Author Topic: new to asset allocation - how to do contributions  (Read 539 times)

aGracefulStomp

  • 5 O'Clock Shadow
  • *
  • Posts: 92
  • Location: Australia
new to asset allocation - how to do contributions
« on: July 29, 2017, 05:30:56 AM »
New to the asset allocation approach. Happy with my asset allocation and not looking for advice on that aspect :)

My asset allocation is cash : stocks = 30 : 70.

Let's say every month I have $1,000 to contribute. Should I contribute according to my asset allocation goal ie $300 cash : $700 stocks, or should I contribute according to my actual asset allocation (ie review my portfolio and contribute in a way that maintains the 30:70 allocation)?

Villanelle

  • Magnum Stache
  • ******
  • Posts: 2529
Re: new to asset allocation - how to do contributions
« Reply #1 on: July 29, 2017, 05:46:45 AM »
I would probably just do 30/70 each month, and then rebalance (buy or sell stocks as needed) quarterly.  If really depends on just how exact you want to be.  If it important to stay much closer to those numbers, you could check every other month and rebalance.  The more often you do it, the more work but the closer you'll stick to your 30/70 split.