Software to Automate Portfolio Rebalancing?

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NateW
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Software to Automate Portfolio Rebalancing?

Post by NateW » Wed Nov 21, 2012 7:47 am

Do any of you automate your portfolio rebalancing to get in line with your desired asset allocation? If so, what do you use? Ideally I am looking for a system where I download the data from each mutual fund account and I then get the allocation percentages and dollar amount by the fund categories of bonds, US, European, Pacific, emerging markets stocks, REIT, etc.

Presently, I manually key the data into a Excel spreadsheet into each fund category and it is extremely cumbersome since me and my wife have several different Vanguard target date funds in different accounts. Before the data is keyed in, the target date fund balances are manually calculated into the eight or so different fund types in each account and then added to like types. We also have many other funds, some of which have more than one category of stocks, i.e. VG Total International Stock Market and various American Funds mutual funds. I spend about six hours on the calculation every time I rebalance. There has to be an easier way. I figured many of you would know what the easy, simply, painless way to rebalance is. Thanks.

--Nate

livesoft
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Re: Software to Automate Portfolio Rebalancing?

Post by livesoft » Wed Nov 21, 2012 7:57 am

First, I don't worry too much about rebalancing though I do rebalance every once in a while. If I want 30% US stocks, that really means I want 27% to 33% US stocks and not 30.00000% US stocks.

Second, I don't use a spreadsheet because if I only need to be in the ballpark, what's the point?

Third, I do use "software" in that I have my portfolio entered in the Morningstar Portfolio Manager, the Vanguard web site, and the Fidelity web site. With a web browser, I can see the big picture relatively instantly and it changes very slowly.

Fourth, I do have an accurate view of my portfolio by using MS Money, but it does not help with rebalancing. I think we have about 30+ different investments spread over 18 different accounts, but only a few of these have any transactions in them, so data entry is a few bond fund dividends a month.

I suspect that spreadsheet of yours is getting in the way and I would lose it.
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investor1
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Re: Software to Automate Portfolio Rebalancing?

Post by investor1 » Wed Nov 21, 2012 10:06 am

Why are you using target date funds if you handle rebalancing yourself? Why not just setup a three fund portfolio across all of your accounts? You could probably lower your expenses by doing this and simplify the rebalancing process (assuming you want to keep doing it).

Frank Rizzo
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Re: Software to Automate Portfolio Rebalancing?

Post by Frank Rizzo » Wed Nov 21, 2012 10:12 am

investor1 wrote:Why are you using target date funds if you handle rebalancing yourself? Why not just setup a three fund portfolio across all of your accounts? You could probably lower your expenses by doing this and simplify the rebalancing process (assuming you want to keep doing it).
Yep - I bet your spreadsheet is unnecessarily complex due to the multiple target date funds. Surely you could just invest in the actual index funds directly and manage it yourself.

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rustymutt
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Re: Software to Automate Portfolio Rebalancing?

Post by rustymutt » Wed Nov 21, 2012 10:26 am

I use a spreadsheet with formulas I've created to tell me the number of shares to get to the required % of any index. These %s can be easily changed as needed. I get the number of shares, and the dollar amount color coded to sell, or buy. As to automate the time of any re-balancing, I just wait til it's out of whack by 5%.
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z0r
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Re: Software to Automate Portfolio Rebalancing?

Post by z0r » Wed Nov 21, 2012 11:20 am

This doesn't answer your main question (how to pull an allocation for a target date or balanced fund) but it could save some time anyway:

putting your spreadsheet on google drive (google docs) will let you automatically pull prices. see this page:

http://support.google.com/drive/bin/ans ... wer=155178

for example, this in a cell will pull VISVX's latest share price (from the last market close, which seems to update at about 6 PST)

=GoogleFinance("VISVX"; "price")

To pull your allocations for each fund, the best I can offer is to make a new sheet that you fill in manually across all of the slices you want to track, for each fund. You'll end up with a matrix of slices and funds. Set the spreadsheet up to calculate slices automatically using this new table. Then just check to see if a fund has changed its slices significantly each time you rebalance- often each fund will be more or less the same and won't require any update.

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BigFoot48
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Re: Software to Automate Portfolio Rebalancing?

Post by BigFoot48 » Wed Nov 21, 2012 11:58 am

Frank Rizzo wrote:Yep - I bet your spreadsheet is unnecessarily complex due to the multiple target date funds. Surely you could just invest in the actual index funds directly and manage it yourself.
I was so happy when I saw the light a few years ago and got rid of my balanced funds and simplified things down to a few index funds. My spreadsheet handles telling me the allocation each month but I rarely (> 12 months) have to rebalance using the 5%/25% tracking method.

However I think some people would benefit by having just one balanced fund, like Wellesley, Wellington or a Target fund, if they don't want to do all that re-balancing stuff themselves.
Retired | Two-time in top-10 in Bogleheads S&P500 contest; 12-time loser

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leonidas
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Re: Software to Automate Portfolio Rebalancing?

