My Asset Allocation Update

I write a lot about my asset allocation on this blog. That is simply because it is the most important component of portfolio performance that an investor can work with. I keep very close track of my asset allocation in an Excel spreadsheet. If you have been reading the blog for a while, then you know that I have been slowing working on bringing my asset allocation more inline with my target allocation (here, here, and here).

It has been slow progress, but I am happy to announce that I have been able to bring the fixed income up slightly to 13.5%. Given that my target is 36%, I have a lot of work to do but at least it is going in the right direction. I also have done very well with Royal Bank of Canada over the number of years I have owned it, and even with cutting back on some of my holdings in this stock, it has put my Canadian allocation in a position of being too high. This is something I am going to fix by adding to other allocations (i.e. fixed income) rather than selling anything else. I only like to sell on dividend cuts and since I add money regularly to my portfolio I feel that I can reduce this exposure over time.

For those of you who are visually inclined, here is a chart depicting my current asset allocation. Believe it or not, this is better than it was a few months ago so I am happy about that. That being said, my portfolio performance has been good and I am beating the market so it seems to be working out nicely. I still want to ensure I am protected on the downside so I am focused on brining it in line regardless of the good performance. Next time I report on my allocation I hope to show some further progress.

Click to Enlarge