A Process to Keep YOU Accountable

An easy but yet often overlook step in building a portfolio is to establish checks and balances. The easiest one to implement is with a sector allocation tracker. By having a sector allocation ratio in place, you can start seeing if you are favouring some investments over others and balance your portfolio between the sectors over time. A balanced portfolio across thought out sectors and ratios can help you weather the market storms that come unannounced. Here are the 3 steps to get setup and all you will have to do is update the total number of shares. The rest is all automated thanks to Google :) STEP 1 Track all the necessary information using Google Spreadsheet by listing all of your stock holdings per account with the following details. Account Stock Ticker Sector (Pick a consistent source for this data) Share Numer Share Price (Use GoogleFinance(Stock Ticker Cell) to get the price) Total Value (= Share Number Cell x Share Price Cell) Use the same source to identify a sector for all your stocks and be careful about using the sector and not the industry. There are a lot of industries compare with sectors. I personally use the TSX as it's regulated information. The account field is there to allow you to have more of the same stock in the list since it’s possible. STEP 2 It’s time to use the power of the spreadsheet to calculate the sector total. List all of the sectors in the sheet and in the column next to it use this to retrieve and add the numbers as a total. You need to use the SUMIF formula. STEP 3 With the total, now we can calculate the ratio and you can compare it to your target. Simply add your portfolio holdings together and divide your total per sector by the overall portfolio value. If you are using the GoogleFinance function, you will have an accurate value at all time based on the actual stock price. Below is what the graphs can look like once you are setup. Overall, it’s pretty easy to setup but if you need a hand, let me know and I will see how I can help you. I truly believe that seeing your portfolio from a sector allocation perspective will be insightful. There are no right or wrong way to set the sector allocations either as long as it matches your goals. If a sector allocation check is a process that you are interested in, I find that comparing stocks within a sector really helps buying the right stock at the right time. To achieve my investing goals, I put together the Dividend Performance List and use it with success. All the best with your investing journey! Eric. Simplify your Dividend Investing Stock Research with the Dividend Performance List. Start your 3-month Trial for $29.

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