Evaluating My Asset Allocation: June 2019
Understanding asset allocation on a portfolio is one of the most important steps in the investing journey.
Diversifying our investments into different assets classes allows investors to get exposure to different levels of risk and different risk factors. No matter how small or large our portfolio is, spreading money over different baskets helps all types of investors against the rotten apples.
When calculating my net worth, I have mapped all my assets and ended up noticing the assets classes I am actually invested on.
The Breakdown
Since I have several savings and investment accounts, I am summarizing my assets into 5 main categories:
- Cash
- Savings
- Stock Market
- P2P Investing
- Private Equity
Cash is money on current accounts or savings accounts that I can easily move money from without penalties or having to wait several days to have it available. This also includes a 6-month emergency fund just in case of unexpected expenses or a job loss. Bonds and money market funds are also included here.
Savings is the money I put into special savings accounts such as housing savings accounts and retirement/pension plans. This…
