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 401

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Dear Loyal Members and Subscribers,

Due to several different circumstances, we have made a very difficult decision to close down the FedsFunds.com website.  

For the past seven years, we've shared with our fellow Employees, a wealth of Delta 401k investing information through our web site at a very reasonable cost. Unfortunately, the challenges facing us make it impossible to continue posting this information online (effective February 28^th).

We will continue to provide Members with the core charts and information that we've provided in the past, but it will be via email only. For current Members (those who are up to date with their Membership fee), we'll send  the following charts to you in .pdf format: 

Weekly: Fed's Funds Weekly  (for Stocks and Bonds)

Quarterly: Fed's Funds Quarterly  (for Stocks and Bonds)

Annually: Fed's Funds Annual  (for Stocks and Bonds)

(The remainder of the charts and the weekly UpFront Newsletter will no longer be available)

We will also attempt to continue sending the free Fed's Funds 50 weekly chart to all Subscribers.

While every effort will be made to send our weekly e-mails by Sunday evening, there may be a rare instance where it may take until Monday or Tuesday of the following week. Thank you in advance for your patience.

There are also inevitable changes that we've been told will occur this year within our 401k plan. The available fund options may be drastically different from what we currently have access to.

We will continue to send the above mentioned charts to you until your Membership runs out, or until these upcoming changes take effect, or the end of this year (whichever comes first). We'll also try to keep you informed of any developments regarding the Delta 401k.

We realize that this will be a different product than what you originally signed up for. Therefore, we are prepared to offer partial or pro-rated refunds to those Members that request one by replying to any of the emails that you receive from us. Just type the word "Refund" in the subject box and be sure to provide us with a valid PayPal account or mailing address.

Please accept our apologies and our appreciation for helping make Fed's Funds the success that it has been. We know from the feedback you’ve sent since our inception in 1998 that Fed's Funds has helped many of our fellow Employees make the most of their 401k.

Thank You So Much,

The Staff at Fed's Funds

Keep It Clean, Keep It Simple…

Keeping your 401k cleaned up and simplified will give you better clarity and improve your ability to compare, noticing those choices are moving you forward vs. those that are weighing you down.

Just like a tool bench or even your kitchen countertop, sometimes we accumulate too much clutter and it slows us down.  Eventually the frustrating disarray affects our judgment as we’re trying to accomplish our goals.

Bite Size It

We can deal with almost anything if it's sized right.  So try sectioning your 401k balance into 10% chunks.  This will give you 10 fund choices to deal with.  12.5% pieces would give you 8 choices to handle while 20% would give you 5.

As a result you’ll eliminate all those little leftover remnants of funds that you just wanted to “try” for a while.

Diversify It

Our 401k has Six Basic Investment Categories (Small, Mid & Large-Caps, Balanced, International and Bond Funds) plus the “Stable Value Option” (Money Market type funds). 

While we always encourage people to weight their holdings toward the categories that are healthy and less toward those that are out of favor, it is still very helpful to have an age-based Allocation Chart as a general guide.

Here is a link to some simple and fun allocation pie charts that lets you select your age and adjusts itself to your selection:

Asset Allocation Charts From Bankrate.com *

Write It Down

Finally, writing it down on an actual piece of paper is really the best way to remember your funds and current diversity mix.  Here’s a copy of our simple 401k organization chart:  2010 Organizer/Tracker

Note: When you change funds also review your Contribution Selections to ensure that you not continuing to contribute to your previous funds!

Getting a Pay Raise Soon??  Don’t Forget To Give Your Future Retirement A Raise As Well by increasing your 401k Contributions a percent or two.  Here’s a calculator that can show you the net affect on your take home pay:  PayCheckCity.com*

Wishing You The Very Best Of Returns,

The Fed's Funds Staff

Investing For A Retirement

You Can Count On!

FedsFunds.com

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Starting The New Year, Down…

Three of the last four weeks have brought in some rather ugly returns. But Look Close, It Fits The Pattern.

Reviewing 2009 we see a lot of Market action as well as an interesting pattern that develops during the weeks just prior to and after each Change of Quarter.

If the Quarterly results are negative then we see strong positive returns just prior to and after the quarter change:

But if the results for the Quarter were up then we see strong Market action in the downward direction for the surrounding weeks:

Honestly, "ours is not to reason why," we just take note of the trends and refuse to panic or give up when Quarterly Corrections like this happen.

Wishing You The Very Best Of Returns,

The Fed's Funds Staff

Investing For A Retirement

You Can Count On!

FedsFunds.com

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

"I’d Just Rather Not Look At It"

So many times we hear this sentiment from fellow Employee 401k Investors.  We often suggest that they put their 401k on Auto Pilot.

Some of the Fund Managers of our current 401k funds are nothing short of excellent.  They "pilot" their funds through market storms as well as into market updrafts.  Their funds don't drop like rocks but rather glide in the downturns and then recover well when good flying weather returns.

Fed's Funds recognizes and rates these high quality funds with Auto Pilot Ratings.  On this one page of qualifying funds, they're rated in simple airplanes QQQ. 

The more airplanes shown the more stable and reliable their fund performance has been in comparison with each category index. 

These ratings examine the past 10 years for any "crashes," the past 5 years for "smooth landings" as well as the past 3 years for strong returns.

