My retirement portfolio. Please read Disclaimer.
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Saving for retirement
I’m comfortable with 75% Equity and 25% Fixed Income.
- 25% US
- 20% Europe
- 05% Japan
- 10% Asia Pacific Ex Japan (APEJ)
- 10% REIT
- 05% SGX stocks
25% Fixed Income
- 10% Global fixed income
- 05% Asia fixed income
- 10% Singapore fixed income
The above percentage numbers are derived from the ratios I use below. They are rounded to whole numbers.
Equity Asset Allocation Ratio
Core : Supplementary = 80 : 20 = 100%
- Core = US : EU : JP : APEJ = 45 : 30 : 10 : 15 = 100%
- Supplementary = REIT : SGX = 15 : 5 = 20%
Fixed Income Asset Allocation Ratio
Global : Asia : SG = 40 : 20 : 40 = 100%
Using Cash and CPF-SA. Prefer one fund per asset class for simplicity.
US – Vanguard Total Stock Market ETF (VTI)
EU – iShares MSCI Europe ETF (IMEU)
JP – Lyxor Japan (TOPIX) ETF (JPN)
APEJ – Lyxor Asia Pacific Ex Japan ETF (AEJ)
REIT – REIT stocks in SGX
SGX – <Few old holdings from the past. Stop adding currently>
Global fixed income – 50% iShares Citigroup Global Government Bond (IGLO), 50% iShares Global Inflation-Linked Bond (IGIL). Legg Mason Global Bond Trust is the old holding and will not add anymore.
Asia fixed income – ABF Pan Asia Bond Index ETF
SG – SGS Bond Ladder
SG fixed income – CPF-SA money
I use the rebalancing guidelines from the book “The Bogleheads’ Guide to Investing”.
- Use cash in-flows to rebalancing. Avoid rebalancing by selling funds if possible.
- To reduce transaction cost, consider delaying the rebalancing until you have held the asset for more than 12 months.
- The lower and upper limit for both equity and fixed income allocation is minus and plus 5% absolute to the target allocation, respectively. For example, if equity allocation is 70%, then the lower and upper limit is 65% and 75% respectively.
- The lower and upper limit for subclasses allocation within equity or fixed income portfolio is minus and plus 25% relative to the target allocation, respectively. For example, if 50% of equity portfolio is US equities, then the lower and upper limit for US equities is 37.5% (50% X 0.75) and 62.5% (50% X 1.25) respectively.