The Sleepy Mini Portfolio gained another 5.1 percent since my previous update approximately one quarter back. The portfolio was started with an initial investment of $1,000 in August 2007 and it is assumed that periodic savings of $1,000 is added to portfolio every quarter. Here’s how the portfolio components were valued as of February 28, 2011:

TDB909 – Canadian Bonds – $2,964 (19.0%)
TDB900 – Canadian Equities – $3278 (20.8%)
TDB902 – US Equities – $4,673 (30.7%)
TDB911 – International Equities – $4,822 (29.5%)
Total – $15,737
Total Invested – $14,000

We’ll now add another $1,000 to the portfolio and rebalance it to the original asset allocation — 20% bonds, 20% Canadian stocks, 30% US stocks and 30% international stocks — using this rebalancing spreadsheet. As an aside, if you are using TD e-Series funds, you can invest a smaller sum of money than $1,000. If you sign up for a Pre-Authorized Purchase Plan, the minimum required per fund is only $25. That means, you need just $125 to start a Sleepy Mini Portfolio such as this one (you would, of course, rebalance, say, once every year).

Transactions

TDB909 – TD Canadian Bond Index (e-Series) – Buy units for $352.89.
TDB900 – TD Canadian Index (e-Series) – Buy units for $100.00.
TDB902 – TD US Index (e-Series) – Buy units for $347.66.
TDB911 – TD International Index (e-Series) – Buy units for $199.45.

Once again, the Sleepy Mini Portfolio does not end up with a precise 20-20-30-30 asset allocation because the TDB900 requires a minimum investment of $100 but the amount to buy came out to $69.34. Therefore, I bumped up the Canadian stock allocation slightly at the expense of Canadian bonds.

[Sleepy Mini Portfolio as of Feb. 28, 2011]

This article has 6 comments

  1. Pingback: Sleepy Mini Portfolio Q1-2011 Update | MoneySense

  2. I like the idea of the sleepy mini portfolio…but from your graph it doesn’t look like the returns are all that good. Have you compared with what returns you would have gotten by simply buying GICs at $1000 per quarter since Sep 07?

  3. That’s just starting date bias and a short history (not even 5 years). Had he started in Jan/Feb 2009 rather than Sept 2007, the return would be much, much better.

    This is why short term investments (< 5 – 10 years) should be in very safe investments like bonds/GICs, potentially lower returns (depending on market conditions), but much much safer than stocks.

  4. @Moira: When it comes to stocks, investors have to be patient. Stocks are likely (but not guaranteed) to beat bonds over the long term. Long-term means at least 10 years and ideally much longer — 20 years or more.

    Also, you need time for compounding to work its magic and convert that 2 to 3 per cent better returns than bonds into a big chunk of cash. In that light, this portfolio is like a baby. It’s just starting out and needs time to realize its potential.

  5. Wow, that’s actually really good. The stability is reassuring.

    Remember folks, it’s not just about returns. Keeping losses to a minimum is extremely important.

  6. Pingback: Sleepy Mini Portfolio Q2-2011 Update | Canadian Capitalist