Portfolio Update December 2022

The financial market finishing strong in the final months of 2022 after a terrible 6 months. Financially, 2022 was not a great year with inflation raging around the world and crypto fraud companies finally got binned into a long crypto winter. It seems that recession is coming in the first half of 2023.

The portfolio did very well nonetheless. It was a flat year overall with close to 0% loss. However, the target allocation had changed quite a lot due to higher allocation in cash (interest rate bites) and bonds after a round of home loan refinancing.

I managed to increase the US equities thanks to recalculation of the US portion in the indexed funds, and buying some more indexed funds.

Crypto world is in a deep mess. They are currently in junk territory with a lot of fraudsters and tech bros running the largest exchanges. It might take a while and some additional regulations before the confidence returns. I only have Polkadot and Bitcoin in a cold wallet with a 80% paper loss vs purchase prize โ€“ ugh. The current allocation is now the following:

PercentageTarget
Australia26.08%26.00%
Emerging7.25% 8.00%
US25.74%28.00%
International (non-US)13.07%14.00%
REIT1.91%2.00%
Bonds5.88%9.00%
Gold6.63%6.50%
Cryptocurrencies0.25%0.50%
Cash13.44%6.00%
Portfolio allocation 2022.

Overall, the allocation is 70% equities and 30% fixed income + cash, or 83% equities and 17% fixed income if cash is excluded. Next year the goal is to add more to fixed income allocation while trying to keep cash holding to a minimum level. It’s not so easy with recession looming. See you in the new year!

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