[Pesqueeb]

I have a fairly large portion (25%)of my 401k in Janus Overseas. Its been going like a raped ape for a while now(86% in the last year) but with things taking a turn in Europe (Greece I'm looking at you) I'm wondering if its time to move that 25 percent to another fund. Is this a good idea? What would you recommend? Am I just (un?)educated enough to be dangerous to myself? Should I be doing more? I am still many years away from retirement (I'm 31) but I've got enough in it now to be nervous about taking big losses.

 

[dante]

******NOT A FINANCIAL ADVISOR OR EVEN A FINANCIAL PROFESSIONAL********

(This is how I'd look at it if I were going to invest)

Morningstar.com

So going off of morningstar, I'd say:

1) The top 5 companies it's holding are Li & Fung (huh? HK company), Reliance Industries (India), Delta (US/worldwide), Ford (US/worldwide) and Bank of America.
2) It's geographic breakdown of holdings is:
North America: 29%
UK/Western Europe: 21%
Japan: 6%
Latin America: 8%
Asia ex-Japan: 34%
Other:3%
3) It's overweight in Financial and Business Services, and underweight in Consumer Goods and Industrial Materials
4) It has a 5 star rating and a manager who has been on board almost 10 years.
5) Its high risk and high return relative to it's category

So based on that, I wouldn't think that it necessarily has a lot of Greece/Spain exposure. I'd bet that the returns in the past year have been mostly due to focusing on Asia (still hot) and financials (buy at your own risk). Since it's only 25% of your portfolio I'd guess that it all depends on whatever else you have in it. If the rest of your holdings are Euro-Pacific Rim, well you might want to adjust so you have a more balanced portfolio. If you're holding 25% in a total bond market fund, and 50% in a variety of domestic stock mutual funds, you're probably pretty good. Your ratio of foreign & domestic stocks, bonds, precious metals, REITs, cash etc is totally up to you based on your personal needs and risk level. If you have 45 years left to retire and can mentally handle the risk of investments going down, definitely go with a more stock-heavy or risky portfolio. If you have 10 years left to retire or can't stand the thought of your 401k going down 10, 30, 50%, go for a more balanced portfolio with a greater emphasis on bonds (corporate, US government, foreign government) or even cash/CDs (if offered).

Other things you *might* want to look into would be REITs (like BPT, an oil/gas REIT in Alaska) or other higher-taxed securities, since your taxes are deferred on them anyway. Doubt you could actually buy them in a 401k, but might make sense for an IRA at some point.

So basically, no clue. It seems like a worthwhile fund, and if your primary concern is Greece then I think you might be worrying unnecessarily. Beyond that, pick a number and spin the wheel.

edit: Before Joker kills me on the bond recommendation, I'm talking about funds like VBMFX and FSICX which have a mixture of corporate, governmental and mortgage pass-through (government backed) bonds. Yes, if we go through a period of hyper-Zimbabwe-style-inflation bonds will be worth almost nothing, but having an adequate ratio of stocks/bonds/etc will hopefully lessen losses in any one particular area. FSICX is only 23% US Gov't/Agency bonds and VBMFX is a little higher, ~35%.

 

[Pesqueeb]

Thank you, that was basically all the info I was looking for. Unless I missed it, the prospectus does not contain that geographic break down. Had I know that I probably would have been so worried. I guess what I was really interested in was how to get more detailed info. Thanks for the morningstar link. I'm probably being paranoid anyway, I invest pretty conservatively, just having the over seas fund was kind of a stretch for me.

*edit. The more I learn the more I realize how much I don't know. Is there a college level class I can take somewhere? Investing for dummies?

 

[dante]

(hint: click the link in my first post, it goes to the Morningstar report on JAOSX. Then click along the top where you see Quote, Chart, Performance, Ratings and Risk, Management, Portfolio, Expenses, etc. Most of the information that I shared was either in the Quote or Portfolio tabs. If you really want to drill down into it more, you can sign up for their 2 week free trial and get the in-depth reports on the fund as well)

And no, HS would rather you learn algebra as opposed to something that would be practical and useful in your everyday life. Not sure, maybe someone can offer up some books on 401ks and investing? In the end I usually have a relatively lazy portfolio management style, since especially in this past cycle EVERYTHING as far as stocks went down. If you check the graph of international stocks, large caps, small caps, etc, they all followed almost the exact same trajectory. About the only thing that didn't was super-safe bond funds and precious metals, but even they have gotten hit lately. So I just try to stay diversified, and if I think we've gone too high or too low I'll shift funds between conservative and risky funds. But other than that it's just a buy and hold strategy, since I have ~35 years since I'm going to be needing this anyway...

