Vanguard Lowest Risk Funds?
 

Right now, between my wife and I, we have about 360k all in VFORX.

Hasn't been in there for long, kind of a temporary parking spot.


Anyhow, I'd like to take approx 200k of that and move it to something at Vanguard that's extremely low risk for 6 months to 1 year. Is a bond fund or money market my only choice?




What are my other options?


I am just being silly?

A CD or an i-bond are probably your best options. Bond funds might be lower risk than stock, but for that short of a time period, you might be better off with something with even less risk. You could even go to a high-yield (*cough* 1% return *cough*) savings account if you want to keep the money more liquid.

I don't want liquidity, just "safety".

Forgot to mention, this is all in IRAs or Roth IRAs.

Right. In terms of 'safety', an i-bond, CD, or savings account are you real options. Money market will do worse than any of those.

Hope that helps :).

If your goal is safety and predictability, I would stay away from bond funds - especially right now as interest rates are poised to start back up in relatively short order.

If you're comfortable sharing your goal with this $200,000 it might get ideas even more appropriate to your specific situation.

Thanks.

It's all just retirement money.

40 y/o right now.

just curious, if its retirement money ,why the short 6-12month time frame for it?

Just a gut feeling.

Getting nervous lately.

Probably no good reason for it.

Just curious, would that gut feeling have to do with the DOW reaching record highs and the economy is in the tank and the chickens have to come home to roost at some point?

I would strongly caution you against doing that. You are very well diversified in a very good fund. Market timing is gambling. $200,000 is a lot of money to put at such risk. Your target retirement fund is so diversified that by not believing in the long-term success of that fund is not believing in the long-term success of worldwide capitalism.

You have made very good decisions putting so much money away in your retirement accounts at the best brokerage on the planet in one of the best funds there is. I would continue making those same good decisions by staying the course.

Thanks Brian.

I was waiting to hear your advice.

I'm gonna sleep on it for a few days.

You're welcome.

how much of your portfolio is in one fund? might want to diversify...

he stated that hes got 360k in VFORX...which is the target retirement 2040 fund. which in itself is already diversified(according to vanguard it is ~90/10)

If you are feeling uneasy you could always move some of the funds to a closer date Target retirement fund like 2030 or 2045. VG should give you the breakdown of how your funds are diversified and if you want to move to a more conservative approach just pick funds with more bond allocation. In 6/12 months you feel more confident then you can move some of the funds into back or into a diff Target fund with a further out date to allocate more to stocks.
I actually have a similar situation to you, but am 30 and have my funds in a 2030 and 2045. This basically satisfies both my conservative and risk sides.

I like this idea. Hadn't really thought about that.

edit...


to my novice eye, they all appear to have about the same amount of volatility


http://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1360851658994&chddm=912985&cmpto=MUTF:VTWNX;MUTF:VTTVX;MUTF:VTHRX;MUTF:VFINX;MUTF:VFORX&cmptdms=0;0;0;0;0&q=MUTF:VTXVX&&ei=xvIcUcDzGIW2rQHKxgE



here's the 1yr chart


http://www.google.com/finance?chd...GYTFqgHZcA

In lieu of short term bond index funds, what would be a good alternative to park money saved for a down payment on a house in 3-5 years?

Please provide proof of your gut feeling's track record, from a neutral verifiable source, such as the Hulbert Guide to Financial Gut Feelings.

Actually the best reason to go to cash now isnt pessimism but optimisim: the stock market has been pretty good for the past 3-4 years, although sentiment still isn't as optimistic as it was back in 2007, at the last market peak. Some time in the late 1990s, when the stock market was still on a long bull run, Hulbert wrote that about half the financial newsletters he tracked were bearish, half were bullish, and it seemed that was the long term norm. Flipping a coin will also be half bearish, half bullish. And Elaine Garzarelli, who became famous for predicting the October, 1987 crash, hasn't done very well since, except for predicting a bear market in the 1990s -- on the very day of the market bottom for the year. Another person who did the latter was Joe Battaglia, who "changed his mind" a few days later. Both were articulate and highly confident in their words, as is every CNBC guest.

getting nervous again here....

Can you point to which of these components of VOFRX make you nervous and why they do?

http://portfolios.morningstar.com...ture=en-us

Have you read articles about market timing, written by people who don't make money from timing? What do you think?