Join Early Retirement Today
Reply
 
Thread Tools Display Modes
Portfolio Allocation feedback requested
Old 04-21-2007, 04:48 AM   #1
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2007
Posts: 5,072
Portfolio Allocation feedback requested

We will ER in 4+ years. I am rebalancing and targeting a 60/40 allocation slice and dice approach in general. There is more to my overall approach, but this is a general target for the overall portfolio @ 55. I will probably get a little more conservative as we age...

I am currently at 70/30 and intend to use additional funds that are added (via wages), gains/divs thrown off in that taxable account to help rebalance, The rest will be moved in tax deferred accounts to bonds. The bonds are in mutual funds. Mostly in intermediate term. A small amount in tips and LTB.

However, my equity alloc looks like it could be tuned. Here are my current holdings. Most all are low fee funds.

S&P 500 Index 50% (1/3 of this is actually an individual Blue Chip that cannot be sold till DW retires)
Mid Cap 400 Index 7.3%
Small Cap Growth Index 3.3%
Foreign (mix of funds) 8.7%
REIT 1.4%



I have looked at the coffee house allocation. It seems to be a a little aggressive in the Small cap and REIT allocations.... But maybe it is the right way to go.

As I move toward my overall target... what would you recommend in terms of target equity allocations for the 60% of the total portfolio?


chinaco is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: Portfolio Allocation feedback requested
Old 04-21-2007, 05:29 AM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 10,252
Re: Portfolio Allocation feedback requested

My 2 or 3 cents for you:
Many of the slice & dice stuff that I have read suggests a slight value tilt, a 30% to 50% foreign allocation, and as many small caps as large caps. Your AA is not consistent with any of these. Some places to read up on all this are at www.fundadvice.com and Bernstein's The Four Pillars of Investing.

You can get exquisite help on AA at www.diehards.org where folks will practically manage your portfolio for you for free.

Specific suggestions: Increase foreign to at least 30% of equities, use the new Vanguard all-World, ex-US fund or ETF VEU. Use small cap blend index, not the growth index and increase it to at least 20% of equities (remember the international will have small caps as well).
LOL! is offline   Reply With Quote
Re: Portfolio Allocation feedback requested
Old 04-21-2007, 10:42 AM   #3
Recycles dryer sheets
Milkman's Avatar
 
Join Date: Apr 2007
Location: Longmont, CO
Posts: 90
Re: Portfolio Allocation feedback requested

Chinaco:

I like the Coffeehouse portfolio too and shared some of your misgivings about the REIT portion. What I have done for the past two years is add Natural Resource and Gold to the "Specialty" portion of my portfolio. I have REITs (6%), Natural Resources (6%), and Gold (3%). Each of these can be volatile if looked at individually, but together have a tendency of smoothing out the volatility of the entire portfolio. Over the past two years I have had my own portfolio and my wife's in this strategy and we have both been pleased with the results.

Like you we are in a 70/30% mix with 3-5 years to go until retirement. I use almost an entirely EFT index and rebalance once a year when I make my Roth IRA contribution.

Milkman
Milkman is offline   Reply With Quote
Re: Portfolio Allocation feedback requested
Old 04-21-2007, 10:49 AM   #4
Recycles dryer sheets
 
Join Date: Jul 2005
Posts: 423
Re: Portfolio Allocation feedback requested

I also would switch the Small cap growth to small cap value, to get the value premium. Also, I think someone has done a study and said anything less than 5% has a negligible difference on your portfolio, so I would bump the small cap up to at least 5% and add more intl (but that is just me, as much of the world is outpacing the US right now).

In general you are not far off from most people, I can't imagine.
Olav23 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Portfolio Allocation Advice dreamcast Hi, I am... 18 07-28-2007 06:42 PM
Feedback on my income/growth portfolio BD1 FIRE and Money 4 07-10-2006 07:00 PM
Comments on Portfolio Allocation veritasophia FIRE and Money 18 04-14-2006 05:08 PM
Portfolio allocation calculator Mysto FIRE and Money 2 04-03-2006 06:30 PM
Opinions On This Allocation Requested Bob_Smith FIRE and Money 1 12-22-2003 04:13 AM

» Quick Links

 
All times are GMT -6. The time now is 08:15 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2024, vBulletin Solutions, Inc.