Choosing funds that have achieved this rating allows the Investor to casually check the updated APR page once a quarter to see if their funds have dipped below the index performance.

This quarterly updated info is called Recent Turbulence and it's color-coded green, yellow, orange or red to quickly show Investors their fund's current condition.

For those unfamiliar with APR, we've made a sample of the chart available here: 

Auto Pilot Ratings Sample

For Members who would like to see the latest APR update please log in here: 

Auto Pilot Rated Funds

Wishing You The Very Best Of Returns,

The Fed's Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Will 2010 Be Like 2004, or 1931??

Obviously 2009 was a Boom Year for the Stock Market.

So now the question most Investors are wrestling with is; Will 2010 be an "after glow" year or will we see a nasty "correction" this coming year?

Gloomy Bears point to 1931 when the 1929 crash fears revived and brought new lows to the Market.

Big Bulls are looking at the multi year Bull Markets like 2003/2004 saying the conditions are right for a continuing upward climb.

What Year Will 2010 Most Resemble*

(MarketWatch/Barron's Video)

In a nutshell, as Investors we are weighing our Confidence and Fear and investing accordingly.

In their article, Ten Investing Ideas For 2010, MarketWatch* states:

“Knowing that there can be too much of a good thing, many investors are wary about how stock and bond markets this year will follow their remarkable 2009 surge.”

They go on to say:

"After the first nine months of the stock market's rally from recession lows, the average pace of the stock market's advance clearly slowed, …but, and this is crucial, the market tended nevertheless to continue rising."

Here are some of the Ten Investing Ideas they present in the article:

·         Buy stocks with a global footprint

In a slow-growth environment, bigger is better.  Global companies have diverse revenues and operations, which both insulates core businesses and fosters innovation and expansion.

U.S. companies in the past decade have been impressive examples of how to operate effectively overseas. Moreover, these companies are exporting their business to fast-growing emerging markets. Almost half of the revenues for companies in the S&P 500 stock-index now come from outside of the U.S.

·         Use stock dividends as a bond substitute

Shares of companies with strong balance sheets and stable earnings growth are not only better-equipped to handle the economy's waves, but their dividend income is a welcome alternative to the uncertainty swirling around bonds.

·         Buy larger-cap index funds

Large-cap stocks lagged their small-cap and midcap counterparts in 2009, but many observers say that big firms' time has come.

·         Stick with technology stocks

“They've got robust balance sheets, phenomenal free cash flow, and while the stocks have done well and valuations aren't as cheap, there is room for them to outperform."

Read The Rest Of The Article Here:

Ten Investing Ideas For 2010

By Jonathan Burton, a personal finance editor

From MarketWatch.com*

Wishing You The Very Best Of Returns,

The Fed's Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

1 Year & 4-Year Strength, Who's Got It??     *^* * *^* * *^*

Looking for a balance of short-term and long-term strength is a great way to find well managed funds.

Most 401k Investors don't want to be popping in and out of funds any more than necessary so we often look for Fund Managers who wisely adjust their holdings to compensate for market changes.

The 2009 / 4-Year, Fed's Funds 50 chart below shows just that type of information. A few of the default Freedom Funds are included for comparison as well. Beware of those funds that are severely negative for 4 years.

Fund Note

Several fund closeouts have occurred:

Calvert New Vision

Calvert Capital Appreciation

Managers Special Equity  

Morgan Stanley Fixed Income  (Bond Fund)

RS Smaller Co Growth

Also FMA Small Company (FMACX) has been changed to John Hancock Small Company (JCSAX).

Wishing You The Very Best In 2010,

The Fed's Funds Staff

Investing For A Retirement

You Can Count On!

*^* * *^* * *^* FedsFunds.com  *^* * *^* * *^* 

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

'Tis The Season To Collect Dividends...

Oh Ho, Ho!!!  And You Thought Christmas Was Just For Kids!

Well forget that Humbug and Log-In to your 401k NetBenefits, Transaction History Page to see if you made the Naughty or Nice List.

Many funds pass along dividends at the end of each year.  These are collected from the dividend paying stocks that the funds have owned.

About.com* puts it this way:

"When a company earns a profit, it has several options, one of which is to distribute some or all of the cash to the owners (the stockholders) by mailing checks out from the corporate treasury. These checks are known as dividends."

Ownership

As 401k Participants we don’t often think of ourselves as Corporate Owners but look a little closer at each of your funds and you’ll see their corporate holdings that you partially own as an Investor.

For instance, if you hold Fidelity Balanced you are part owner of Microsoft, Intel, Google, Chevron, Shell          Oil, Procter & Gamble, GE, Coca Cola, and Wells Fargo.

Check Out your ownership by clicking on the Fund Names below:*

Members can find all the fund ticker symbols to use on the Morningstar Top Holdings Page here:   Member’s Fund Info

Wishing You A Very Merry Christmas Season,

The Fed's Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Fidelity Brokerage Link, What Is It??

And Why Does It Matter??

On Dec. 1^st Delta sent each 401k Participant a notice announcing major changes to our 401k.  (See the Dec. 5 Newsletter or the Weblog)

The changes include reducing and possibly eliminating our access to name brand funds through our "Window" Of Investment Options. (Brand type funds like Janus 20, Contra, Oakmark, etc...)

According to the notice, access to some of these funds will still be possible through the Fidelity Brokerage Link, although additional fees and restrictions may apply.

