Portfolio Rebalancing & 2006 Outlook
The last few weeks have been spent closing the books on my personal accounts as well as my 4 business ventures. End of the year is always a fun time! However, I'm back and have been working on my yearly retirement portfolio rebalancing and reallocation. I'm not changing too much but I did place a trade today. I have been bantering for awhile regarding large cap technology stocks and how I might integrate them into my portfolio at a higher level. I finally decided to use QQQQ for that purpose. I'm convinced it has broader coverage than XLK at this point.
Here's how my portfolio (retirement only) looked before and after today's trade:
As you can see, I've tried to push it more into domestic equities, particularly into the large growth corner of the grid. With that done, I can comment a bit on the other areas.
I continue to believe that International is going to be the growth engine for the foreseeable future. It's a big world out there. My core holdings are AEMGX (+117% in 2 years), OAKIX (+52% in 2 years), and FDIVX - the latter being all I can get from my limited 401(k).
I hold a broad spectrum of US equity funds as well. There are too many to go into here, but most are valued-oriented. That's why I wanted a more growth-oriented new purchase which I met with QQQQ.
My commodities holdings are really derivatives through PCRDX. I like the diversity that offers because commodities have little correlation to stocks and bonds. My rare coins were purchased from a private dealer about 1.5 years ago. These are just buy and hold investments for me for the long term. Every few years I get another one and hold them.
One problem I have is all bond funds are heavily weighted in short term investments due to the inflationary environment. This is prudent, but overweights my portfolio in cash. I try to combat this by not having money market holdings. For the rest I trust the experts. However, it is my goal to have my entire bond allocation actually in bonds. My two funds in that area are LSBRX and PTTDX.
Overall, I'm happy where I am. One hole is real estate and I'm looking at REIT options (I don't own a home so I'm completey underexposed here). I believe commercial RE has room to run in 2006 but residential may be topped out.
My wife and I are 28 with our entire careers ahead of us so our time horizon is long and we can tolerate the risk of this asset mix.
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Hi
Thanks for sharing your knowledge. :-)
I was look at your age and thought that it would be prudent for you to try and understand the very serious situation with the Energy picture not only for the US but the World.
Take a look here for more info on this issue
www.peakoil.com
I am a petroleum eng. so I will just say that the discussion on the Peak Oil issue is not some Doomsday-ers but people who basically have it right.
Regards
Henry
