accordingly
Thank you ...... And ya I dunno how +EV the penny stocks are either
I guess I'm looking for one step safer than that to be assured of the +EV


Now the newb in me , how do I invest In these small caps ? Examples ? Diversification options ?

IWM. It's iShares' Russell 2000 Index ETF. It's a small cap index fund.

Just for the record, I didn't mean to put that emoticon in my last post...

Any Canadians have advice for the best place for a mid 5 figures amount - have the max contributable for tfsa so first xk would go in there but have been overseas and have just some what ignored it (some in stock market, some earning 3.5% (liquid), too much earning very little in bank). Any investment firms to recommend? What fees are reasonable? Long term is fine.

Bigtime financial noob here looking to get started with investing.

-27 years old
-My 401k is maxxed out (only one year in though) asset mix is like 60% stock, 25% bond, 15% short term reserve.


Now I just started putting more money into mutual funds. i have $5000 in VASIX (80% bond, 20% stock) and another $5000 in VNYTX (long term muni bond/new york).

i thought VNYTX would be a good buy because it's tax exempt and my salary is 160,000 so i get destroyed on taxes being in the bracket that i'm in.

so all in all my current asset mix is like 65% bond, 30% stock, 5% short term reserve

anyway, i know that my current strategy is too risk averse and i should have some more exposure to stock. i dont know much about the stock market but it seems to me like a pullback is coming soon and it just doesnt seem like a good time to buy but what do i know?

i'm probably going to leave the $10,000 in the two funds above, but start dumping most of my paychecks into another fund that you guys suggest.

my risk tolerance is moderate. basically, i hate my job and the 160k salary is barely keeping me from quitting although ill probably be out in a couple of years. im also looking to buy a house sometime within the next few years and dont want to take a beating in the market between now and then.

need more info...you shouldn't really be in the market if you're planning on using the money to buy a house in a few years

Any debt? Rates? Etc

Amount of your 401k? Amount in your taxable accounts? Bonds funds (except munis) are not good for taxable accounts, you should be allocating bonds to your 401k where they're sheltered. Stock index much better in your taxable account. However, it doesn't really sound like you want to lose any of your taxable account, in which case I suggest you look at other options. Need to know more about your situation/tolerance.

my 401k only has 17k in it. i just started contributing this year (my first year working a real full time job).

i have 130k student debt @ ~6.5% but i already decided that i'm not paying it back. i pay the minimum every (basically 1k in interest+ very small principal) month so i don't default but that's it. to an outsider, it would seem that paying down these loans aggressively (and getting a guaranteed return of 6.5%) would be a no-brainer but there's other factors at play here which have convinced me that it's not a good idea to pay these back:

#1- i think there will be some kind of govt bailout for student debt in the next few yrs.

#2- i am eligible for income-based repayment (and when you pay this amount for 20 years your debt is forgiven). when i leave my 160k/yr job i'll probably just play poker and my monthly payment will be like $100. so im better off just saving tons of money now than putting it toward debt.


basically im just looking for a place to put $$$ other than a savings account. even if im only making 3% thats fine, so thats why i figured muni bonds would be a good idea. as stated above, i went with VNYTX and VASIX but really have no idea what im doing.

#1 possibly...IMO, the bailout already occurred though with the 20yr income based repayment forgiveness

2) $100/month? If you're single that means your adjusted gross income is $25,000/yr. You're going to give up $160k/yr law for $25k as a poker player? Live? Online? If you inspire to buy a house, I recommend you do it while you're making bank at a job. Prob gonna be tough to get a house loan with $130+K in school debt as a profession poker player making $25k/yr.

re: risk tolerance, bonds can still lose a significant amount of money. If I told you the market was going down, what % would you be comfortable losing?

BTW #1/2 remind me how much our country is ****ed

If you're looking to stash money away short term, then VNYTX is not a good idea. It has a duration of 6-7 years.

im single so i'm not really looking to buy a crazy insane house. if i do end up going the poker route i'm just gonna buy a 50k-100k condo in vegas in cash (unless mortgage rates get crazy low).

all in all, i have like 50k in the bank, 17k in my 401(k) and 10k in the aforementioned mutual funds.

anyway, dont want to get too off topic.

my risk tolerance is moderate to low. i wouldn't be comfortable losing more than 25% of my investments. i know that bonds arent a slam-dunk but they are certainly safer than stocks, no?


and i agree that this country is ****ed. it's crazy how i'm supposed to be "one of the lucky ones" who "made it" and i consider myself to be in a somewhat ****ty financial situation despite making more than 98% of the population. it's crazy how i envy my high school dropout friends who got city jobs, are halfway to retirement, and have sweet pensions.

great, thanks for this info. is VASIX ok though? ant suggestion on what i should do with the 5k i currently have in VNYTX?

and does your point re VNYTX still stand considering im in the highest tax bracket?

-as mentioned, time frame is really important for bonds

-You're not in a somewhat ****ty financial situation. I'll leave it at that b/c I don't want to derail the thread.

was curious if people have thoughts about fidelity life cycle funds. Looking specifically at the 2025 ones for the parents. No transaction cost since it's a fidelity account.

I think they're great, so long as they meet the desired asset allocation for your parents. Focus on the asset allocation and not the year of their retirement.

I prefer Vanguard for those type of funds since the expense ratio is lower at Vanguard (0.18%) vs (0.73%)

I think Fidelity's Freedom Funds suck. They're better than your parents simply picking random mutual funds to invest in, but they invest in two dozen different Fid funds. I think that's way overkill. More importantly, they charge .55% more per year than Vanguard. That makes a huge difference over the years. If your parents invest $100k now and the pre-expense return was 8% a year, then at Fid they would have an average annual return of 7.27% while at Vanguard it would be 7.82%. At Fidelity they would have $249k in 2025, while at Vanguard they would have $266k. That's not counting any new money they might put in or anything.

Would your parents be comfortable moving their money? I think your parents would be better off transfering to Vanguard and using their 2025 Fund. I actually have my money at Fidelity. I'm not a Fidelity hater or anything, but I use their index funds and iShares ETFs. I wouldn't recommend their actively managed funds. They're just too expensive.

i've been reading about how instead of buying a lifecycle fund, you do a do-it-yourself three-fund portfolio using lower-cost Fidelity funds. You can duplicate a lifecycle fund portfolio by for example

60% Fidelity Spartan Total Market Index Fund (FSTMX) 0.10% ER
25% Fidelity Spartan International Index Fund (FSIIX), 0.10% ER
15% Fidelity U.S. Bond Index Fund (FBIDX), 0.22% ER

this lower ER would be much lower than a .75% ER in a fidelity lifecycle fund

For your parents, it's just going to be easier if you get one target fund. The target funds require no rebalancing, whereas with the three fund you will have to rebalance it for them from time to time.

My preference would be Vanguard Target > Fidelity three funds+lower expense >>>>>>> Lifecycle

Is this all an IRA? Taxable account? How much are they looking to invest? Do they have other accounts (e.g. 401k w/ employers)?

This would be a good solution, if they are able and willing to rebalance regularly. But most people don't keep up with their finances enough and wouldn't do a regular rebalance. That would run the risk of their asset allocation getting majorly out of whack. If they are on top of things and willing to rebalance themselves and stick with it, then what you suggest would work well.

Also, note that 15% bonds is very low for people about 13 years from retirement. Fidelity 2025 actually uses 31-32% bonds, which is still quite aggressive.