The Link

As the name implies, it's a link that enables your 401k money to be invested using a broker type account.  This expands some choices and can eliminate others.

For instance, current users of the Brokerage Link can access over 4000 mutual funds instead of just the 200+ available through the "Window". 

Unfortunately with the Window closed, many excellent/popular funds become closed to us as "new investors" or some are only available with loads or heavy transactions fees using the Brokerage Link.

Some examples include:*

Janus 20 - Closed to new investors.

Wells Fargo Small Value Z - Transaction Fee $75, Closed

Rainer Small/Mid Eqty - Closed

Templeton Developing - Front Load 5.75%

Still there are currently over 1000 no-load/no transaction fee funds available through the link but many of these may not be quite the type, quality or low fee funds that many of us have been used to.

Good News??

One consolation mentioned in the Dec. 1 communication is that Investors will "have access to an even broader array of funds and other investments via Brokerage Link."  "Other investments" refers to individual stock equities and ETF funds.*

Wishing You The Very Best Of Returns,

The Fed's Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Name Brand vs. Generic...

It's Often True, "You Get What You Pay For."

If the generic was always just as good as the real thing we'd only have store-brand food in our shopping carts and every Value Jet/Air Tran flight would be completely full.

Upfront cost savings can be very attractive even with Generic Mutual Funds, but as we've all learned, "saving a nickel now can end up costing us a dollar later."

While looking over the Northwest 401k we found 15 funds total.  13 of these were prepackaged, generic funds designed to minimize decisions and make 401k investing a "no-brainer." 

If you want to invest in an International Fund they have one of those for you.  The same for Small-Cap and Large-Cap.  If you just want to mix it up somehow, they provide a Multi Asset Fund.

How well do these Basic, Generic Funds perform when compared to the Name Brand Funds that we're  accustomed to (Magellan, Contra, Janus 20, etc... )?  These Funds compete for customers in the public marketplace.

Well... Comparing our Delta 401k Top 40 with the entire NW list for the past year, only one of the 15 NW Funds was competitive.

No Brainer Investing

Unfortunately, easy, "no-brainer" investing often costs Participants dearly when it comes to performance.  (See Chart Below)

Delta had many International Funds returning 70, 80 and over 90% for the past year.  The International NW Fund came in at just over 51%.

Small-Cap Delta Funds came home in the 40's, 50's and 60's.  NW's generic Small-Cap showed up with just under 35% for the last 12 months.

Large-Cap returns are the same way with NW's basic Large-Cap Fund returning 33% while Delta was once again in the 40's, 50's and 60's.

Sadly NW doesn't have a Mid-Cap Fund Category.  If we look over the past 12 or 13 years we find that the Mid-Cap Category has given Investors the Best Overall Return.  Interestingly, it's also among the Best Performers In Down Years as well.  13-Year Index Returns

Why Is This Important??

As we mentioned last week our Delta 401k is being overhauled and apparently most if not all of the current funds in our "Window of Funds" will be removed and won' t be a part of the core funds available in the plan.

The big change will increase our basic Core Investment Option choices like the current Comingled Stocks, Comingled Bonds and Growth Balanced Funds.  They'll be expanded to include more investment categories like Large Cap Growth and International, seemingly similar to an enlarged NW style 401k.

Delta Name-Brand Fund to NW Generic-Fund Comparison:

Once again "Performance Pays" and it shows vividly in this comparison.  Certainly the fees for the generic plan are much cheaper, but at what cost to the Participant's 401k Performance??

Wishing You The Very Best Of Returns,

The Fed's Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Heads Up Alert,

Big Delta 401k Changes...

It's Time for an Overhaul!!

This past week Delta mailed out a "Heads Up" notice to Employees briefly describing the 401k Fund Realignment coming in the 2^nd quarter of 2010.

Our 401k will be divided into three basic areas:

1.     Lifecycle or Target Date Funds, similar to the Freedom Funds we currently have.

2.     The Core Investment Options like our current Comingled Stocks, Comingled Bonds and Growth Balanced Funds, will be expanded to include more investment categories like Large Cap Growth and International.

3.    The Brokerage Link Option will allow Delta Investors to invest in many of our current "Window Mutual Funds" that we are currently familiar with like Contra, Magellan and Janus Twenty. (Apparently most if not all of the current funds in our "Window" will be removed from our 401k, the Brokerage Link will allow some access to them, probably at an increased cost to the Investor.)

These changes open the door to hundreds of questions so we are diligently inquiring at different levels within Delta and Fidelity.

The reasons we are hearing for the changes are many and sometimes complex.  Apparently there is a significant cost savings gained from eliminating the "Window of Mutual Funds" and changing to "customized" Core Investment Option type funds.

We've also heard the opinion that our current "Window" is overly complex and underutilized so many Delta Investors have become "paralyzed" because of too much choice.

As Delta Employees, two of our chief concerns in this transition are the quality/diversity of the Core Options that will be "customized" for us, as well as the increased costs passed on to 401k Investors who choose to utilize the funds they are familiar with through the Brokerage Link.

It's important to mention that along with the possible increased costs of the Brokerage Link there will be increased opportunity for those who wish to delve into Individual Stocks or ETF Funds. (We're told that DAL stock will not be an option.)

We have asked if HR will be taking Employee e-mailed comments or opinions, so far we have not received a positive response to this idea.

