Friday, January 11, 2008

My 401k Asset Allocation for 2008


As you can see, I am keeping it simple. I have rebalanced my portfolio and picked 4 new funds in the new platform that have performed well in the past 10 years (or since inception).

This asset allocation is 25% international, 25% large cap, 25% mid cap and 25% small cap.

This is a highly aggressive portfolio which will suffer significant drawdowns in a market downtrend, but also should easily outperform the S&P500 in a market uptrend. Since I am dollar-cost averaging into these funds and do not plan on touching any of this money for at least 20 years, a market downtrend only means I am buying more shares for the same amount of money. What matters is that 20 years from now, the market is higher than where it is now.

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