My asset allocation
Posted by texasmoose on May 12, 2007
So, after thinking about all the stuff I wrote on asset allocation, I plugged my numbers into the X-ray overview at Morningstar to get an idea of my asset allocation. Here’s what I got… I have three retirement accounts that I included. The first is my 401(k), where I am limited in the selection of funds that I can buy. However, because I have 30+ years until retirement, I am heavily weighted in small cap and international funds which are doing pretty well, and am returning a comfortable 9% ytd.
My other two accounts, the IRA and Roth, are at Fidelity, where I transferred them earlier in the year. In the IRA, I own the Spartan US Equity Index Fund (FUSEX). The description of the fund states that it “seeks to provide investment results that correspond to the total return (i.e., the combination of capital changes and income) performance of common stocks publicly traded in the United States.” I’m not exactly sure if this means the S&P 500, Russel 3000, or Wilshire 5000, although the description also states that 80% of the fund is invested in common stock of the S&P 500 and it compares itself to the S&P 500, so I’ll go with that. Regardless, with an expense ratio of 0.09%, this is half the expense ratio of Vanguard’s S&P 500 Index. In the Roth I own Fidelity Asset Manager 85% (FAMRX), which is a large blend fund with some bonds thrown in to reduce risk, and the Fidelity International Discovery (FIGRX), as I wanted some international exposure.
So, plugging everything in, I’m 58% US stocks, 32% international stocks, 4% cash, and a few percent “other”. Of the stocks, I have about 60% large-cap, 20% mid-cap, and 20% small-cap, evenly spread across value, growth and core. Of the international stocks, most are European, with lesser amounts of Canadian, Japanese, and other Asian stocks.
So, what does this mean? With the extended time frame for these investments, maybe I can push a little harder (read: riskier). I can go into more mid- and small-cap, maybe a sector specific fund, such as commodities or REITs (although these have had a good run, I don;t want to buy at the top), or maybe an emerging market or international small-cap fund. I’ll need to do a little research to see where I should go…
