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  1. #1

    Do PONDX allocation now?

    I have figured out my desired allocation and part of that is PONDX, which I currently have $25k in. Would it be prudent to invest the additional $40k allocation in it right now? Do a little at a time? All of it at once?
    If I buy all of it now that would give me 5475 shares, which @ .052 dividend would generate $284 per month. Looking at historic prices, $9-$10 per share isn't unlikely. Is losing $2 per share, $11k, an acceptable risk? Don't know if this is quite the right way to look at it but, possible loss is what I am trying to figure out. I don't know of an app that can model how this would look with re-investment over 3 years.

  2. #2
    I believe many studies say a lump sum buy usually wins over dollar cost averaging, but they assume the non-invested money was kept in cash earning nothing. You can do the math with your allocationand schedule.
    At the same time, if the market is falling, you will do better with DCA. Your guess is as good as mine as to how PONDX will do if the market tanks or if interest rates go up.
    Coincidentally, I bought PONDX in both my IRA and taxable account about 15 months ago. Three months earlier, I had never heard of it, but my interest was stoked by the constant discussion about PIMIX. So I am neither expert nor experienced here. Just had cash sitting around doing nothing. Decided to spend it. My stake is a little more than what you already own.

  3. #3
    I was bummed out when the principal dropped. I was down almost 90 cents/share in February, but it's now a 50 cents/share loss. Dividends have made up for that, so I do have a positive TR.
    I had looked at the dividend and PONDX was pretty steady in 2008-2009, even though the share price tanked. That was one of my reasons to buy it.

  4. #4
    If the money is in cash, just buy it now. If it is in something else, DCA in.

  5. #5
    All these numbers don't mean much because we don't know how much money you have and your goals and risk tolerance.
    PONDX never lost $2 on it's NAV. The worse loss was on 2007-2008 which was about 13%. This fund is very unlikely to lose 10% from it's last top except in extreme situations.


 

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