|Stock||JNJ||Johnson & Johnson|
|Equity ETF||VYM||Vanguard High Dividend Yield ETF|
|Equity Mutual Fund||DODFX||Dodge & Cox International Stock Fund|
|Equity Mutual Fund||PRIDX||T. Rowe Price International Discovery Fund|
|Bond ETF||VCIT||Vanguard Intermediate Term Corp Bond ETF|
|Bond Mutual Fund||VWITX||Vanguard Intermediate Term Tax-Exempt Bond Fund|
|Bond Mutual Fund||VWEHX||Vanguard High Yield Corporate Bond Fund|
- Current Income
- Income Growth
- Capital Appreciation
- Diversification among securities and asset classes
PORTFOLIO ASSET ALLOCATION
- 45% Bonds
- 35% US Equities
- 10% International Equities
- 10% Cash Reserves
This is a fairly conservative asset allocation. However, I believe it works well for my purposes. Above all, each individual investor’s asset allocation will be different. As a result, asset allocation should be based on each individual’s personal situation and risk tolerance. Even more, research shows that asset allocation is one of the greatest factors influencing a portfolios return. Hence, asset allocation decisions are very important.
For US equities, I prefer individual dividend paying stocks. There are many advantages to building your own high quality individual stock portfolio. Therefore, I plan on adding to the individual stocks in this portfolio as time progresses. And as a result, I will reduce reliance on the Vanguard High Dividend Yield ETF (VYM). VYM is representative of the dividend paying US equity market. Consequently, I use VYM for diversification purposes.
International Equities and Bonds
For the international equity and bond portion of my portfolio, I prefer mutual funds and exchange traded funds. Because I do not feel I have the expertise to choose individual securities in these areas. I track the market through an ETF or let a professional manager do the work for me. Investments costs always concern me when investing in actively managed funds.
You can check out my individual stock selection criteria here: Stock Selection Criteria
Additionally, I will explore portfolio structure, costs, asset allocation, stock analysis and fund reviews through my weekly posts. To wrap up, how do you structure your portfolio?
Disclosure and disclaimer