Comments on: Vanguard Investors Outperform Fidelity Investors http://www.obliviousinvestor.com/vanguard-investors-outperform-fidelity-investors/ Investing Blog: The Oblivious Investor Tue, 07 Feb 2012 17:04:11 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Aaron Margeson http://www.obliviousinvestor.com/vanguard-investors-outperform-fidelity-investors/comment-page-1/#comment-3734 Aaron Margeson Tue, 27 Oct 2009 16:19:50 +0000 http://www.obliviousinvestor.com/?p=5247#comment-3734 I admit I "timed the market". When I had some extra cash to either invest or put in an emergency fund once I paid my debts off back in July, Even though I hadn't built a proper rainy day fund yet, I fully funded my Vanguard Roth IRA target retirement age fund, knowing that: A. I would have extra cash later to put towards savings for an emergency. B. This lump sum wasn't all the extra cash I had. C. The market had nowhere to go but up significantly in the long run, and would likely rally in the short run significantly. D. I could pull some money out of a Roth IRA penalty free if I absolutely had to. Conventional wisdom would have been to build the emergency fund first, but I decided to be more risky and do that. Turned out to be a solid choice. I've socked away more money in my emergency fund since then, although it's still not completely built to where I want it to be, but I've also made an almost 20% return on my IRA money already in four months. Normally, I don't believe in "market timing", but decisions like mine where it's long run focused and pretty obvious you're going to likely do well, how can you not? I'm an Oblivious Investor, but not THAT oblivious... :-) I admit I “timed the market”. When I had some extra cash to either invest or put in an emergency fund once I paid my debts off back in July, Even though I hadn’t built a proper rainy day fund yet, I fully funded my Vanguard Roth IRA target retirement age fund, knowing that:

A. I would have extra cash later to put towards savings for an emergency.
B. This lump sum wasn’t all the extra cash I had.
C. The market had nowhere to go but up significantly in the long run, and would likely rally in the short run significantly.
D. I could pull some money out of a Roth IRA penalty free if I absolutely had to.

Conventional wisdom would have been to build the emergency fund first, but I decided to be more risky and do that.

Turned out to be a solid choice. I’ve socked away more money in my emergency fund since then, although it’s still not completely built to where I want it to be, but I’ve also made an almost 20% return on my IRA money already in four months.

Normally, I don’t believe in “market timing”, but decisions like mine where it’s long run focused and pretty obvious you’re going to likely do well, how can you not? I’m an Oblivious Investor, but not THAT oblivious… :-)

]]> By: Mike http://www.obliviousinvestor.com/vanguard-investors-outperform-fidelity-investors/comment-page-1/#comment-3733 Mike Tue, 27 Oct 2009 16:10:14 +0000 http://www.obliviousinvestor.com/?p=5247#comment-3733 Rob, I did not say that <i>all</i> investors fail at timing the market. I simply said that mutual fund investors usually fail when attempting to do so. There is an abundance of information regarding mutual fund cash flows that backs up this claim. Rob, I did not say that all investors fail at timing the market. I simply said that mutual fund investors usually fail when attempting to do so. There is an abundance of information regarding mutual fund cash flows that backs up this claim.

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