Posts tagged with "asset-allocation" - page 3
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Year In Review – 2020 Returns
At the start of every new year I review my portfolio and take stock of my expenses, returns and net-worth. So just like last year I am reviewing my returns for 2020. This is the first of the year in review series. I will also post my expenses and net-worth reviews in upcoming posts. Without wasting too much time, lets get right to it.
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Real Estate Investment vs Equity Investment
While you know my aversion to real estate investment in India, I don't discourage anyone from investing in it. If you don't mind the corruption related to property deals, you might make more than simply investing in equity and debt mutual funds. But before you decide which way to go, make some informed decisions. In this post I will try to simplify some calculations which can help you guide in the right direction. I will also mention some risks involved in each of those asset classes.
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My Corpus Reached All Time High And I am Worried
Just recently, my corpus has reached an all time high. I thought we are in the middle of a world wide pandemic. How come the markets don't seem to care? Agreed that I don't understand markets, but still, this is completely unreasonable. Various indices and stocks in India, as well as in the US, are hitting all time highs. But the economy is hurting. Where am I going wrong in my understanding? Well, there is nothing new happening really. Mr. Market has always been manic-depressive and probably will continue to be that way forever.
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Goal Based Investing
So far I have been giving financial advice for the singular goal of early retirement. But many of you probably have multiple goals. May be you want to buy a house, save up for kids education or planning an international vacation in a couple of years. Whatever might be your goal, you need to have a financial plan. Each goal needs to have a different corpus, asset allocation and redemption plan. If you rather watch a video on the same topic, check out the YouTube video at the end of the post.
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How Am I Handling the Market
Given the current market situation, a few of my friends wanted to know how my portfolio is doing and what have I been doing during the crisis. So this post should hopefully answer these questions. I want to preface by saying that don't be fooled by randomness. I may have performed better or worse than you expect and it does not mean I made any smart moves nor that I made mistakes. Only note that luck favors the prepared.
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COVID-19 vs Market
Have you seen the market lately? It has gone on a wild roller coaster ride. You get to read news like Sensex fell over 1500 points from the peak. Should you be concerned? Do you need to act on this news? Lets find out.
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Year In Review – 2019 Net Worth
The final post in 2020 Year in Review series, is my net worth. Like last year, I took stock of my investments and asset allocation. As a reminder to the readers, the idea is not to know how much I am worth, but mainly to understand my asset allocation. Even so, it is fun to check out the net worth, so here it goes.
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Year In Review - 2018 Net Worth
The final chapter in the Year in Review series, is reviewing my net worth. At the end of every year, in addition to reviewing my returns and expenses, I also take stock of my net worth. It is an exercise not to check how much I am worth, but more to get an understanding of my asset allocation, and see if it is converging towards my planned allocation. Lets take a look at the constituents of my net worth first.
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My Asset Allocation
I have discussed the 70:30 asset allocation in my previous 2 posts. However, I did not really follow the rule, not because it did not work for me, but for the simple reason that I wanted to learn market cycles and take risk while doing my investments. I would not suggest anyone play with investments like I did (unless you know what your are doing) and risk losing money. Instead follow the boring simple rule of 70:30 and it works. This is more of a case study of my investing style.
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The 70:30 Asset Allocation
In my previous post, I talked about about allocating 70% to equity and 30% to fixed income and just keep that ratio irrespective of which stage you are in your life. But does it really work? Lets work out some examples to see how it might work under various conditions.
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