Since my previous update, the Sleepy Mini Portfolio has gained 4.95 percent due to a rally in the stock markets over the summer. It is now exactly five years since the Sleepy Mini Portfolio was launched in August 2007 with an initial investment of $1,000 with a target allocation of 20% bonds, 20% Canadian stocks, 30% US stocks and 30% International stocks. Another $1,000 was added to the portfolio every quarter since then for a total investment of $20,000. Here’s how the portfolio looks as of September 5, 2012:
TDB909 – Canadian Bonds – $4,198 (19.1%)
TDB900 – Canadian Equities – $4,461 (20.3%)
TDB902 – US Equities – $6,596 (30.0%)
TDB911 – International Equities – $6,716 (30.6%)
Total – $21,972
Total Invested – $20,000
The idea behind the Sleepy Mini Portfolio is to follow a mechanical investment strategy of committing savings to the portfolio on a regular basis. Therefore, we will add another $1,000 to the portfolio and rebalance it to the original target allocation using this rebalancing spreadsheet. Here are the results:
Transactions
TDB909 – TD Canadian Bond Index (e-Series) – Buy units for $396.01.
TDB900 – TD Canadian Index (e-Series) – Buy units for $133.46.
TDB902 – TD US Index (e-Series) – Buy units for $295.20.
TDB911 – TD International Index (e-Series) – Buy units for $175.34.
Unlike the last series of transactions, a larger portion of the current addition to the portfolio is going into bonds. That’s just because the rally in the stock markets has left the bond portion of the portfolio slightly below target.
Readers are often curious about the annualized returns of the Sleepy Mini Portfolio. It is easy to calculate using the XIRR function in Microsoft Excel. Plugging in the dates, contributions and the current portfolio value tells us that the Sleepy Mini Portfolio returned an annualized 3.6 percent over the past five years.
