Date: Sat, 7 Jul 2007 14:27:40 -0500
From: pmb@his.com (Paul Michael Brown)
Subject: Re: need portfolio advice
Newsgroups: misc.invest.financial-plan
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BreadWithSpam@fractious.net, pithy and didactic as usual, opined thusly:

> With a 34 year time horizon, for this particular 
> batch of money, you may not need *any* bonds.

I respectfully differ. A 85/15 mix for a 31 year old investor will reduce
volatility and make it easier to him to invest over the long haul without
panicking if equities hit a rough stretch. As they say on the Street, you
make money in stocks, but you keep it in bonds. Sure, the long term return
on an 85/15 portfolio will be a little less than going 100 percent
equities. But the reduction in volatility is worth it in my view.

> Vanguard's 2040 retirement plan has only 10% in bonds.

> T. Rowe's 2040 fund has 7.23% in bonds, 4.25% in cash.
 
> Fido's 2040 has 11.8% in bonds, 3.5% in cash.

So the original poster's 85/15 allocation is reasonably close to what the
pros are doing. That should reassure him.

The original poster also asked if having 23 percent of his equity money
invested in international stocks was overly aggressive. I don't think so.
Most of the model asset allocations out there suggest having 20-30 percent
of your equity money invested in international names. As for targeting
Canada specifically, I don't think that's necessary. Canadian equities are
probably well correlated to U.S. issues, so you add complexity without
getting diversification.

All in all, the original poster is doing just fine. Just remember to save
as much as possible.