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Articles on TWEIX

  • Retirement Income ETFs vs. Income Mutual Funds: An Update

    09/11/2011

    We first compared asset allocation portfolios using dividend ETFs (and bond ETFs) and those using income mutual funds on SeekingAlpha.com Retirement Income Investing: ETFs vs. Mutual Funds more than two months ago. Let's review these two plans: Retirement Income ETFs  and  Schwab Income Mutual Fund Select List.

    Here are the asset classes covered by the two plans:

     

    The list of minor asset classes covered by Retirement Income ETFs The list of minor asset classes covered by Schwab Income Mutual Fund Select List
    Diversified Emerging Mkts: EEM, VWO, DEM
    Emerging Markets Bond: EMB, PCY
    Equity Energy: AMJ
    Foreign Large Value: PID, IDV
    Global Real Estate: RWX
    High Yield Bond: HYG
    Inflation-protected Bond: TIP
    Intermediate Government: IEI
    Intermediate-term Bond: CIU, CORP, MBB
    Large Blend: VIG
    Large Value: DVY, SDY, VYM, FVD
    Long Government: IEF, TLT
    Long-term Bond: LQD, VCLT
    Mid-cap Value: PEY
    Miscellaneous Sector: PFF
    Muni National Long: MUB
    Muni Short: SHM
    Real Estate: IYR, ICF, VNQ
    Short Government: SHY
    Short-term Bond: CSJ, VCSH
    World Bond: BWX, WIP
    Emerging Markets Bond: TGINX
    Foreign Large Blend: SICNX, LISOX
    Foreign Large Value: AAIPX
    High Yield Bond: STHTX, MWHYX
    Inflation-protected Bond: ACITX
    Intermediate Government: SWGSX, CPTNX
    Intermediate-term Bond: SWIIX, SAMFX, PTTDX, PGBOX, MWTRX, FTRFX
    Large Blend: SWANX, TICRX, PRBLX
    Large Growth: SWLSX, JENSX
    Large Value: TWEIX, PQIAX
    Mid-cap Blend: NMMCX
    Mid-cap Value: ARDEX
    Multisector Bond: PONDX
    Muni National Interm: SWNTX, TWTIX, STTBX
    Muni National Long: NOTEX, ACLVX
    Muni Short: FSHIX
    Real Estate: CSRSX
    Short Government: FIGTX
    Short-term Bond: FSTIX, ACSNX
    Ultrashort Bond: SIGVX
    World Bond: PFODX

     

    Asset Class Retirement Income ETFs Schwab Income Mutual Fund Select List
    REITs 4 1
    Fixed Income 19 24
    Sector Fund 2 0
    Foreign Equity 2 3
    Emerging Market Equity 3 0
    US Equity 6 9
    Other 0 0
    Total 36 37

     

    Little in the two plans' investment choice ratings has changed since then.  As of Sep 9, 2011, Retirement Income ETFs investment choice is rated as average and Schwab Income Mutual Fund Select List investment choice is rated as above average based on MyPlanIQ Plan Rating methodology that was designed to measure how effective a plan's available investment funds are . It has the following detailed ratings:

    Attribute Retirement Income ETFs Schwab Income Mutual Fund Select List
    Diversification great (95%) great (85%)
    Fund Quality below average (29%) great (85%)
    Portfolio Building above average (67%) above average (71%)
    Overall Rating average (64%) above average (80%)



    Performance chart (as of Sep 9, 2011)

    Performance table (as of Sep 9, 2011)

    Portfolio Name2011 YTD1Yr AR1Yr Sharpe3Yr AR3Yr Sharpe5Yr AR 5Yr Sharpe
    Retirement Income ETFs Tactical Asset Allocation Moderate 2.49% 8% 80% 11% 84% 10% 71%
    Retirement Income ETFs Strategic Asset Allocation Moderate -1.16% 5% 42% 5% 23% 3% 14%
    Schwab Income Mutual Fund Select List Tactical Asset Allocation Moderate 3% 9% 84% 11% 101% 10% 92%
    Schwab Income Mutual Fund Select List Strategic Asset Allocation Moderate -2.11% 4% 35% 4% 27% 3% 16%

    Refer to detailed portfolio comparison.

