Author Topic: Portfolio Re-balance (Canada)  (Read 1809 times)

civicHB

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Portfolio Re-balance (Canada)
« on: January 25, 2018, 09:44:07 PM »
Hello Mustachians! Looking for some advise on how to re-balance my portfolio. I have some cash to invest 10-20% and also would consider moving out of some of my current stocks into others.
I'm a fan of index funds, but also like holding few individual stocks.
The current market is at all time high's and preferably I don't like purchasing at highs. Some stocks(funds) i'm considering are AAPL, AMZN, VTE, VEE.

Currently Mid 30's age

Canada Exposure - 44%
Baytex   2%
Manulife   5%
CNR           10%
CDN Index   22%

US Exposure 37%
GE           2%
Clorox   7%
Bank of America   5%
Us Index    19%

Int'l Index   17%

Cash   10%-20%

appreciate any help
« Last Edit: January 26, 2018, 08:41:25 AM by civicHB »

joonifloofeefloo

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Re: Portfolio Re-balance (Canada)
« Reply #1 on: January 25, 2018, 10:26:31 PM »
I'm a fan of index funds, but also like holding few

Welcome, civicHB!

I wasn't sure what your line above meant.

Are you familiar with Canadian Couch Potato Model Portfolios? Many of us simply implement one of those. If you're keen to pick a few stocks as well, you could do a CCP Model Portfolio as a base, then put a (very small) portion into picks.

http://canadiancouchpotato.com/model-portfolios-2/

A lot of us do the ETFs through whichever our preferred brokerage is. Some here buy them through Questrade, some buy them through TD Direct Investing, some through RBC Direct Investing, etc.

civicHB

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Re: Portfolio Re-balance (Canada)
« Reply #2 on: January 26, 2018, 08:45:24 AM »
I'm a fan of index funds, but also like holding few

Welcome, civicHB!

I wasn't sure what your line above meant.

Are you familiar with Canadian Couch Potato Model Portfolios? Many of us simply implement one of those. If you're keen to pick a few stocks as well, you could do a CCP Model Portfolio as a base, then put a (very small) portion into picks.

http://canadiancouchpotato.com/model-portfolios-2/

A lot of us do the ETFs through whichever our preferred brokerage is. Some here buy them through Questrade, some buy them through TD Direct Investing, some through RBC Direct Investing, etc.

I follow the CCP for the most part, been adding stocks lately as market is at all time highs. I know i shouldn't time, but i've got some windfalls and the idea of buying index funds that are at multi-year highs just doesn't sit well. Maybe i'm wrong on this.

joonifloofeefloo

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Re: Portfolio Re-balance (Canada)
« Reply #3 on: January 26, 2018, 10:30:44 AM »
I follow the CCP for the most part, been adding stocks lately as market is at all time highs. I know i shouldn't time, but i've got some windfalls and the idea of buying index funds that are at multi-year highs just doesn't sit well. Maybe i'm wrong on this.

A few thoughts here...  I think you know most or all of this, but something's not clear yet, so I'll type to try to clarify.

Prepackaged stocks (a fund) or individual picks are all stocks. By buying individual stocks or different funds, you're still buying stocks at a high-to-date.

With stocks at a high-to-date, your rebalance will likely involve increasing the percentage of bonds -not picking individual stocks and additional funds.

Via CCP model, you've already invested in thousands of stocks. So you're looking now at picking individual stocks over and above those. Some on the forum do that. However, unless "x% in individual, hand-picked stocks and funds" is in your Investment Policy Statement, this wouldn't be considered a portfolio rebalance. Rebalancing is adjusting your allocations to match the model you are using (CCP) or wrote out for yourself (Investment Policy Statement).

Does your Canadian index fund not already include Manulife, for example? If so, what prompts you to want to put even more in that?

Some of the items your considering are also funds (groups of stocks). What's prompting you to select another fund on top of the ones recommended by CCP?

If you are committed to picking individual stocks over and above the thousands of individual stocks you already own via your index funds...
Have you written your Investment Policy Statement?
If so, what does it set out in terms of:
*what percentage of your overall portfolio you will allocate to individual stocks?
*the information per individual stock you will need in order to select one?

A very well-researched pick may make sense.
An individual stock picked by emotion, or a stock being at an all time high, is profoundly discouraged.

In this thread, it sounds like you're not looking at rebalancing a portfolio, but rather selecting individual stocks and additional funds (vs increasing your investment in the funds you already have, representing thousands of stocks). If so, I recommend changing the thread's title to say "help picking stocks". Then you might get feedback on that.

civicHB

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Re: Portfolio Re-balance (Canada)
« Reply #4 on: January 29, 2018, 10:27:45 AM »
jooniFLORisploo Appreciate the very detailed response . I think you have totally nailed that I mis-titled my topic and should have instead asked for help picking stocks. After I read your suggestions I realized that I don't even have an Investment Policy Statement and maybe I should work on that to determine how to allocate my funds.

Thanks again and look forward to my new thread once I sort out my investment policy statement.

I follow the CCP for the most part, been adding stocks lately as market is at all time highs. I know i shouldn't time, but i've got some windfalls and the idea of buying index funds that are at multi-year highs just doesn't sit well. Maybe i'm wrong on this.

A few thoughts here...  I think you know most or all of this, but something's not clear yet, so I'll type to try to clarify.

Prepackaged stocks (a fund) or individual picks are all stocks. By buying individual stocks or different funds, you're still buying stocks at a high-to-date.

With stocks at a high-to-date, your rebalance will likely involve increasing the percentage of bonds -not picking individual stocks and additional funds.

Via CCP model, you've already invested in thousands of stocks. So you're looking now at picking individual stocks over and above those. Some on the forum do that. However, unless "x% in individual, hand-picked stocks and funds" is in your Investment Policy Statement, this wouldn't be considered a portfolio rebalance. Rebalancing is adjusting your allocations to match the model you are using (CCP) or wrote out for yourself (Investment Policy Statement).

Does your Canadian index fund not already include Manulife, for example? If so, what prompts you to want to put even more in that?

Some of the items your considering are also funds (groups of stocks). What's prompting you to select another fund on top of the ones recommended by CCP?

If you are committed to picking individual stocks over and above the thousands of individual stocks you already own via your index funds...
Have you written your Investment Policy Statement?
If so, what does it set out in terms of:
*what percentage of your overall portfolio you will allocate to individual stocks?
*the information per individual stock you will need in order to select one?

A very well-researched pick may make sense.
An individual stock picked by emotion, or a stock being at an all time high, is profoundly discouraged.

In this thread, it sounds like you're not looking at rebalancing a portfolio, but rather selecting individual stocks and additional funds (vs increasing your investment in the funds you already have, representing thousands of stocks). If so, I recommend changing the thread's title to say "help picking stocks". Then you might get feedback on that.

joonifloofeefloo

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Re: Portfolio Re-balance (Canada)
« Reply #5 on: January 29, 2018, 11:16:37 AM »
Awesome, civicHB :)