Sunday, September 03, 2006

August 2006 Score Card -- Part III: Asset Allocation

Morningstar instant X-ray shows that for our mutual fund portfolio, more than 52% are in US stocks as of August. Another big chunk is foreign stocks, which counts more 38%. The foreign stock part has got a little bigger than what I desire 30%, and the growth mainly came from investments in Dodge & Com International Stock (DODFX), which is the largest holding in the portfolio and has an accumulative gain of 72% since we purchased it three years ago. Some asset allocation suggests 20% in foreign stocks, which is much lower than our current holding. The reason I decide to go with a larger piece of foreign stocks is to catch the repaid growth of developing economies, as well as the steady growth of other meatured markets such as Frence, UK, and Japan.

I sold our only bond mutual fund early this year, but kept the I-Bond and continue to add every month. Now all our bond mutual funds are in tax sheltered accounts.

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