Chapters
Chapters
Chapter 10
Maintaining your portfolio
What needs attention in a working portfolio? Measure the mix and money flows, explain the result, then apply a given maintenance policy and record the reason for the review outcome.
Next lessonHow your portfolio drifts from its plan
—All materials read
- How your portfolio drifts from its planFind today’s denominator, then see why two rules described as “five percent” accept different weights.Read
Once the deviation is measured, compare ways to change it and what each would cost.
- When and how to rebalanceFollow three routes from the same portfolio: move existing money, add enough to reset, or accept a partial adjustment.Read
Money entering the portfolio also changes its reported balance. Separate that flow from the investment result.
- How to judge your investment resultsReconcile a larger balance with a losing year, then separate investment performance from the money still needed for a goal.Read
Bring implementation and funding findings separately to a recorded review; apply the maintenance policy before considering a strategy change.
- What to review and when to change the planApply a given maintenance policy to new money and drift, compare a full reset, and record the reason and next check.Read
When the goal or your circumstances change, maintenance may no longer be enough. Next, examine how new obligations and spending alter the plan.
Next chapter: When life and goals change