Monthly vs. Annual IRA Contribution Experiment - October 2013 Update

The Monthly vs. Annual lump-sum IRA contribution timing experiment October 2013 update.

Annual Contribution Roth IRA

Fund	Shares	Price	Cost Basis	Market Value	Gain/Loss	Gain/Loss %
VTSMX	203.61	44.52	6,960.79	9,064.72	2,103.93	30.23
VGTSX	188.71	16.59	2,707.67	3,130.70	423.03	15.62
VBMFX	104.36	10.69	1,150.16	1,115.62	-34.54	-3.00
	Totals:		10,818.62	13,311.04	2,492.42	23.04

Account Summary :

10/31/2013 – Reinvested $2.38 dividend for Vanguard Total Bond Market Index Fund

Fund	Shares	Price	Cost Basis	Market Value	Gain/Loss	Gain/Loss %
VTSMX	174.55	44.42	6,331.40	7,753.45	1,422.05	22.46
VGTSX	167.28	16.67	2,451.51	2,788.59	337.08	13.75
VBMFX	93.63	10.72	1,028.39	1,003.75	-24.64	-2.40
	Totals:		9,811.30	11,545.79	1,734.49	17.68

Account Summary :

10/01/2013 – Contributed $458.33
10/01/2013 – Purchased mutual funds
10/31/2013 – Reinvested $2.13 dividend for Vanguard Total Bond Market Index Fund

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AccountGain/Loss %% Change From Prior MonthAnnual23.043.73Monthly17.683.69

Analysis :

The Federal Reserve is continuing with its bond purchasing program. That decision was rejoiced by investors.
Housing sales have weakened, and mortgage rates have fallen slightly with demand.
Corporate earnings have slowed, but stock earnings exploded in October. Indexes kept peaking at new highs, only to settle on the last trading day.
Tech IPO’s continue to rock the market. I can only say, don’t get involved in the hype. Let indexing work for you.
The Annual Contribution IRA has benefited from recent market performance, pushing its gain percentage ahead of the Monthly Contribution IRA. However, as evidenced by the Total Bond Market Index Fund, monthly purchases seem to help mitigate losses.