Monthly vs. Yearly IRA Contribution Experiment - May 2012 Update

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

Yearly Contribution Roth IRA

Fund	Shares	Price	Cost Basis	Market Value	Gain/Loss	Gain/Loss %
VTSMX	102.74	32.78	3,264.33	3,367.82	103.49	3.17
VGTSX	93.07	12.77	1,250.00	1,188.57	-61.43	-4.91
VBMFX	46.10	11.12	506.22	512.64	6.42	1.27
	Totals:		5,020.55	5,069.03	48.48	0.97

Account Summary :

05/31/2012 – Reinvested $1.13 dividend for Vanguard Total Bond Market Index Fund

Fund	Shares	Price	Cost Basis	Market Value	Gain/Loss	Gain/Loss %
VTSMX	40.02	32.78	1,357.59	1,311.89	-45.70	-3.37
VGTSX	36.44	12.77	520.82	465.33	-55.49	-10.65
VBMFX	19.06	11.12	209.87	211.92	2.05	0.98
	Totals:		2,088.28	1,989.14	-99.14	-4.75

Account Summary :

05/01/2012 – Contributed $416.66
05/01/2012 – Purchased mutual funds
05/31/2012 – Reinvested $0.47 dividend for Vanguard Total Bond Market Index Fund

Account	Gain/Loss %	% Change From Prior Month
Yearly	0.97	-6.75
Monthly	-4.75	-6.78

Analysis :

There was a huge market sell-off in May. “Sell in May and go away” really sounds like good advice when looking back at last month’s performance.
Fears of Greece possibly exiting the euro zone and news of Spain bailing out a major bank drove markets around the world lower.
The jobs report for May was disappointing for investors on the last trading day of the month. Confidence of a recovering economy faltered when the unemployment rate increased to 8.2%.