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#1
09-26-2007, 08:13 AM
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Haven\'t done this in months, hopefully i\'ve learnt something:
I remember back in January or so I was posting how I wanted to have my finances arranged. A number of replies were saying how bad my portfolio was. I'd like to think I've learnt from a mix of views on this forum. Here goes....:
Savings: 58% (highest interest i could find) Investments: 35% (composed of  staking players: 11% - mid variance spreadbetting account (long gold, shorting dollar): 8% - high variance tax free emerging markets fund: 7% - low variance poker bankroll: 6% - low variance sportsbetting tips: 3% - high variance friends who owe me (short term and long term): 7% what would you do to change this? is having almost 60% in savings unwise? i only have 11% in high variance, is this too much or too little (high variance in that losing most of it is possible) i know this is hard given it depends what i want to do long term, but assume i will not want to buy anything big in the next 3 years, however in 3 years time i may want to put a large deposit down on a house. thanks for any thoughts, even if it's just a one liner saying 'pretty dull portfolio, but pretty safe' or 'wtf, put some money into index funds of a mix of domestic and international, low to high cap'. 
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#2
09-26-2007, 11:12 AM
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Re: Haven\'t done this in months, hopefully i\'ve learnt something:
It's just so totally random. I think you would be better off with an overarching investment strategy. Is the 58% long term? Short term? How much of your net worth is designed to be untouched for 30-40 years?
Staking players seems on the surface like such a bad investment simply because a good player should never really need to be staked. I assume you are smart on it though and have calculated ROIs and risk factors. I can't imagine calling emerging markets as low variance. [img]/images/graemlins/smile.gif[/img] And sportsbetting tips? I mean I guess if you know your guy is great but the long term in sportsbetting is VERY long and statistically lots of people have great runs without any real skill. I wouldn't worry about breaking your net worth out like this. Just figure out how much you have for retirement and then work on getting allocations for that piece right. FWIW my net worth breakdown looks like this. Retirement Account entirely in individual stocks - 57% bankroll - 14% House equity - 28% Krishan
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#3
09-26-2007, 11:21 AM
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Re: Haven\'t done this in months, hopefully i\'ve learnt something:
A few points.
1. 58% in savings does seem a little high, but you will know better when thinking of the absolute dollar number that is involved. Having $580 in savings and $1000 overall is not bad allocation, whereas $58,000 in savings while having $100,000 is leaving a lot left on the table that could be earned. 2. While the variance involved with your investments in a factor, another factor is the rate you are earning on those investments. Again, you don't have to divulge this info to us, just something for you to think about. I am guessing you know you want to get the best return possible for with the lowest risk and hopefully that is happening in these investments. That said, just by looking at what is listed and guessing the amount of money involved, you could probably spare to put more of your savings into a couple funds that will earn more than your savings account and not add a lot of risk. If you still want to be extremely safe with all of your savings (and not move any of it to other investments) the banks you are getting the high interest rate most likely has CDs paying even higher. Do a CD ladder at the 6, 9 and 12 month cycles that way you are earning more and if you need the money it will be available to you after 6 months (with more available every 3 months after that). When the 6 month comes due, turn that one into another 9 month and repeat until they are all maturing when you want to do your down payment on the house.
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#4
09-26-2007, 11:25 AM
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Re: Haven\'t done this in months, hopefully i\'ve learnt something:
[ QUOTE ]
i know this is hard given it depends what i want to do long term, but assume i will not want to buy anything big in the next 3 years, however in 3 years time i may want to put a large deposit down on a house. [/ QUOTE ] Man, bad reading comprehension by me. With a 3 year horizon, the savings allocation is good. I think you would be smart to at least allocate some of your net worth to long term retirement. In raw dollar amounts, how much is the max down payment for a house going to be? Can't you more agressively invest everything above that? Krishan
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#5
09-26-2007, 01:44 PM
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Re: Haven\'t done this in months, hopefully i\'ve learnt something:
[ QUOTE ]
Retirement Account entirely in individual stocks - 57% bankroll - 14% House equity - 28% [/ QUOTE ] It's kind of interesting looking at net worth this way. My household is like this: Savings - 7% Retirement - 75% (mutual funds) home equity - 18% poker bankroll - 0.3% <- not very balla yet -Tom
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#6
09-26-2007, 02:45 PM
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Re: Haven\'t done this in months, hopefully i\'ve learnt something:
[ QUOTE ]
[ QUOTE ] Retirement Account entirely in individual stocks - 57% bankroll - 14% House equity - 28% [/ QUOTE ] It's kind of interesting looking at net worth this way. My household is like this: Savings - 7% Retirement - 75% (mutual funds) home equity - 18% poker bankroll - 0.3% <- not very balla yet -Tom [/ QUOTE ] Net worth Housing: 88% Retirement: 7% Savings: 5% I'm obvs way high on the housing, but not willing to change that situation and not house poor so it's all good.
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#7
09-26-2007, 05:37 PM
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Re: Haven\'t done this in months, hopefully i\'ve learnt something:
[ QUOTE ]
[ QUOTE ] [ QUOTE ] Retirement Account entirely in individual stocks - 57% bankroll - 14% House equity - 28% [/ QUOTE ] It's kind of interesting looking at net worth this way. My household is like this: Savings - 7% Retirement - 75% (mutual funds) home equity - 18% poker bankroll - 0.3% <- not very balla yet -Tom [/ QUOTE ] Net worth Housing: 88% Retirement: 7% Savings: 5% I'm obvs way high on the housing, but not willing to change that situation and not house poor so it's all good. [/ QUOTE ] This looks kind of fun. Net worth Savings - 2% Market(index funds) - 60% (mutual funds) home equity - 38%
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#9
09-26-2007, 11:38 PM
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Re: Haven\'t done this in months, hopefully i\'ve learnt something:
[ QUOTE ]
Savings: 58% (highest interest i could find) [/ QUOTE ] You're young and obviously understand variance, so it seems to me like you would be better off moving at least some of this to index funds. Personally as a pro gambler I can't stand taking lower EV bets, which is essentially what your savings account is. You can stand to take some fluctuations, and over the next 3 years index funds are a favorite to have higher returns than a savings account, and over 10-15 years its a huge favorite.
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#10
09-27-2007, 12:57 PM
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Re: Haven\'t done this in months, hopefully i\'ve learnt something:
My gf and I are 28 and here is our allocation:
Retirement (401k, IRA, RothIRA1, RothIRA2) 40% Short-term savings (5% e-savings) 43% (This is for a home purchase in 2-3 years). Mutual funds (may or may not be used for home): 6% Bank account: 4% (usually lower, like 2%) Cars (two old cars): 6%? Might be lower. Debts: 2% car debt that will be gone by payday Monday. [img]/images/graemlins/cool.gif[/img] Also Student Loan debt equal to about 12% of my net worth. I could obv. pay it off tomorrow, but the rate is low and they're easy to work with so I'm not in a huge rush. I think I'd rather have more capital for a house downpayment in a couple years, then finish off the student loan.
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