Thursday, January 7, 2010

Two Portfolios - Performance

2009 Performance:

  1. IRA:     25.9% gain.
  2. 401k:    43.3% gain

Explanation: For most of 2009, the IRA had a roughly 60/40 allocation to stocks/bonds. In contrast, the 401k was a very small fixed income percentage. Furthermore, our best fund performer for 2009 was the American Funds Europacific Growth Fund.

Bottom line: the risky 401k outperformed the IRA in 2009.

Caveat: Because my 401k has limited fixed income options, I will continue to allocate more fixed income investments to the IRA. Combined, I am shooting for a 75/25 equity/fixed income allocation.


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