Date: Fri, 25 Nov 2005 14:24:30 -0600
From: Tad Borek 
Newsgroups: misc.invest.financial-plan
Subject: Re: 401(k) contribution timing and performance
	iQBVAwUAQ4dy/vl/I4+O31e5AQHhFAH/d+PZ9vLKc/a5owV0Vk6ODwYhlp3QyG0k
	RaIhdMm+d6LRDQPCUsjoADhANHJuap+l9TSxOE+kjRD1e+ER6QSULg==
	=WH8X

Rich Carreiro wrote:
>>Yes, it does matter. The more money in the account at the time of the
>>distribution, the greater the distribution.
> 
> No, it doesn't matter.  Your second sentence, while true, is
> irrelevant.  Why do you think there's anything special about
> buying distributions?


I think Elle's point is that if you compare buying a fund in say Jan 
2005 to Dec 2005 (whether before or after a Dec 05 distribution)...the 
Jan 2005 buyer will earn more income from dividends/interest simply for 
holding the fund the full year. The Dec 05 buyer ends up behind either 
because he didn't receive income distributions during the year, or 
because he's buying shares at a higher NAV (attributable to the 
dividends/interest collected by the fund during 2005, but not yet 
distributed to shareholders).

And of course one week's fluctuation in the stock market can completely 
swamp this. The studies on this topic seem to illustrate the mundane 
point that in a stock market that, on average, rises over time, it's 
better, on average, to get your money invested earlier. With many 
exceptions that make periodic investing much better on the stomach, if 
not necessarily the wallet!

-Tad