It will be important for all of us to keep up with these changes before they happen.  As it says in the last paragraph of the Heads Up Notice; "you will be able to make decisions on how you want your current account balance moved to the new funds and how you want your future contributions invested."

The notice also states that, "full details will be communicated in spring 2010."

As with other changes in the past we will seek to keep you informed so you can make your best investing decisions.

This e-mail goes out to about 800 Delta People coast-to-coast, including the Aloha State of Hawaii.  If you find this information on the 401k change to be beneficial please share it with others in your work area by printing/posting or forwarding this to them for their benefit as well.  Thank You Very Much!

Wishing You The Very Best Returns,

The Fed's Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

It's Been Good!!

In Our Country, It Seems The Media's Job Is To Focus On The Negative, The Sensational And The Unbelievable.  Reality, as most of us know it, is somewhat different than the daily news bombardment.

So to be thankful in this season it helps to refocus on some of the good things that are often overlooked by the sensationalists writing the news.

To be honest it's been a rocky year, a year where stability and growth are uncommon and appreciated blessings.  Thankfully, most all of us have enjoyed these where we work.

OK, we're in "the longest recession since WWII", but the Market doesn't think so: S&P 500 YTD

A Few More Reasons For Gratitude:

11 Things to Celebrate as 2009 Comes to a Close

From the Kiplinger Washington Editors, Kiplinger.com*

We've had a rough year, yes, and the gloom gathers still.  But take heart. We at Kiplinger believe the longest and steepest recession since World War II is over*. And though the recovery likely will be long and difficult, we note 11 significant developments and trends to be thankful for as the holidays approach.

How about that stock market?

From March 9, the low point of the bear market, through late November, the Dow Jones industrial average climbed 63%, Standard & Poor’s 500-stock index rose 61%, and the Nasdaq is up 72%. Year-to-date, the Dow has yielded a 23% return, if you include reinvested dividends; the S&P 500, 25%; and the Nasdaq, more than 37%.

Virtually all taxpayers will be able to open a Roth IRA in 2010, securing tax-free income in retirement.

Although income-eligibility restrictions will remain for ongoing Roth IRA contributions, anyone, regardless of income, can convert a traditional IRA to a Roth IRA* as of January 1. You'll have to pay taxes at your top income-tax rate on any amount you convert, but all future earnings are tax-free. So are all withdrawals, once the account has been open at least five years and you are at least 59½ years old.

Credit-card debt is declining.

September's Federal Reserve Board survey showed credit-card debt dropping by $10 billion, an annualized decrease of 13.3%. At the same time, the average credit-card balance is increasing as cardholders consolidate their debt on fewer cards. New credit-card charges dropped by about 2%, according to market-research firm Synovate. Default rates, although still at very high levels, dropped for five of the top six credit-card issuers in September.

The personal savings rate is up.

When taxpayers started receiving stimulus checks in May 2008, they tucked away that money rather than spending it, as signs of the recession first started to appear. Result: The savings rate skyrocketed to 5.8%. The most-recent figures show that we’re still squirreling away 3.3% of our disposable income. That’s still far below the 10% that was typical 25 years ago but a lot better than the near-zero savings rate three or four years ago.

Read It All: 11 Things to Celebrate*

Wishing You The Very Best Returns,

The Fed's Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Fear Or Confidence??

From Mid-July to Mid-September the U.S. Market ran up about 20%. Then from Mid-September to the present we've made virtually no progress.

Index 3-Month Graph*

When Confidence runs thin, Fear steps in. So if current fears seem justified the Market will probably trend down and correct through the end of the year. 

But if Confidence is gained from positive earnings reports or Federal policy statements then we're likely to see a nice Christmas Rally!

Of course there's always the possibility of the struggle continuing between the positive and negative, resulting in more market stagnation.

In a nutshell the Market is looking for confirmation of its recent run-up and clarity for the coming year.  So we can look for swings up and down until confidence is either gained or lost.

One Optimist's View Point

Bernanke's Not the Bogeyman
Posted at 2:22 p.m. EST, Nov. 16, 2009

All I heard last week was "be careful on Monday, because Ben Bernanke is speaking." Bernanke was widely presumed to be a rally killer, someone who could really reverse the trend.

How can this be? Can someone tell me how this man, who has done so much to turn things around, can be considered so dangerous? Did they think he would give some sort of "irrational exuberance" talk? Did people think he would say the economy is so strong that it is time to take away the punchbowl?

Ben Bernanke is a student of the 1930s. He recognizes that the moment he takes away the stimulus the Fed is providing and Congress raises taxes, we have a 1937 sell-off on our hands -- without the "help" of World War II to turn things around.

I think that people had better start recognizing that Ben Bernanke is real smart, that he has our backs.

Read It All Here: Jim Cramer's Best Blogs  TheStreet.com*

Wishing You The Very Best Returns,

The Fed's Funds Staff

Investing For A Retirement

You Can Count On!

FedsFunds.com

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

I'm Tired Of It, I Need A Break...

Q.  Honestly, Right Now I'm Just Tired Of Keeping Track Of My 401k.  There are times when I can't give my full attention to making these decisions, what should I do, just let it go??

A.  Well, honestly it can be dangerous to "let go" and leave your retirement money unattended. 

Like driving a car or piloting a boat or a plane, you want to get somewhere without a major mishap, so just letting go and trusting sheer luck can invite disaster.

