Top Plans for Brokerages
Vanguard ETF: 7.4%*
Diversified Core: 8.1%*
Six Core Asset ETFs: 7.3%*
*:5 Yr Annualized Return of TAA Moderate Portfolio

...More Plans...

Articles on SPX

First   1   2   Last  

  • The Goldman Sachs 401(k) Plan Report On 06/03/2011

    06/03/2011

    Retirement investing is a long term process. This report reviews The Goldman Sachs 401(k) Plan . We will discuss the investment choices and present the plan rating by MyPlanIQ. Current economic and market conditions are discussed in the context of the investment portfolios in the plan. We will then show how investors in The Goldman Sachs 401(k) Plan can achieve reasonable investment results using asset allocation strategies.

    Plan Review and Rating

    As one of the largest investment banks in the world, Goldman Sachs (GS) does give its employees ample diversification opportunities. The plan consists of 36 funds. These funds enable participants to gain exposure to 6 major assets: US Equity, Foreign Equity, Commodity, Emerging Market Equity, REITs, Fixed Income.

    As of Jun 2, 2011, this plan investment choice is rated as average based on MyPlanIQ Plan Rating methodology that measures the effectiveness of a plan's available investment funds. It has the following detailed ratings:

    Diversification -- Rated as great (100%)
    Fund Quality -- Rated as below average (14%)
    Portfolio Building -- Rated as average (52%)
    Overall Rating: average (55%)

    It is a bit surprising that the plan's fund quality is rated below average. In the plan, other than the low cost index funds, it provides many Goldman Sachs funds such as Goldman Sachs Asset Management L.P./Structured US Equity Fund (GSELX). This could possibly help your own fund business with the expense of lower qualities. We don't know what cost the plan is charged for these funds. 

    Current Economic and Market Conditions

    As we are clearly entering a seasonally weak period for risk assets, global economies have clearly slowed down. Recently released Case-Shiller housing index showed that the U.S. is now in a double dip state for housing prices. Unemployment rate has been stuck at 9% level. Additional indicators such as conference board consumer confidence index and Chicago ISM index are all pointing to a slow down in the summer season.

    Amid a string of bad economic news, risk assets have come down a bit, though they are still ranked high at the moment. Long term treasury bonds, however, have shot up in the anticipation of weakened economy. The following table shows the major asset class ranking in terms of their momentum.


    Assets Class Symbols 05/27
    Trend
    Score
    05/20
    Trend
    Score
    Direction
    International REITs RWX 11.77% 10.82% ^
    Commodities DBC 10.84% 10.32% ^
    US Equity REITs VNQ 10.77% 10.41% ^
    Gold GLD 9.42% 10.06% v
    Emerging Market Stks VWO 8.56% 6.72% ^
    US Stocks VTI 8.29% 8.23% ^
    International Developed Stks EFA 6.77% 5.23% ^
    US High Yield Bonds JNK 6.37% 6.37% v
    International Treasury Bonds BWX 5.96% 4.66% ^
    Frontier Market Stks FRN 4.05% 4.27% v
    Emerging Mkt Bonds PCY 3.57% 4.27% v
    Intermediate Treasuries IEF 2.71% 2.39% ^
    US Credit Bonds CFT 2.5% 2.81% v
    Municipal Bonds MUB 2.13% 2.0% ^
    Total US Bonds BND 1.99% 1.92% ^
    Mortgage Back Bonds MBB 1.75% 1.8% v
    Treasury Bills SHV 0.07% 0.02% ^     


    Portfolio Discussions

    The chart and table below show the historical performance of moderate model portfolios employing strategic and tactical asset allocation strategies. For comparison purpose, we also include the moderate model portfolios of a typical 6 asset SIB (Simpler Is Better) plan . This SIB plan has the following candidate index funds and their ETFs equivalent:

    US Equity: SPY or VTI
    Foreign Equity: EFA or VEU
    Commodity: DBC
    Emerging Market Equity: EEM or VWO
    REITs: IYR or VNQ or ICF
    Fixed Income: AGG or BND

    Performance chart (as of Jun 2, 2011)

    Performance table (as of Jun 2, 2011)

    From the above table, one can see that the plan is comparable with six core asset benchmark. 

    To summarize, participants in The Goldman Sachs 401(k) Plan can achieve very reasonable investment returns by adopting asset allocation strategies that are tailored to their risk profiles. This plan provides adquate diversification but can be improved by working on fund qualities. 

    Symbols:GS, ^RUT, MLM, VTI, VEU, VWO, VNQ, DBC, BND, STLEX, SVSPX, VUSTX, VIGIX, VIVIX, VIMSX, SSEMX, VIPSX, STLAX, STLBX, WFBIX, STLCX, STLDX, STLFX, GMCFX, GSTGX, WACPX, GSELX, GCMAX, GSHTX, GSCGX, GSLAX, GSFIX, GGOIX, GREIX, QRAAX, PIGLX, SVRIX

    Exchange Tickers: (GS), (^RUT), (CASH), (MLM), (VTI), (VEU), (VWO), (VNQ), (DBC), (BND), (STLEX), (SVSPX), (VUSTX), (VIGIX), (VIVIX), (VIMSX), (SSEMX), (VIPSX), (STLAX), (STLBX), (WFBIX), (STLCX), (STLDX), (STLFX), (GMCFX), (GSTGX), (WACPX), (GSELX), (GCMAX), (GSHTX), (GSCGX), (GSLAX), (GSFIX), (GGOIX), (GREIX), (QRAAX), (PIGLX), (SVRIX)

Members enjoy Free features

  • Customize and follow a diversified strategic allocation portfolio for your 401k, IRA and brokerage investments within minutes
  • Receive monthly or quarterly re-balance emails
  • Enter funds and percentages in your portfolio, see its historical performance and receive ongoing rebalance emails
  • Real time fund ranking and selection for your plans
  • Quality retirement investing newsletter emails
  • Fund ranking and selection for your plans

Tens of thousands of users have signed up!

Join Now (Free)
No Credit Card Required

User names can only consist of alphabetic and
numeric characters.(eg: 0-9a-zA-Z)
I agree to the Terms of use

Login With Facebook:

Get Started Now. It's Free!

Get portfolio suggestions for your
401k plan or brokerage accounts

Powered by MyPlanIQ
You have created an account on MyPlanIQ.com by using this email "", please login MyPlanIQ account or reset your password.