Monthly vs. Yearly IRA Contribution Experiment - April 2012 Update

The Monthly vs. Yearly IRA contribution timing experiment April 2012 update.

Yearly Contribution Roth IRA

Fund	Shares	Price	Cost Basis	Market Value	Gain/Loss	Gain/Loss %
VTSMX	102.74	34.96	3,264.33	3,591.80	327.47	10.03
VGTSX	93.07	14.36	1,250.00	1,336.56	86.56	6.92
VBMFX	46.00	11.04	505.09	507.83	2.74	.54
	Totals:		5,019.42	5,436.19	416.77	8.30

Account Summary :

04/30/2012 – Reinvested $1.13 dividend for Vanguard Total Bond Market Index Fund

Fund	Shares	Price	Cost Basis	Market Value	Gain/Loss	Gain/Loss %
VTSMX	32.31	34.96	1,086.76	1,129.61	42.85	3.94
VGTSX	29.20	14.36	416.66	419.32	2.66	.64
VBMFX	15.24	11.04	167.73	168.23	.50	0.30
	Totals:		1,671.15	1,717.16	46.01	2.75

Account Summary :

04/01/2012 – Contributed $416.66
04/02/2012 – Purchased mutual funds
04/30/2012 – Reinvested $0.37 dividend for Vanguard Total Bond Market Index Fund

Account	Gain/Loss %	% Change From Prior Month
Yearly	8.30	-0.77
Monthly	2.75	-0.94

Analysis :

The U.S. markets gave up some gains at the beginning of the month due to worries about European debt. Some of the losses were recovered toward the end of the month.
European bond default worries were in the spotlight. Notably, Spain’s long-term credit rating was downgraded once again by Standard & Poor’s. The news dragged down foreign markets.
A lot of investors poured money into bonds. Junk bonds, bonds with high-yields and higher risk of default, got the most attention.
The Yearly Contribution IRA rate of return remains higher due to the lump-sum investment at the beginning of the year.
The Monthly Contribution IRA is suffering from large market swings. The gains in the portfolio decreased by 45%.