Not all mutual funds are "401k Friendly" with Managers that balance Stability with Performance.  Many are taking more risks than you may like.

Still, we all need a break when the rest of life just overwhelms us and we have to devote our attention elsewhere.

In a similar situation, Pilots would simply activate their on-board Autopilot and then turn their attention to the problems at hand.  Fed's Funds offers Delta 401k Member Investors this same type of "Autopilot" feature. 

By compiling a list of Delta 401k Funds that have a 10-year history of Stability and Index Beating Returns, Investors can choose from 27 funds with proven Managers at the helm.

We applaud the "401k Friendly Managers" who "pilot" these funds, for their talents, skills and dedication to protect their Investors and generating very competitive, Index Beating Returns.

The Fed’s Funds "Autopilot Rated Funds" Page is completely reevaluated every calendar year and then updated for recent performance every quarter.

Those funds that are "flying" lower than their Index are color coded yellow, orange or red.  A quick visit to this page once a Quarter can confirm whether all is OK so Investors can quickly return their focus to life's circumstances and situations.

Wishing You The Very Best Returns,

The Fed's Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Delta 401k Funds:

Making The Most / Losing The Least...

Fed's Funds tracks and analyzes the Delta 401k Funds more avidly than anyone.  We share our information with any Delta Employee who requests it, and more exclusively with our Members.

The simple chart below shows only how the Delta Funds have been doing for the last 13 weeks, by Category.  This is updated every week on our Fed's Funds 50 page: Free Info Page

In the listing below we took a look at the first chart of every month and found that for the last six months (Up Market) the Delta 401k International Funds have been the clear winner.

This "Winning Streak" is a continuation of the 2003 to 2007 streak when Internationals beat virtually all U.S. Domestic Markets.  See 13-Year Index Chart

So for the last seven year International was the best place to be in the Up Years.  While the best place to be in a Down Session (as shown below) was either the Balanced Funds or the Bond Funds. (See the 13-Year Index Chart)

Certainly we're not advocating an all International portfolio.  Rather we are doing what we always do, pointing out the best opportunities and encouraging a stronger portfolio weighting in the healthier areas of the Market.

As Always!

Wishing You The Very Best Returns,

The Fed's Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Hitting The Jackpot,

Or Hitting The Bull's-Eye??

It sounds so simple and easy yet for the typical human being it's one of the most difficult things to do.  BUY when the price is low and SELL when the price is high.

When the big, bad Bear is tearing down market values our natural instinct is to run and hide.  Who wants to throw good money after bad in a market like that??

At the opposite end, when the Bulls are charging along strong and healthy, who wants to leave the action and sell when the good times are rolling??

Should We Try To Get As Much As Possible?

The problem is that most of us are preprogrammed with the jackpot mentality of trying to "get as much as we can."  The games we play and the game shows we watch set the tone, "The one who gets the most wins!"

But as with most games, the problem in the end is there are only a few jackpot winners.  Most of the players end up to be the losers that risked all they had and came up short.

Bull's Eye

When it comes to retirement investing it's important that we're aiming for realistic targets that make sense for our personal situations, rather risking it all, aiming for the sky and then falling short when the Bears show up.

Consider Your Personal:

• Retirement Account Balance
• Retirement Date  (predicted)
• Retirement Financial Needs (predicted)
• Retirement Income From Other Sources

              (Spouse's Income, Inheritance, Part-Time Jobs…)

By "doing the math" we begin to accurately view and focus on our personal 401k target.  What can we realistically save and how should we invest to hit our personal bull’s eye to retire on-time and on-target?

Aiming for the Bull's Eye rather than the Jackpot is not only more sensible and achievable; it's also far more satisfying in the long run.

Bear Markets Do Wonders for Retirement

October 27, 2009  TheStreet.com*

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

International Funds Show Stability...

In the past we've viewed Internationals as either Hot or Cold, volatility was their middle name. As a result many Investors simply stayed away. 

But now that we can look back at the recent market crisis, we're noticing that International Funds out-performed US funds before the downturn and on the rebound, while almost equaling US. Fund performance during the downturn itself.

The funds we're referring to are the diversified Internationals with Large-Cap holdings in many sectors and in several countries or regions.

Of the 35 International Stock Funds offered in the Delta 401k, 30 of these are Large-Cap Funds.  So we compared two similar Index Tracking Funds, one for the S&P 500 and one for the Large-Cap EAFE Index. (Europe, Australia/Asia and the Far East)

Here's what we found:

US Large-Cap Funds offered Investors only a slight margin of safety in the downturn and significantly lagged similar International Funds both before and after the 2008 - 2009 slump.

Boosting Your Diversification

Are you well diversified if you don't have a significant portion of Internationals?

Honestly, it's an individual choice to go International or to stay Domestic, everyone has different opinions.  Here's a Fidelity article that suggests different International weightings for your portfolio depending on what type of Investor you are:

Why Foreign Stocks are Important

Fidelity Viewpoints

October 21, 2009

Another compelling rationale for holding foreign stocks: More and more of the world's growth is coming from outside of the U.S. Almost 60% of the world's equity market capitalization is outside of the U.S.—and over the last 10 years, more than 80% of the world's stock markets have outperformed the U.S. stock market.

Many economies have produced faster growth than the U.S. in recent years, moving the U.S. from representing 31% of world gross domestic product (GDP) to 24%.

