A late notice here, due mostly to the Thanksgiving weekend and my realization that this coming Monday is the start of the new month.
I have two allocation changes available here at the end of the month, and hence can make a slight tweak to the adjustment of the portfolio. Here are the proposed allocations:
| Conservative | ||
| AGG | F-Fund | 7% |
| SPY | C-Fund | 40% |
| EFA | I-Fund | 21% |
| VXF | S-Fund | 32% |
| 100% | ||
| Aggressive | ||
| SPY | C-Fund | 51% |
| EFA | I-Fund | 15% |
| VXF | S-Fund | 34% |
| 100% | ||
Since the last allocation change we've been relatively flat. With the previous allocations, the weighted returns for the Conservative approach have been +0.3% and with the Aggressive approach the weighted returns have been +0.326%. For the aggressive portfolio the weighted C-Fund allocation is up +0.564% and it was hit by a declining S-Fund level of -0.46%.
Note that in a mature market we typically see an underperformance of small cap stocks (S-Fund) and a growth of large cap stocks (C-Fund).
From a long-term perspective, higher allocations in the C-Fund and S-Fund are the better bet. The table above is calculated using the next-day closing prices after I receive the signal to close a position. Note that the table does not include allocations, e.g, it presumes 100% in each fund, which obviously is not accurate. If you were to put 40-30-20-10 in the S-C-I-F funds (respectively) or 34-33-33 in the S-C-I funds (respectively) you would have total returns of 11.0% and 11.2% respectively, over the period September 2008 to present.
Obviously, just guidance, but you get the idea.
Changes made before 12 noon will be effective this month, changes after noon will be effective Monday. If I missed today's change the present allocations (F/C/I/S = 9-36-9-46, Conservative or C/I/S = 40-10-50, Aggressive) are not bad at all and I could probably stay the course with minimal impact on long-term performance.
Happy Thanksgiving to my U,S. readers.
Regards,
pgd
