First an administrative note. I moved the blog to a new web hosting provider last weekend. If you haven’t noticed anything different, great. It’s supposed to be transparent, except I hope the website will run a little faster. If you do notice something not working right, please drop me a note.
Now interesting the articles I read this week:
Busting the Sell in May and Go Away Myth by Rick Ferri at RickFerri.com
Unfortunately the myth busters made the horrible mistake of comparing the Sell in May strategy with 100% in stocks. Suppose you normally invest a balanced portfolio of 60% in stocks and 40% in bonds. With Sell in May you invest 100% in stocks from November to April, and 20% in stocks plus 80% in bonds from May to October. That would be a fair comparison because over the entire year you still average 60% in stocks and 40% in bonds.
Then we know what they say about past performance. Because you can only study the past, whatever study can’t prove anything one way or the other for the future.
Rick Ferri: Own Stocks To Offset Low Rates by Olly Ludwig at IndexUniverse.com
Olly interviews Rick Ferri.
“So the idea of moving to fixed income as you get to retirement is going to be based more on how much money you have and what kind of a financial position you’re in rather than whether you can handle the risk.”
That’s letting need to take risk drive it instead of letting the ability or willingness to take risk drive it. Food for thought.
Why I’m selling stocks by Allan Roth at CBS MoneyWatch
I’m not selling because I’m still accumulating. If I sell now I will likely buy more in the future at higher prices.
Is My Emergency Fund Too Big? by Mike Piper at Oblivious Investor
It’s not too big if you just treat it as fixed income investment. Pretty tax efficient too at low yields.
Strategies For Existing Variable Annuities With GLWB Or GMIB Riders by Michael Kitces at Nerd’s Eye View
It’s more complicated than I can understand but my takeaway is that after a sunk cost is already paid, what’s left can still be quite good.
Bad day for TIPS, worse day for the Federal Reserve by David Enna at TIPS Watch
David is on to something in his concluding paragraph. Something weird is happening.
Obama’s budget: Why your toddler needs a job by Kathy Kristof at CBS MoneyWatch
I agree with what she wrote.
Girl Scout Cookies as a Tax Deduction by Ann Carrns at New York Times Bucks Blog
We really should get out of the mentality that everything we do must come with a tax deduction. If you want to support the girl scouts, support them. If you want to send your kids to college, send them. If you want to save for retirement, save for retirement.
Retirement: The married/single divide by Steve Utkus at Vanguard Blog
I’m married. It helps a lot.
Can Internet Banks and Financial Services Replace the Megabanks? by Ken Tumin at DepositAccounts.com
No, because people want the services offered by mega-banks. Just go a bank branch and see what people are doing there.