Why Foreign Stocks Are Important*

Need To Find A Reliable, Healthy International?

High-5 International Chart (Member Sign-In Reqd.)

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Quickie Quiz Questions…

You Are This Week's Topic.  How well do you understand mutual funds?  Do you know the instincts or the psychology of a successful investor?

The quiz links below will help you understand more about yourself as well as each investing topic.  Now don’t sweat it if you get less than an A on each quiz.

The point is both to learn and to realize that some investing questions have no absolute right answer.  Differences of opinion exist even among highly trained experts.

Question after question you'll be given the "text book answer" that all investors need to be aware of.  From your own experience you’ll recognize that there are exceptions to every rule of thumb.

Experienced investors know when to apply these exceptions to their investing strategy, that's something only experience can teach us.  But of course it all starts with understanding the text book answers first.

The 10 question interactive quizzes below comes from our favorite  personal finance and advice magazine, Kiplinger.com*

Q1: How Well Do You Know Mutual Funds?

Q2: Test Your Investing Instincts

Q3: REVIVING YOUR RETIREMENT PLAN: WHAT TO DO NOW

Q4: RETIREMENT PLANNING: HOW PREPARED ARE YOU?

Q5: THE INVESTOR PSYCHOLOGY

This quiz comes with an article:

Be a Better Investor

Outsmart your emotions, cut your fees, keep it simple­ -- and reap higher returns.

By Bob Frick, Senior Editor, Kiplinger.com*

“In many ways we're predisposed not just to buy high and sell low, but to cling to losing investments we should sell.”

“These tendencies are now well documented in the burgeoning fields of investor psychology and behavioral finance. Scholars in both disciplines are arriving at a new understanding of how humans make decisions.”

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Understanding The Rest Of The World…

The Company we all work for or have worked for is now the world's largest airline, supplying air service to and from 66 different countries.  Including Code Sharing Partners we actually serve 112 countries. 

How many were on the list when you were hired?  I remember three, the UK, Germany and Canada.

For Delta to survive and thrive to this extent, they had to make the decision to expand their understanding to include opportunities in other countries.

As Investors in a country who's economy is no longer the unrivaled powerhouse it once was, we face the same type of decision.

Will we expand our understanding globally to take advantage of very profitable international investing opportunities?

Recession’s Long Term Affects  2 Minute Video, MarketWatch.com*

Summary: U.S. Job/Economic Growth Will Be Soft Overall with little to no job growth in Construction, Manufacturing and Banking.  Some growth foreseen in Health Care, Education, Business Service/Consulting.

Help for Dollar?  1 Minute Video From MarketWatch.com*

Summary: The Dollar's decline will likely continue for some time.

Learning From Fund Managers

International Fund Mangers are the paid experts when it comes to choosing where, when and how much to invest overseas.  They often have personal experience from living in the countries or regions they are responsible for.

The links in the chart below will show you the Top 25 Holdings of each International Fund.  At the top of the Holdings Chart you’ll see a Portfolio Tab that will show you country and regional exposure percentages.

What country(s) do you think hold the greatest opportunity?  The links below show you each Fund Managers professional opinion:

From Morningstar.com*

The Most Promising Emerging Markets 

2 Minute Video, MarketWatch.com*

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff

Successful Investing For A

Successful Retirement!

FedsFunds.com

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

45% Of Stock Funds, Positive for 1-Year...

Yes, 45% of the Delta 401k Stock Funds have made money for Investors over the past 12 months!  The end of 2007 was the last time we could make this kind of claim.

Of the remaining 55%, almost half of these funds are still deep in the red, more than 5% in the red; some are running as low as -23%.

Back on the bright side, some of the money making funds have returned in the mid to high 20’s, proving again the value of keeping your money in the right place and under the right management.

See The 1-Year Returns Here: 1-Year Stock Funds

Some Best/Worst Comparisons:

International Best/Worst

Balanced/Freedom

Large Cap

Mid Cap

Small Cap

To give you a better idea which sectors have rebounded best consider this:

72% of the Delta 401k Internationals are positive for 1 year.  73% of the Balanced/Freedom Funds are also in the black. 

52% of the Large Growth Funds are in the black but only about 22% of the Large Blend and Value Funds are positive.

23% of the Mid-Cap Funds are positive while 29% of the Small-Caps are in the black.

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

 Reported performances of the past are not a prediction or guarantee of future returns.

Taking Emerging Markets More Seriously…

Well-Informed Investors Know That Emerging Market Countries Are Quickly Becoming Emerging Economic Powers. Their growing economic strength is being recognized and they’re gaining greater influence in world organizations that affect monetary policy.

You may remember that over the years the G6 (Group of Six, Richest Nations of the World) became the G7 which then became the G8.*

The G8 group, for all practical purposes is being replaced by the G20.*  At the same time voting power in organizations such as the International Monetary Fund and the World Bank is being reallocated to reflect the greater influence of these emerging economic powers. (The incredible power and global success of capitalism.)

Benefiting The 401k Investor

Since 2003 many 401k Investors have made and lost in big ways by speculating in Latin America* or other Emerging Market Funds.

But now increasing credibility and stability may be coming to this part of the market as they officially take their place as a legitimate world powerhouse and economic engine.