    Again, we are seeing income ETFs can still rival the well selected income mutual funds. This is a good news for income investors in their IRA investments or taxable account investments. ETFs have more flexibility and have a well defined and simple indexing strategy (isn't this what MyPlanIQ is also doing?).

    Disclosure:

    MyPlanIQ does not have any business relationship with the company or companies mentioned in this article. It does not set up their retirement plans. The performance data of portfolios mentioned above are obtained through historical simulation and are hypothetical.

    Symbols: SPX, VIG, DVY, SDY, ICF, RWX, HYG, LQD, IEF, TLT, TIP, AMJ, TWEIX, LISOX, CSRSX, PTTDX, Retirement Investments, IRAs, ETF Portfolios, Portfolio Management, Risk Management, Dividend ETFs

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  • Employees in Sprint Nextel Dial up An Average 401K Retirement Plan

    03/22/2011

     

    Sprint Nextel Corporation offers wireless and wireline communications products and services to consumers, businesses, and government users in the United States, Puerto Rico, and the U.S. Virgin Islands. Sprint Nextel was founded in 1899 and is headquartered in Overland Park, Kansas. Recently, AT&T (T) announced its plan to acquire T-Mobile USA, putting enormous pressure to Sprint Nextel, ranked only as a distant the third largest mobile phone service provider in the U.S.

    In this article, we review Sprint Nextel 401K Plan. We will discuss how participants in the plan can achieve reasonable investment results using asset allocation strategies. We will also discuss how those portfolios are positioned in today’s market environment.

    Sprint Nextel 401K Plan's 401K plan consists of 29 funds. These funds enable participants to gain exposure to 4 major assets: US Equity, Foreign Equity, Emerging Market Equity, Fixed Income. Four Core Asset ETF (EM) Benchmark's 401K plan consists of 4 funds. These funds enable participants to gain exposure to 4 major assets: US Equity, Foreign Equity, Emerging Market Equity, Fixed Income.

    The following table lists its fund choices:

    Asset Class Ticker Name
    LARGE VALUE TWEIX American Century Equity Income Inv
    SMALL VALUE DFSVX DFA US Small Cap Value I
    Mid-Cap Growth HAMGX Harbor Mid Cap Growth Instl
    High Yield Bond PHIYX PIMCO High Yield Instl
    WORLD BOND PFUIX PIMCO Foreign Bond
    WORLD STOCK GMGEX GMO Global Equity Allocation III
    SMALL BLEND IWM iShares Russell 2000 Index
    Foreign Large Blend EFA iShares MSCI EAFE Index
    LARGE BLEND SPY SPDR S&P 500
    MID-CAP BLEND MDY SPDR S&P MidCap 400
    Multisector Bond SMARX Brandes Separately Managed Acct Res Tr
    Multisector Bond SMARX Brandes Separately Managed Acct Res Tr
    Intermediate-Term Bond AGG iShares Barclays Aggregate Bond
    ROOT CASH CASH
    DIVERSIFIED EMERGING MKTS EEM iShares MSCI Emerging Markets Index
    Foreign Large Blend VGTSX Vanguard Total Intl Stock Index Inv
    LARGE GROWTH VWUSX Vanguard US Growth Inv
    LARGE VALUE VIVAX Vanguard Value Index Inv
    Target Date Funds
    Northern Trust Corp

     

