Thursday, January 12, 2006

Initial portfolio

Initial portfolio on January 11, 2006

This is our current portfolio and will serve as the starting point for performance tracking for this blog. My wife and I accumulated most of these positions over the past 5 years. My wife trusted me to make most of the financial decisions so I’ll be using the singular pronoun even though in many instances it should be plural.

As can be seen, the portfolio is divided into two portions: an actively managed (AM) portion and an asset allocation (AA) portion at a 55:45 split. I generally aim for an even split. The AA portion gives me the peace of mind while the AM portion allows me to excise some fancy of untold riches at the same time. I suspect this is what most people do subconsciously anyway, albeit in a less structured way.

The actively managed accounts are all at brokerages or mutual fund companies. Most are taxable accounts, with approximately 10% in tax deferred or Roth IRA accounts. I’m not a day-trader; the holding periods generally range from months to years. I’m not a buy-and-holder either, selling based on stop-loss or technical signals occur often. I'll discuss my thinking behind each buy/sell decision as they occur.

The asset allocated portion consists of: mine and my wife’s 401k, an ETF based sub-portfolio that was first established on 9/8/2005 for $30k, and another sub-portfolio based on ETFs and mutual funds that I used to plug the holes in the asset allocation plan left by the other three. The first three accounts were designed as stand alone asset allocation plans.

I’ll take this as the position at the beginning of 2006 although I’m already shortchanging myself by 3-4 percentage points due to the recent rally. More detailed portfolio analysis will follow. Portfolio performance will be tracked monthly.