05-12-2014, 08:27 PM
When I get a lot closer to retirement, I imagine I will think a lot more about specific allocations and rebalancing. For the time being, I don't give it a ton of attention. My three biggest holdings make up almost 30 percent of my dividend growth portfolio, and almost 20 percent of the total is in tobacco.
I hope that by the time I'm done building it, my portfolio will be three or four times its current size. While having, say, $25,000 in a single stock right now is a large position, percentage-wise, one day it will not be. So if I spend a lot of time and energy rebalancing now, all I'll really do is slow down my performance. As it is, I have the flexibility to go heavily into the best opportunities. In ten or 15 years, I'll try to smooth it out with how I allocate new money. And some time after that, perhaps I'll consider true rebalancing.
I hope that by the time I'm done building it, my portfolio will be three or four times its current size. While having, say, $25,000 in a single stock right now is a large position, percentage-wise, one day it will not be. So if I spend a lot of time and energy rebalancing now, all I'll really do is slow down my performance. As it is, I have the flexibility to go heavily into the best opportunities. In ten or 15 years, I'll try to smooth it out with how I allocate new money. And some time after that, perhaps I'll consider true rebalancing.