Target Corp. 401k Plan PSDS Scan 12-31-2010

The Target 401k made a few changes last year in the core investment options but the Balanced portfolio remains a lifeboat portfolio. The employee portfolio largest holding is still company stock TGT at 39.2% of the plan assets. Plan performance this year is a little below average. In the scan this year I included their stable value investments and their GIC. These two Plan assets are not participant directed options as I read the SEC 11-k report. There is a self directed account option available in the Plan.

Regions Financial Corp. 401k Plan PSDS Scan 12-31-2010

The Regions Financial 401k was hurt by company stock RF which has a negative 5yr APR of -23.44% and the employee portfolio largest holding is the stock. Their 5yr APR is also negative at -2.05%. The Balanced portfolio has a 5yr APR of 5.74% with a Sharpe ratio of 1.40. This is about average for hundreds of 401k plans. The Balanced portfolio largest holdings are 2 bond funds and the stable value fund. I hope employees understand that volatility kills compounding. In the last 5 years before retirement losing more than 20% each year in company stock is not prudent.

World ETF Portfolio Sharpe Index to 12-1-2011

The R&D background information for this Index can be found in the 2011 White Paper "World ETF Sharpe Index" at the web site psdscanner.com. This is still a work in progress at the "White Bird" stage of development. The chart posted here will be updated monthly as the prototype continues flight testing. Early results have already established that Sharpe ratio data should be updated quarterly even though the ETF market data are updated monthly. The Standard & Poor's "Index Mathematics Methodology" ,February 2009 edition, was used in general for this work and in particular the chapter on Fund Strategy Indices.

Springfield Foods 401k Plan PSDS Scan 12-31-2010

The last scan of the Springfield Foods 401k was in 2008. The Balanced portfolio still has no company stock SFD, which still has a negative 5yr annualized return. The largest holdings of the Balanced portfolio are PTTRX, WFSRF, STVSX and STMSX. The employee portfolio largest holdings are WFSRF, SFD and a 2020 target date retirement fund STTRX. Interesting. This small plan has about average performance and a company stock that has performed poorly for more than 5 years,

Union Pacific 401k (RTP) Plan PSDS Scan 12-31-2010

This Union Pacific 401k Plan is vintage 2004 and does not have target date retirement TDR funds. The Union Pacific Fruit Express scan of 12-31-2009 does have Vanguard TDR funds and as far as I know Vanguard is the trustee for all these funds. This plan has two investment catagories; LifeStrategy Funds and Core Funds. The LifeStrategy Funds VASIX, VSCGX, VSMGX and VASGX are Pre-Mixed funds. The Core Funds are VMMXX, VRST (stable value fund), VBMFX, VWELX, VWNFX, VFINX, VTSMX, VWUSX, VMCIX, VSCIX, VWIGX and company stock UNP.

In many scans including this one the stable value fund has such a high Sharpe ratio the Balanced portfolio is too conservative for many younger employees. I selected one of the portfolios in the scan between the Balanced portfolio and company stock as a "Moderate" portfolio with more company stock and a good Sharpe ratio they may want to consider. That portfolio has 55% in UNP, 20% in VMMXX, and 5% in VBMFX, VWIGX, VMCIX, VSCIX, and VWUSX. As a student over fifty years ago loading Pacific Fruit Express cars each summer it would have been my choice but not today.

Waddell & Reed 401k (TP) Plan PSDS Scan 12-31-2010

The Waddell & Reed 401k was last scanned with 2008 market data and company stock WDR was definitely not in that Balanced portfolio. The 401k has 17 Waddell & Reed investment options and 22 Ivy fund investment options but no target date funds. This year the Balanced portfolio has a little WDR but the largest holding is WLTAX an Ivy limited term bond fund at 12.7% of Plan with less than 5% in company stock. The employee portfolio largest holding is UNASX an asset allocation fund with WDR one of their top 3 holdings. A good 401k with an unusual collection of investment options.

