Retirement Income

Comments

Post a Comment

Popular posts from this blog

My first ever dabbling in buying on dip during 2022 market downturn turned out to be quiet exciting endeavor

Image
Wow!!! My first ever dabbling in buying on dip  during 2022 market downturn turned out to be quiet exciting endeavor. I primarily bought iShares Semiconductor ETF (SOXX). Let me share my experience from this experiment. Since I don't do market timing in general, I was not sitting on any cash for such buy on low exercise. Rather I used borrowed  funds from HELOC at prime minus 1% (3% average APR during last year) rate. I kept buying little bit on dip each time SOXX went down by 8%. As SOXX dropped around 36% last year, I ended up buying for around 80K. So far, with spectacular recovery of semiconductor sector this year, this experiment has generated almost 20% gain on my investment in it. My plan is to start selling SOXX slowly as it reaches it's record high in near future and keep selling for each 8% increment thereafter. Idea is to slowly pay off HELOC and then repeat this excercise again during next market correction/crash.  Glad to see my first buying on dip experimen...
Read more

iShares Semiconductor ETF (SOXX) - Passive fund Based on Semiconductor technology index

For those considering a tilt  to specific technology  asset class in their portfolio, high PE of this asset class is always concerning. However, to my utter surprise, semiconductor  technology specific passive   iShares Semiconductor ETF (SOXX) happens to have dirt cheap  PE of merely 21 (as compared to 29 for technology heavy NASDAQ 100 - QQQ). Also, amongst all the technology asset class non leveraged etfs , SOXX performance is almost  number one  for all 1, 3, 5 years horizon. With dividend yield of over 1% and projected earnings growth of 17%, this ETF is projected to generate 1+17=18% annual return for next 5 years. It invests into ICE Semiconductor Sector Index which is primarily based on top 30 (based on market cap) global semiconductor companies. It's expense ratio of 0.43% is little bit on higher side. However, it's still one of least expensive focused technology index ETF.
Read more

How to know if one is fully funded for retirement using Safe Withdrawal Rate approach

  If one's retirement portfolio is more than 22 times of their net retirement expenses (net is after adjusting for social security income), such retiree in essence has overfunded portfolio. If portfolio is 50% or more overfunded (say more than 33 times of one's net retirement expenses), such retiree does not have risk of running out of money, even if faced with significant portfolio drop during initial years of retirement. This allows such retiree capacity to go for more calculated risk such as potentially all stock portfolio without worrying about outliving their portfolio. Following excerpt from above referenced Bengen safe withdrawal study illustrates that decently overfunded (say 50%-100% overfunded) investor could potentially accrue several times of initial portfolio value if they are willing to leverage their capacity of 100-percent stock portfolio: "Can you imagine how much wealth would have accrued to an investor who had a 100-percent stock portfolio o...
Read more