This plan is dominated by company stock CMP which has a 5yr APR = 32. 87% and with a 5yr average APR = 33.21%. That almost never happens. The company stock has a higher Sharpe ratio than the stable fund and the money market fund. This created a lifeboat like Balanced portfolio with the lifeboat being company stock. In my opinion the model recommendation is not prudent for a retiree. Putting 36.7% of your retirement portfolio in company stock is not prudent. I do own a small amount of CMP in a Roth IRA but own none in my IRA. The Balanced portfolio does have small amounts in vested in almost all the plan options. The employee portfolio as of 12-31-2009 had the stable value fund FMIP as its largest holding with only 4.44% invested in company stock. Interesting.
No comments:
Post a Comment