A Model Conservative ETF Portfolio PSDS Scan 9-30-2011

The Model Conservative ETF Portfolio in this scan was mentioned by Morningstar's Christine Benz in a talk to the AAII LA Chapter last Saturday. It was published in April of 2011 online at http://news.morningtstar.com in her paper "A Conservative ETF Portfolio for Retirees". It is similar to an earlier Morningstar model for an in-retirement mutual fund portfolio that was scanned 12-21-2010.

Several of the ETF funds in the portfolio do not yet have 5-year data so this scan is for a 3-year period using market data from Thomson Reuters. As the 3D scan image shows the Model portfolio and the Balanced portfolio are similar but with differences. In the scan cash is represented by the 3-Month Treasury Bill ETF, BIL, which has 3-year data. The use of ETF funds in retirement portfolios is timely, I have a few in a Roth IRA and there are advantages. Thanks Morningstar for supporting AAII and retirees with quality financial data services and people like Christine Benz and W. Scott Simon.

USC 401k (RSP) Plan PSDS Scan 12-31-2010

The USC (University of Southern California) 401k Retirement Savings Plan provides 4 options from major mutual fund companies and an insurance company; Fidelity, Prudential, TIAA-CREF and Vanguard. This scan is for the Prudential option. In the scan the Prudential Guaranteed Interest Account is GIC.ekx and it is the largest holding of the Sharpe ratio balanced portfolio. A uniform asset allocation portfolio is provided for comparison purposes, as I have no information on the employee asset allocation. The Balanced portfolio has an above average 5yr APR = 6.85% with a Sharpe ratio of 1.86. The largest equity holding of that portfolio is the Oppenheimer Developing Markets Fund with 4.9% of the portfolio. A good Plan choice with all but one of the Prudential options in the Balanced portfolio.

CUBIC Corp. 401k (RP) Plan PSDS Scan 12-31-2010

The CUBIC 401k Balanced portfolio was up over last year as company stock CUB jumped to a 5yr APR of 19.43% with a Sharpe ratio of 0.411. However, it remains a lifeboat portfolio with only five investment options having 5% or more of the Plan invested in them; the stable value fund, the GIC and three bond funds PTTRX, CPTNX and TPINX. Company stock is very volatile and the Balanced portfolio invested only 3.7% of the portfolio in the stock and the employee portfolio also invested less than 5% in the stock. A good plan with an above average 5yr APR of 6.06% and a high Sharpe ratio. The high Sharpe ratio is thanks mostly to the GIC and stable value fund.

Nordstrom 401k (SP) Plan PSDS Scan 12-31-2010

The Nordstrom 401k 5-year performance was down a bit compared to last year because company stock JWN while up in 2010 was not up as much as it was in 2005; volatility at work. The Balanced portfolio 5yr APR was 5.50% with a Sharpe ratio of 1.60 and it invested less than 1% in the stock which continues to be the employee portfolio's largest holding. In the scan this year I added a proxy PASAX for the SMA funds in the plan called Nordstrom select funds; conservative, moderate and growth. I am not sure if they are participant directed investment options but they are over 30% of the plan as I read the SEC 11-k report. All in all a pretty good Plan and a very volatile company stock.

Nordson Corp. 401k (ESTP) Plan PSDS Scan 12-31-2010

The Nordson 401k Plan was again helped by company stock NDSN and performance improved slightly over last year. The Balanced portfolio and the employee portfolio largest holding is still the GIC but less so than last year. The Plan 5-year Balanced portfolio performance APR = 5.88% is about average and a Sharpe ratio of 1.23 is above average. The Plan has no target date retirement funds, which is fine, but a conservative allocation fund (has some gold) like PRPFX would help in my opinion.