    The list of minor asset classes covered by Sprint Nextel 401K Plan The list of minor asset classes covered by Four Core Asset ETF (EM) Benchmark
    Diversified Emerging Mkts: EEM, GMM, PXH, DEM, SCHE
    Equity: VTI, VT
    Foreign Large Blend: EFA, VEU, GWL, PFA
    High Yield Bond: HYG, JNK, PHB
    Intermediate-term Bond: AGG, CIU, BIV, BND
    Large Blend: IVV, IYY, IWV, VTI, VV, SPY, DLN, RSP, SCHX
    Large Growth: IVW, IWZ, JKE, VUG, ELG, QQQQ, RPG, SCHG
    Large Value: IVE, IWW, JKF, VTV, ELV, PWV, RPV, SCHV
    Mid-cap Blend: IJH, IWR, JKG, VO, MDY, EMM, PJG, DON, EZM, MVV
    Mid-cap Growth: IJK, IWP, VOT, EMG, PWJ, RFG, UKW
    Multisector Bond: AGG, GBF, BND, LAG
    Small Blend: IJR, IWM, JKJ, VB, DSC, PJM, DES, SAA, UWM, SCHA
    Small Value: IJS, IWN, JKL, VBR, DSV, PWY, RZV, UVT
    World Bond: IGOV, BWX, WIP
    World Stock: IOO, VT
    Diversified Emerging Mkts: EEM, GMM, PXH, DEM, SCHE
    Foreign Large Blend: EFA, VEU, GWL, PFA
    Intermediate-term Bond: AGG, CIU, BIV, BND
    Large Blend: IVV, IYY, IWV, VTI, VV, SPY, DLN, RSP, SCHX

     

    Asset Class Sprint Nextel 401K Plan Four Core Asset ETF (EM) Benchmark
    Fixed Income 5 1
    Sector Fund 0 0
    Foreign Equity 3 1
    Emerging Market Equity 1 1
    US Equity 19 1
    Other 1 0
    Total 29 4

     

    As of Mar 21, 2011, Sprint Nextel 401K Plan investment choice is rated as average and Four Core Asset ETF (EM) Benchmark investment choice is rated as below average based on MyPlanIQ Plan Rating methodology that was designed to measure how effective a plan's available investment funds are . It has the following detailed ratings:

    Attribute Sprint Nextel 401K Plan Four Core Asset ETF (EM) Benchmark
    Diversification above average (83%) poor (8%)
    Fund Quality below average (15%) poor (8%)
    Portfolio Building average (59%) below average (20%)
    Overall Rating average (53%) below average (13%)

     

    The chart and table below show the historical performance of moderate model portfolios employing strategic and tactical asset allocation strategies (SAA and TAA , both provided by MyPlanIQ). For comparison purpose, we also include the moderate model portfolios of a typical 4 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
    Emerging Market Equity: EEM or VWO
    Fixed Income: AGG or BND

    Performance chart (as of Mar 21, 2011)

    Performance table (as of Mar 21, 2011)

    Currently Commodities, Real Estate and US Equity are doing well. Only US Equity is available to Sprint Nextel 401K Plan participants.

    To summarize, Sprint Nextel offers its employees average rated fund choices. It has strong fixed income funds or portfolios. Some low cost funds such as DFA index fund or S&P index funds are good portfolio building blocks. Actively managed funds such as American Century Equity Income (TWEIX) or GMO Global Equity Allocation (GMGEX)  have been outstanding. The plan can extend its diversification by offering further funds in major asset classes such as REITs as well as some high quality actively managed equity funds.


    Disclosure:

    MyPlanIQ does not have any business relationship with the company or companies mentioned in this article. It does not set up their retirement plans. The performance data of portfolios mentioned above are obtained through historical simulation and are hypothetical.

    Symbols:S,T,SPY,VTI,EFA,VEU,EEM,VWO,AGG,BND,VT,HYG,JNK,PHB,CIU,BIV,GWL,PFA,IVE,IWW,JKF,VTV,ELV,PWV,RPV,SCHV,IGOV,BWX,WIP,IVV,IYY,IWV,VV,DLN,RSP,SCHX,IOO,IVW,IWZ,JKE,VUG,ELG,QQQQ,RPG,SCHG,IJH,IWR,JKG,VO,MDY,EMM,PJG,DON,EZM,MVV,IJS,IWN,JKL,VBR,DSV,PWY,RZV,UVT,IJR,IWM,JKJ,VB,DSC,PJM,DES,SAA,UWM,SCHA,GMM,PXH,DEM,SCHE,GBF,LAG,IJK,IWP,VOT,EMG,PWJ,RFG,UKW,TWEIX,DFSVX,HAMGX,PHIYX,PFUIX,GMGEX,

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