 

[stoney]

I need to login to the system for work tomorrow. I'll see if I can get a holdings list as of last filing, and a Fund Drift report to show whether they are moving away from Europe or to, and into what countries.

As for bond funds, I have been getting more focused onto equity, so I have not been following the FI mkt. My lower risk capital is sitting in Pimco Total Return. It has pretty high fees, but I trust Bill Gross not to f* things in the fixed market. I also like that he is diversifying out of USD denominated bonds (inclu treasuries).

As for learning more, pick up a used set of CFA books form 2008-2009. They are a 6 book series that is equivalent to your first year of business school. Also use investopedia for definitions where needed. I have been trying to get through my CFA, and when I have time to read I am regularly learning new information. Also try to follow major trends outside of CNBC, WSJ, etc. Get research where you can. I like John Mauldin for his economic/macro level look. Zerohedge is good as a counter-balance to CNBC. IF you can make it through, read 'Security Analysis' and 'Intelligent Investor' by Graham, and 'Fixed Income Analysis' by Fibozzi.

 

[stoney]

Ok, had some time. Janus overseas is made up of primarily international names, but has 12/84 names being US companies. The majority of returns (assuming 1 yr time frame came from intl names, but three of the top ten, including the top name UAUA are US companies.

Given the intl equity markets are blowing up, I'd roll it to mmkt (janus if possible to reduce fees) and wait to put it into something else. Risk assets are very over priced and those prices are coming back to earth fast.

 

[Pesqueeb]

Well, don't know if it was smart or not but I got nervous enough over the weekend to take the 25% out of Janus and put it in Treasuries (or at least as much as I could inside a 401k). Guess I'll see how it pans out. As for not putting it in a money market, the Wife and I already have a fair amount in a personal MM so I didn't think duplicating it in my 401k really made much sense. I figure if this turns out to be too much of a stupid move I'll put it all back in Janus, close my eyes, and quit fvcking around with it. I've got plenty of time so maybe it makes more sense to just be hands off. Thanks for the education, links, and book recomendations, I've been doing a ton of reading on teh webz since its been slow at work. My brain is starting to fry but I'm enjoying it. I might be in the wrong line of work.

 

[stoney]

The thing with going out of a fund family, is that they ding you for leaving before you're "vested" with them. Trying to stay in fund will help keep those costs down. I think treasuries will run short term, but I noted MMkt because when the mkt turns against treasuries, you mmkt is "good as cash" for investing otherwise.

 

[Pesqueeb]

The thing with going out of a fund family, is that they ding you for leaving before you're "vested" with them. Trying to stay in fund will help keep those costs down. I think treasuries will run short term, but I noted MMkt because when the mkt turns against treasuries, you mmkt is "good as cash" for investing otherwise.

Yea, I was a little confused about this. All of the discussed funds exist within my 401k through work managed by Wells Fargo (as I understand it). According to Wells Fargo there is a fee:

IMPORTANT: Most mutual fund companies encourage investing for the long-term, and as a result may have implemented frequent trading policies. This means that restrictions may be placed on your transaction to avoid short-term trading and market timing. These policies include but are not limited to charging redemption fees, blocking a purchase transaction or rejecting your trade. If your trade is rejected, you will be notified by mail.
<snip>
Redemption Fees - Redemption fees are charged by mutual fund companies for certain redemption transactions, and are based on the length of time shares have been in a fund. The amount of the fee is calculated based on the value of shares removed from the fund, how long they have been held there, and the redemption fee percentage rate charged by the fund.
<snip>
Q: Will I be charged a redemption fee if I realign my existing balance?
A: Yes, if the shares redeemed are not held longer than the minimum holding period or are not exempt from redemption fees. Consult the fund's prospectus for details regarding purchases that are exempt from redemption fees.

Now the way I read this is that the redemtion fee is only applicable if you move money within the short side of a certian time line. In the case of JAOSX, the "holding period" is 90 days. I've had my 25% in there way longer than 90 days. I assumed that I would not have to pay the fee in this case, is that incorrect? Either way, the fee is 2 percent, I figure if JAOSX goes down more than 2% the move paid for itself should I opt back in. Near as I can tell the VFIUX doesn't even have a redemtion fee as it does not appear in teh list of funds that have fees. I realize its perfectly possible I'm wrong but thats how I read the tea leaves. Am I correct on this?

 

[stoney]

let me look into it tonight.