401,K which Funds to Choose

capnjim01

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My wife has 6 funds to choose from for her 401K can anyone tell me where to look for information on which ones to choose
 
This falls under the category of investment advice. Such advice should only be dispensed by those who are licensed in your state with a series 7 &/or 65 as allocations should be based on time horizon, investment experience, risk tolerance, etc.

If you want research on modern portfolio theory on your different funds, I'd look at Google Finance and search by the ticker symbol and compare alpha, beta, sharpe, traynor, R2, and standard deviation metrics over a 1, 3, 5, and 10 year time period.

https://www.google.com/finance

Many libraries may also have access to Morningstar reports and that would be another good place to get information.
 
I took a much simpler approach when I had a 401(k) with limited fund choices.

I just looked at the NAV changes for the prior 3 and 6 months and spread my money among the funds with the best performance.

We could re-allocate once a month. I would look at the updated NAV changes, see the trends and change the fund allocation accordingly.

If the funds were starting to take a dump I'd go into cash for a while until the next uptrend.

I did OK over a 7 year period before I retired.

Doesn't have to be rocket science.
 
Anyone can give their opinion about funds. It is not illegal to do so in any way shape or form.

However, if someone is Securities Licensed, then they are restricted on the extent they may give their opinion about funds publicly.

But everyone else, as long as they do not hold themselves out to be Securities Licensed, can give their opinion all day long.

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Both Warren Buffet and Jim Cramer suggest that an ordinary person should be invested in just a few index funds such as the S&P 500, Dow, Nasdaq, and maybe a Bond Fund.

Buffet is a big proponent of the average consumer buying just the S&P 500 and holding until 5 years before retirement.

I would second their advice for the most part.
 
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Something to consider.

Many 401Ks now have target date funds. Typically in 5 year bands. If you want a purely, fire and forget, never have to rebalance, never have to think about it again, that is an option. Just go for the nearest one, closer in time if more conservative and further out if more aggressive.

In fact, many companies will put you in the target date fund by default if you don't do anything.
 
Something to consider.

Many 401Ks now have target date funds. Typically in 5 year bands. If you want a purely, fire and forget, never have to rebalance, never have to think about it again, that is an option. Just go for the nearest one, closer in time if more conservative and further out if more aggressive.

In fact, many companies will put you in the target date fund by default if you don't do anything.

This is a great suggestion as well.

If the Plan does not have Target Date Funds, it likely has a couple of "Risk Based" Funds instead. They would say something like "Moderate" "Conservative" "Aggressive" "Moderately Aggressive" etc.

Those are easy ways to have a portfolio tailored to your comfort level.
 
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