Wisconsin Energy 401k (ERSP) Plan PSDS Scan 12-31-2010

The Wisconsin Energy 401k Plan performance improved over last year and continues to be helped by company stock WEC. The Balanced portfolio invested 8.5% of Plan in the stock and the employee portfolio invested 26% of that portfolio in the stock. Their investments greater than 5% of Plan were WEC, FFRHX, FDGRX, MEIJX, FDIVX, FLPSX, FBALX and FUSEX in the scan. Of these only WEC is in the Balanced portfolio investments greater than 5% of Plan. Interesting. The Plan has several good investment options and average performance the last 5 years.

Talbots 401k Plan PSDS Scan 12-31-2010

Talbots 401k Plan was last scanned in 2008 and frankly I thought it would be the last but they are still in business. The Balanced portfolio invested no money in the stock which has a 5yr APR = -16.85% with a negative Sharpe ratio. The employee investments over 5% of Plan do not include the stock TLB either. The 401k Plan however has an above average 5yr APR = 6.09% with Sharpe ratio of 1.35. In the scan the common collective income trust RSTV is represented by VRST the Vanguard retirement savings trust. This is a good 401k plan with above average performance. My only suggestion is eliminate the redundant under performing funds to reduce employee portfolio selection risks.

RALCORP HOLDINGS 401k (SIP) Plan PSDS Scan 12-31-2010

The RALCORP 401k Plan was helped again this year by company stock RAH and the Balanced portfolio invested 9.8% of the portfolio in the stock. The employee portfolio's largest holding is the stock at 15.2% of Plan. That produced a 5yr APR = 5.0% and a positive Sharpe ratio. This continues to be a good plan of mostly Vanguard funds and a good company stock the last 5 years.

Canadian Imperial Bank of Commerce 401k PSDS Scan 12-31-2010

This Canadian bank 401k Plan Balanced portfolio was helped a little by company stock CM and invested 2.9% of the portfolio in the stock. The Plan has several good investment options and most are in the Balanced portfolio. The employee portfolio invested 9.6% of their portfolio in company stock but their largest holding was VFINX and less than 5% was invested in the stable value fund VRST in the scan. Interesting. However, like many 401k plans it could use more diversification than Target Date Retirement funds provide.

Chicago Bridge & Iron 401k (SP) Plan PSDS Scan 12-31-2010

The Chicago Bridge and Iron 401k was not helped by company stock because of its high volatility. The stock CBI has an average 5yr return over 40% but the annualized return is less than 6%. The Balanced portfolio 5yr APR = 4.81% with a Sharpe ratio of 0.36 and both are a little below average. The employee portfolio 3 largest holdings are TRBCX at 9.6%, the stable value fund SVF.hpx in the scan at 8.7% and TRBCX also at 8.7% of Plan. T. Rowe Price is the trustee. This is a well diversified 401k plan with a very volatile company stock the last 5 years.

CVS Caremark 401k Plan PSDS Scan 12-31-2010

The CVS 401k Plan Balanced portfolio return improved a bit over last year with a 5yr APR = 5.86% and a Sharpe ratio of 1.69 and it includes company stock CVS. The employee portfolio largest holdings are the stock CVS at 12.7% of the portfolio then VINIX at 11.5% and the stable value fund SVF.hpx at 11.2% in the scan.There were a few small changes in the plan compared to last year that were helpful. All in all a good 401k plan with pretty good diversification that a good Sector fund could help improve.

Cardinal Health 401k (SP) Plan PSDS Scan 12-31-2010

The Cardinal Health 401k Plan has been involved in litigation more than most. The current SEC 11-k report provides data only at the investment category level. The Plan trustee, I think, is Fidelity. The investment options in the scan are my best effort pieced together from web sources and court documents. The Balanced portfolio has a 5yr APR = 4.96% with a Sharpe ratio of 2.50. This portfolio and the employee portfolio both have the GIC as their largest holding which explains the high Sharpe ratio and modest return. Company stock the last 5 years has a negative annualized APR = -3.56% and is not in the Balanced portfolio. It is 8% of the employee portfolio according to the SEC 11-k report. This plan is small and a little below average in performance. On a positive note company stock CAH has done well the last couple of years.