Monday, 18 January 2010

My Current Low Charge Portfolio – January 2010

Another month passes.

Buying: As always I contributed about 60% of my gross salary towards my retirement investing strategy. Of this 60% the allocations I made are 64.7% Cash, 5.3% UK Equities, 7.4% International Equities, 1.4% Index Linked Gilts and 21.2% Property.

Selling: Nothing this month.

Dividends: My Australian Equities paid dividends of about 1.5% of the total value of the Australian Equities. I have taken these dividends off the table and put them to Cash as I was overweight Australian Equities.

Current UK Retail Prices Index: 0.28%

Current Annual Charges: 0.60%

Current Expected Annual Return after Inflation: 4.2%

Current Return Year To Date (from 01 January 2010): 0.1%

How close am I to retirement: 41.3%

The following are the highlights for the month:

- Desired Cash portion moves from 11.6% to 12.4%. This month I have moved further from the desired by going from 12.7% to 13.5%.

- Desired Bonds portion moves from 17.2% to 17.4%. This month I have moved closer to the desired by going from 20.7% to 20.1%.

- Desired Property stays constant at 10.0%. This month I have moved closer to the desired by going from 7.7% to 7.9%. With the poor exchange rates to the GBP I have been reluctant to buy outside the UK and so these purchases have been all UK Commercial Property.

- Desired Commodities stays constant at 5.0%. This month I have moved further from the desired by going from 2.8% to 2.6%. With the poor exchange rates to the GBP I have been reluctant to buy gold. However this asset class is now the furthest from the desired percentage of any asset class. I may buy here soon.

- Desired International Equity portion moves from 13.3% to 12.9%. This month I have moved further from the desired by going from 13.1% to 13.3%.

- Desired Emerging Market Equities stays constant at 5.0%. This month I have stayed constant at 2.9%. In GBP terms Emerging Market Equities are at a near high since May ’08. I have tried to compensate by holding extra UK Equities which earn a reasonable portion of their revenues in International and Emerging Markets.

- Desired Australian Equity portion stays constant at 19.3%. This is because the Reserve Bank of Australia is yet to publish its data yet meaning I am unable to calculate the ASX 200 PE10. This month I have moved closer to the desired by going from 20.9% to 20.5%. It is almost impossible for me to get out of this class tax effectively other than by dividends and by eroding the percentage by not investing in the asset class. Not an ideal situation to be in.

- Desired UK Equity portion moves from 18.6% to 18.0%. This month I have moved further from the desired (partially to compensate for Emerging Markets) by going from 19.2% to 19.3%.

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