Stability is the key word for long term investors like those with a 401k.  Should you consider allocating more of your money in these areas?

Here are some videos to help you make and time these decisions:

Emerging Markets Outlook*

From CNBC.com*

G20 Agree on Voting Power Shift in IMF*

From CNBC.com*

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

401(k)s Are Up, Our Prices Are Down…

“Savor The Good Things While You Can,” is an excellent life motto and this is an excellent time to do just that.

This year’s market rebound since early March has been amazing and relentless.  Since March 6^th we’ve seen Index increases of 48 to 76%.

Most funds have actually out performed the Indexes, turning in YTD numbers that rival what the Indexes have accomplished in the recovery alone.

YTD the Top 20, Delta 401k Stock Funds have returned between 50 to 70%.  Members who’ve been keeping their 401k in any of these funds have something to savor right now.

Members can View, Compare and Print the YTD Results from all the Delta Stock Funds here:  YTD Stock Funds

New Member Prices Fall

More Good News!  The 2-Year Membership Fee has dropped from 2 for $30, to 2 for $28.  Membership gives you a front row seat to where the action is!

New Member Sign-Up

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff 

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Your Health, Your 401k, Your Future…

“I’ll Never Afford Retirement!” It’s a very popular sentiment these days; as a result many people are not planning or seriously considering the possibility of their retirement.

Honestly though, most of us will eventually come to the point where we’ll need to retire.  So those who implement good plans now will be way ahead when their time comes.

Realities are changing but so are the possibilities.  Pensions don’t provide the means to “retire early” like they used to.  So instead of retiring in our 50’s, those who’ve been loyal to their 401k can look for a normal retirement in their 60’s.

In the 1950’s a retiree at 65 was expected to have 14 more years to live.  But now the 65 year old retiree is looking at about 19 years of retirement.

Check Out: Why Boomers Will Retire More Comfortably Than Their Parents  From US News and World Reports*

Discovering The Possibilities

Geographic Mobility is one of the many things that work in favor of modern day retirees.  The cost of living varies widely from state to state and even city to city. 

Settling down in an area with lower cost housing and taxes can greatly increase your ability to live comfortably.

10 Affordable Places to Retire

Boost your retirement prospects by picking a low-cost locale 

By Emily Brandon, US News and World Report

…there's a lot you can do to boost your retirement prospects by picking a low-cost locale. There are plenty of places where you can scale back your cost of living without reducing your quality of life. If you move to a city with a lower cost of housing than where you live now, it's a quick boost to your nest egg.

Here are 10 very affordable places to retire:

• Binghamton, N.Y.
• Chattanooga, Tenn.
• Cocoa, Fla.
• Eau Claire, Wis.
• Montgomery, Ala.
• Omaha, Neb.
• Pittsburgh, Pa
• Roswell, N.M.
• San Antonio, TX
• South Bend, Ind.
• Check Out: Communities Near You

Read It All:  10 Affordable Places To Retire*

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

‘Tis The Season For Correction…

Long-term Investors know that when markets trend up over time they always come to a place where overall confidence begins to weaken.  At that point a correction is usually not far away.

Very simply, market advances and the resulting corrections are like those fizzy bubbles that fill up the glass when you’re pouring a cola or root beer.  They quickly bubble to the top and it would seem that you have a full glass. 

But wait a just minute and they’ll retreat, revealing that in reality there was less real substance and actually plenty more room to keep pouring the good, “real thing” in there.

Since there’s a good bit of “fizz” on top of market rallies, long-term Investors try to stay focused on overall trends rather than short-term jumps and dumps.

This Year’s Rally

The trends have been good.  On the 31^st of August the S&P 500 was up over 50% since its low at the beginning of March.  Small-Caps enjoyed a 66% increase while Mids were up 61% during the same time period.

Just how much fizz is mixed in with the real stuff in this rally may become clearer to us in the next couple of months.

Investors brace for a rough fall

S&P strategists expect 7%-8% setback as market enters cruelest month

By John Spence, MarketWatch.com*

BOSTON (MarketWatch) -- After a powerful rally in stocks from their March lows, nervous investors are positioning for a September sell-off -- something that many say is overdue.

Investors are wondering whether September "will live up to its reputation as the month in which the S&P 500 posts its worst price performance and frequency of decline," said Sam Stovall, chief investment strategist at Standard & Poor's Equity Research, on Monday.

S&P's chief technical strategist, Mark Arbeter, thinks the S&P 500 could fall as low as 940 before continuing its advance to a fresh recovery high. (S&P 500 was at 1007 on 09/04/09)

The S&P 500 has retraced a gain of more than 50% since the market touched bottom in March.

Since 1929, the S&P 500 has delivered its worst performance of the year in September, losing 1.3% on average, compared with an average monthly advance of about 0.5%, according to Stovall. He said S&P's investment policy committee believes stocks "are due for a period of consolidation" before resuming their advance.

Read It All: Investors brace for a rough fall*

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff 

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

Finally… Their Gone!!

For Seven Months We Endured Two Very Unwelcome Guests, Panic and Volatility.  They were literally devouring our 401k along with our retirement hopes and dreams.

Finally at the end of March they left!  So we’ve now had five months of relative calm, optimism and sanity.  This is the type of environment that the long-term 401k Investor relies on and we’re Sooo Relieved to see it return.

