Update On My IRA Account

If you haven’t noticed, the stock market has been doing very well lately. It has had a few ups and downs in the past 8 weeks, but overall, it has performed great in 2009. My IRA took a strong dive in 2008 like many others, mainly because I did not have it properly diversified. I had everything in very aggressive growth stock mutual funds in a 401(k) with my former company. Once I left that company, I rolled the money into an IRA, and since the amount was not too signficant, I decided to experiment with Exchange Traded Funds.

Here is a list of the funds I currently hold:

XLF: Financial Sector SPDR Index
IVV: iShares S&P 500 index ETF
IGE: iShares S&P North American Natural Resources
IYR: iShares Real Estate Inv. Trust
VIG: Vanguard Dividend Appreciation
VWO: Vanguard Emerging Markets
BND: Vanguard Total Bond Market

Now, here are the gains and losses for each fund since I purchased them in February of 2009. (expressed in terms of percentage)

  1. XLF: 62%
  2. IGE: 29%
  3. IYR: 25%
  4. IVV: 21%
  5. VIG: 17.75%
  6. VWO: 16%
  7. BND: (3.8%)

The total percentage gain of the portfolio thus far is 28.25%. Obviously, buying XLF has paid off nicely, and it was a big gamble, but I was pretty confident that the financial sector was highly undervalued at the beginning of 2009. I am pleased with the performance so far, and I anticipate the Dow and S&P to close close to 10,000 and 1,000 by the end of the year. Don’t quote me on that, but it’s just a gut feeling that I have. The bond market fund is simply there as a hedge against inflation. I chose the natural resources fund and real estate, because like the financial sector, they too had huge hits in 2008, and I expected them to make a recovery in 2009 and 2010.

If you have any questions for me about this portfolio, please feel free to make a comment below!