Post by leonidas » Wed Nov 21, 2012 12:04 pm

I used to use quicken and that had a rebalancing tool built into its investment section.
Also, I used fundmanager software during a trial and it did rebalancing too.

Default User BR
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Re: Software to Automate Portfolio Rebalancing?

Post by Default User BR » Wed Nov 21, 2012 1:16 pm

NateW wrote:Do any of you automate your portfolio rebalancing to get in line with your desired asset allocation?
I use a custom Excel spreadsheet that aggregates the account information from downloaded or update sheets, preforms a 5/25 analysis, and signals any rebalancing needs.


Brian

Drew31
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Re: Software to Automate Portfolio Rebalancing?

Post by Drew31 » Wed Nov 21, 2012 1:39 pm

livesoft wrote:First, I don't worry too much about rebalancing though I do rebalance every once in a while. If I want 30% US stocks, that really means I want 27% to 33% US stocks and not 30.00000% it.
Curious... When you do rebalance, do you just rebalance to the middle of your range?

Drew31
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Re: Software to Automate Portfolio Rebalancing?

Post by Drew31 » Wed Nov 21, 2012 1:40 pm

leonidas wrote:I used to use quicken and that had a rebalancing tool built into its investment section.
Also, I used fundmanager software during a trial and it did rebalancing too.
Was this quicken deluxe or premier?

NateW
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Re: Software to Automate Portfolio Rebalancing?

Post by NateW » Wed Nov 21, 2012 1:57 pm

Thank you for your replies. I've been trying to simplyfy my portfolio. Recently I exchanged Vanguard's European, Pacific, and Emerging Market stock funds for their Total International Stock Market for a nice tax loss harvest in my taxable account:happy. The reason for the VG target date funds is my 401k (through private branding by Transamerica Insurance Co.) offers them, after tacking on a 1.5% ER. These are the least costly funds in crappy 401k and since we have my wife's rollover IRA and our Roth IRAs at Vanguard, we at least have one fund brand.

Twice a year I like calculating the exact percentages of VG Total Stock Mkt., VG Small Cap Index, VG European Stock Index, VG Pacific Stock Index, VG Emerging Markets Index, Foreign small cap, and VG Total Bond Market and then rebalancing if off by more than a couple of percent.

--Nate

livesoft
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Re: Software to Automate Portfolio Rebalancing?

Post by livesoft » Wed Nov 21, 2012 2:21 pm

Drew31 wrote:Curious... When you do rebalance, do you just rebalance to the middle of your range?
I have no set goal when I rebalance. Sometimes to middle of range, sometimes to top edge, sometimes to bottom edge. On RBDs, I have a special "rebalancing" written into my IPS, too.
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bertilak
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Re: Software to Automate Portfolio Rebalancing?

Post by bertilak » Wed Nov 21, 2012 8:04 pm

rustymutt wrote:I use a spreadsheet with formulas I've created to tell me the number of shares to get to the required % of any index. These %s can be easily changed as needed. I get the number of shares, and the dollar amount color coded to sell, or buy. As to automate the time of any re-balancing, I just wait til it's out of whack by 5%.
Hey! Have you hacked into my computer? Sounds suspiciously familiar, down to the buy/sell color coding!
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leonidas
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Re: Software to Automate Portfolio Rebalancing?

Post by leonidas » Wed Nov 21, 2012 11:27 pm

Drew31 wrote:
leonidas wrote:I used to use quicken and that had a rebalancing tool built into its investment section.
Also, I used fundmanager software during a trial and it did rebalancing too.
Was this quicken deluxe or premier?
This was premier. You can get it pretty cheaply on eBay. I got the 2011 version a couple of months after it came out for maybe 17 bucks.

Karamatsu
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Re: Software to Automate Portfolio Rebalancing?

Post by Karamatsu » Thu Nov 22, 2012 7:36 am

I'm amazed that it could take six hours. Maybe the real answer would be to consolidate your holdings into a more manageable set of funds/accounts? That sounds like a nightmare even with software to manage it. But I can see why you'd want some automation! Unfortunately I just use Excel so I'm not sure what would help.

STC
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Re: Software to Automate Portfolio Rebalancing?

Post by STC » Thu Nov 22, 2012 9:05 am

NateW wrote:Do any of you automate your portfolio rebalancing to get in line with your desired asset allocation? If so, what do you use? Ideally I am looking for a system where I download the data from each mutual fund account and I then get the allocation percentages and dollar amount by the fund categories of bonds, US, European, Pacific, emerging markets stocks, REIT, etc.

Presently, I manually key the data into a Excel spreadsheet into each fund category and it is extremely cumbersome since me and my wife have several different Vanguard target date funds in different accounts. Before the data is keyed in, the target date fund balances are manually calculated into the eight or so different fund types in each account and then added to like types. We also have many other funds, some of which have more than one category of stocks, i.e. VG Total International Stock Market and various American Funds mutual funds. I spend about six hours on the calculation every time I rebalance. There has to be an easier way. I figured many of you would know what the easy, simply, painless way to rebalance is. Thanks.

--Nate
I built a spreadsheet to automate this. Happy to email if you like. PM me.

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