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I am nearing retirement and a broker from a well known firm wants us to join his scheme for mutual fund investing of 401(k) funds.

He has developed a formula based on a moving average of the price of a given fund. The average is weighted and uses a period of several weeks' price history (he doesn't reveal how many weeks). He has a small group of favorite funds.

His formula produces a curve that lags the curve of weekly closing prices--the idea is to lag it but to not be either too close to or too far from it. The moving average curve, therefor, if ideal, crosses the price curve just behind turns in the fund price. When it crosses on the way down, he sells and stashes the money in a money market. When it crosses on the way up, he buys back in.

Given that I am too busy to track investments properly (and assuming that his choice of funds is appropriate), does handing my 401(k) funds over to a guy like this make sense? Is there a better way? (I realize this is not true Foolishness but
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I am nearing retirement and a broker from a well known firm wants us to
join his scheme for mutual fund investing of 401(k) funds.

He has developed a formula based on a moving average of the price of a
given fund.


Sounds like market timing. At your stage of the game I would not experiment with the broker.

Would be fund to ask him to show you the monthly statements (investor's name removed) for the last 10 years for several of his best clients.

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Greetings, RLGrant, and welcome. You wrote:

I am nearing retirement and a broker from a well known firm wants us to join his scheme for mutual fund investing of 401(k) funds.

He has developed a formula based on a moving average of the price of a given fund. The average is weighted and uses a period of several weeks' price history (he doesn't reveal how many weeks). He has a small group of favorite funds.

His formula produces a curve that lags the curve of weekly closing prices--the idea is to lag it but to not be either too close to or too far from it. The moving average curve, therefor, if ideal, crosses the price curve just behind turns in the fund price. When it crosses on the way down, he sells and stashes the money in a money market. When it crosses on the way up, he buys back in.

Given that I am too busy to track investments properly (and assuming that his choice of funds is appropriate), does handing my 401(k) funds over to a guy like this make sense? Is there a better way? (I realize this is not true Foolishness but


I gotta agree with rjm1 on this one. It's nothing more than a market timing ploy. Timing doesn't work for the pros on any consistent basis over time, so there's no reason it should work here, either. If you don't wish to pay attention to your investments, then IMHO you would be far better off just using an index fund like the Vanguard 500. However, if this strategy appeals to you, then I'd definitely like to talk to you about some ocean-front property I own in Arizona.

Regards….Pixy
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