October 31st, 2014 | La Grand 1520 Financial |
“Sell in May and Stay Away” Words to live and invest by? I don’t know whoever coined the phrase but I did a bit of research and yes this strategy would have worked out for you is you had implemented it over the life of the TSP retirement account. Of course we know past performance does not guarantee future results but there is something here that makes this investor think that just maybe there is something more to the story this time.
There are five funds available in the Thrift Savings Plan.
The C Fund is based on the S&P 500
The F Fund is designed to match the bonds in the Lehman Brothers U. S. Aggregate (LBA) index.
The G Fund invests in short-term U. S. treasuries
The S Fund follows the Wilshire 4500 index
The I Fund follows the EAFE index
From its inception in 1988 through the end of 2005 the C Fund (based on the S&P 500) has averaged 12. 61556% per year. In the months October through May it averaged12. 87611%. From June through September it averaged -0. 26056%. For the same 18 yr period, the F Fund averaged 3. 356111% for the four months June through September. Had you sold all of your stock C Fund on May 31 and moved all your money into the F Fund and then moved all of your money from the F Fund back to the C Fund on September 30th, you would have realized a 3. 616667% per yr increase in your rate of return over 18 years. Let me repeat this, a 3. 616667% annual increase based on only two trades per year.
From 2001 through 2005 the C Fund (based on the S&P 500) annual average was only 2. 22%. Its average gain October through May was 9. 24% while it’s June through September average was an appalling 7. 02% loss. Utilizing the same strategy as above, our average rate of return would have jumped from an anemic 2. 22% to a healthy 11. 38%. That is an amazing increase of over 9% based on just two trades per year.
Since its inception in 2001 the S Fund (based on the Wilshire 4500 index) has averaged 9. 314% and the I Fund (based on the EAFE index) averaged 6. 56%. They show the same pattern of gains October through May, with gains of 14. 05% for the S Fund and 10. 368% for the I Fund annually during those eight months. They also continue the S Fund pattern of losses Jun through September, a 4. 736% loss for the S Fund and 3. 808% loss for the I Fund. Using the same strategy of eight months in the S and I funds and four months in the F Funds, you would have realized additional gains of 6. 336% for the S Fund and 5. 378% for the I fund brining your rate of return to 15. 65% for an S+F strategy and 11. 938% for an I+F strategy.
What do you think about this? Join the TSPcenter forum and let me know. My gut tells me we are in for a bad summer. Of course that could be a result of the pepperoni pizza I just ate.
Brought to you by Warren Buffett giving an interview on the practices he uses for investing in penny stocks. To receive penny. . .
October 30th, 2014 | La Grand 1520 Financial |
These days when you step into a car showroom, there will be two major things that the dealer will be offering you. First he will be offering you cars, and secondly he will be offering you finance packages. This is how you should look at it. The fact of the matter is you may probably would not buy a car from your bank, even if they started offering them, so you may wish to apply the same scrutiny to the finance packages available at the car dealership and choose to buy only you car there and the finance package elsewhere.
It may be that there is nothing wrong with the finance being offered at the car dealership and in many cases this will be true. However, you must be aware that just because you buy your car there, does not in any way imply that you have to use the finance options and terms that they are offering. You are always free to take a loan from somewhere else, such as a bank, and pay for the car outright, and then simply make the loan repayments to the bank as with any other loan.
You should be careful to find out exactly how much you are being charged for car finance. The primary way to calculate the charge of any credit is by using the APR or annual percentage rate. This calculates the cost of the loan using a standardised formula and all lenders must use the same method of calculation. However, just because a car dealer’s APR looks attractive does not mean your search is over. You should also, always find out how much the car would cost if you paid in cash. Remember that providing a cash discount is exactly the same as charging extra for credit. If the cash price is lower, then you may be better off getting the loan from elsewhere and paying for the car with cash, this will take advantage of the better price and you will have a smaller amount to pay back to your lender.
The other thing you should look out for is down payments and closing payments. These are payments that are paid at the beginning or end of the term of the loan, and while the monthly payment terms may be attractive, it could well be the case that there are large additional payments to make and you should not forget to calculate these in when pricing the finance.
Car finance can be almost as important as the deal you get on the car itself and you should always regard getting a good deal on the financing as part of the process of getting a new car.
October 29th, 2014 | La Grand 1520 Financial |
One unexpected expense and all the budget comes crumbling down. It is not the same again. With having a personal battle mostly all mo to stay on budget people resort to credit cards to purchase excesses. In case you are one of them, you realize there comes a time when it is not ideally suited to serve your purpose. Instant loans are meant to particularly provide for situations which want instant response in financial terms.
Broken car, sick child, home repairs, death – many things in life are known for their unexpected entries. Financial institutions and banks extend instant loans to anyone who is struggling with unexpected financial emergencies. Online financial lenders have made it easier to borrow money as instant loans by making process convenient and accessible to mostly all individual.
Instant loans have few conditions for approval. Besides your name and contact information, the details of your employment. You must be in regular employment with regular income. This will support your goodwill in the instant loans market. You must have a current, valid bank account. They may also ask for bank statements and particulars of other loans and debts.
Instant loans process is simple. It requires the borrower to fill in an application form which will require your income and contact details. The decisions for instant loans are made instantly – within few minutes and the money transferred to your bank account the very same day. Now instant loans companies are working round the clock so you don’t have to worry about not getting money during weekends.
Repayment of instant loans loan, by the traditional method, is through a postdated check which the lender holds until due date. Online instant loans companies will automatically deduct the amount from you bank account and you will be informed before and after.
Repayment term is, of course, short. Loan term for instant loans mostly vary from 14-18 days. The borrower has to work out a repayment plan which he can freely do in collaboration with the loan lender. The loan lender will notify a few days before the due date. If due to any reason you think you can make the payments on the due date, you can extend the loan term. Make sure that you have directed the funds. And before you decide on extending term for instant loans remember that the cost will be high. Try to payback instant loans on time.
Instant loans mostly entail no credit check. This is one of the biggest advantages of this loan type. The borrower will not be penalized for having bad credit rating and will be treated equally as any regular borrower. Bad credit borrowers have encountered success while borrowing instant loans. However multiple bankruptcies or filed for bankruptcy within last yr – might be unacceptable.
Interest rates on instant loans are high. You will have to search far and wide in order to find the right loan lender. Since instant loans create considerable risk for lenders, high interest rates tend to redirect the risk. The choices are many therefore making the choice become more difficult. Different loan lenders have their own system while providing instant loans. Take quote and compare before making the final decision.
Loan amount for instant loans start as low as