See The Picture Of Panic And Calm Here: S&P 500 Graph*

We will keep in mind though, that this panic really set in during September of last year and here we are, September is upon us again.

For some reason the 3^rd Quarter can turn negative (6 out of the last 10) and the September/October months are often to “blame”.

One of the many, many, many factors that weighed heavily upon the Markets during this past panic was that we had a new, untested leader of the Federal Reserve, Ben Bernanke.

So with relief we note that Ben will be nominated for a 2^nd term as Fed Chairman, hopefully keeping economic policy stable for the time being.  Instability is not our friend!

Bernanke's Low-Rate Fed Future Is Secure* BusinessWeek.com

Bernake’s Interesting Bio* (A near perfect SAT score, Harvard and MIT Grad. and Employee of “Pedro’s” South Of The Border in SC.)

But What About The Growing Debt??

May of us are very concerned about our country’s growing debt to other nations and the economic affect it may have.  Why aren’t Federal Reserve Regulators and Wall Street Investors panicking about that??

Well, here is a very interesting quote from the Bernanke/BusinessWeek.com article linked above:

“…while the U.S. government is borrowing much more, consumers are borrowing so much less that the nation's net borrowing from the rest of the world has actually been decreasing—thereby relieving downward pressure on the dollar.”

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff

 * Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice.

Reported performances of the past are not a prediction or guarantee of future returns.

And The Good News Is…

It’s No Secret That The Biggest Economic Engine Of Our Economy is Real Estate.  If we don’t get that engine going then our country’s prosperity will go no where.

So it’s with a glad sigh of relief we greet the news that housing resales are trending up in a strong way:

Resales have gained for four consecutive months, the longest streak of increases since 2004. "Momentum is building," said Lawrence Yun, The National Association of Realtor's chief economist.  MarketWatch.com*

Granted this does not directly indicate renewed health in Real Estate Construction itself but we absolutely need the surplus of existing houses to be resolved before housing construction can get its engine going again too.

Good Time To Update Your 401k??

Cashing out of clunkers

By Chuck Jaffe, MarketWatch.com*

Alas, the criteria for a clunker of a fund aren't set in stone, like the rules the government uses to determine what qualifies for a trade-in. That's why investors should see if their funds have any of the earmarks of a clunker; if your fund behaves like a gas guzzler and drives like an old beater, turn it in for something better.

1. It can't keep up with traffic

You don't need the fastest car on the road, but your investment vehicle needs some pick-up. If your funds can't keep pace with their benchmarks -- a minimal standard for doing the job you picked them for -- you're falling behind, and it will take you longer to reach your financial destination.

One measure of whether your fund can keep up: See if the fund lost more than its benchmark during the market's down slope (early October 2007 through early March of this year), and has lagged its index on the way back up (performance since March 9). If it has, you've got one of the worst investment vehicles on the road.

2. It guzzles your gas

Cash for clunkers is all about turning in cars with low fuel efficiency for newer models that are more fuel-friendly. In mutual funds, your money is the fuel and the expense ratio is your miles per gallon.

In this case, lower is better. The average expense ratio for a stock fund is roughly 1.4%; it's 1.0% for a bond fund. If there is nothing to justify the bigger price tag -- what is the fund doing that you are willing to pay extra to get? -- look for something that is more efficient with your financial fuel.

3. It needs constant engine repairs

The manager is your fund's power plant. If the manager keeps changing engines, you could wake up one morning to find that the big V-8 you bought has been replaced by two hamsters running on a wheel trying to make things go. Manager change is always a worry, but excessive turnover is a problem; good funds don't go through three managers in a decade.

Read It All: Cashing out of clunkers*

Wishing You The Very Best Of Returns,

The Fed’s Funds Staff

* Included source links and/or logos serve only to further viewer research and in no way indicates any endorsements, sponsorships or relationships. No accuracy guarantee of their content is implied.  This information is not presented as legal, tax or financial advice. 

Reported performances of the past are not a prediction or guarantee of future returns.

Reported performances of the past are not a prediction or guarantee of future returns.

“Stupid Investment” Of The Week…

Many Investors are still in their bomb shelters too shell-shocked to face the light of day and the risk of the Market.  Whether we are ready or not, the Market is returning to normal patterns with an upward Bullish trend.

Stupid Investment of the Week 

Time to cash out of low-yielding money-market funds

By Chuck Jaffe, MarketWatch.com* senior columnist  7-24-09

BOSTON (MarketWatch) -- All too often in investing, running with the herd will get you trampled.

But if you are an investor in money-market funds, heading for the exits with the masses is probably a smart idea right now, because investing in money funds is the Stupid Investment of the Week 

The list of funds currently earning zero percent is so long that fund tracker Lipper Inc. must list hundreds of funds as the laggard in their peer groups because they aren't making a cent.

Fund firms are waiving expenses to ensure that returns don't go negative, but the truth is that plenty of funds are keeping every ounce of positive return for themselves. The average fund, according to iMoneyNet, has an expense ratio of 0.32%; investors are lucky to get pennies.

No Sense

With interest rates at record lows and officials like Federal Reserve chairman Ben Bernanke saying that that rates are unlikely to move sharply for at least nine months, money funds are less an investment than a parking space.

Stupid Investment of the Week showcases the concerns and conditions that make an investment less than ideal for the average investor; while obviously not a buy signal, neither is this column intended as an automatic sell recommendation.