Portfolio allocation converts a target percentage mix into actual amounts of capital. This calculator divides a portfolio among stocks, REITs and cash according to the percentages you enter. It performs the allocation arithmetic only; it does not decide which mix is appropriate for your objectives, time horizon or tolerance for investment risk.
How it works
Enter the total portfolio capital and the percentages you want assigned to stocks, REITs and cash. The three percentages must add up to exactly 100%. The calculator multiplies the total capital by each percentage to show the amount assigned to each asset group and confirms the total allocation.
The formula
Portfolio capital is the total amount being allocated. The stock, REIT and cash fields are target percentages rather than expected returns. A higher or lower percentage does not imply that an asset is safer, more profitable or more suitable for a particular investor.
Worked example
For a portfolio of 100,000 with 50% in stocks, 30% in REITs and 20% in cash, the calculator allocates 50,000 to stocks, 30,000 to REITs and 20,000 to cash. The three amounts total 100,000 and the allocation percentages total 100%.
Portfolio allocation is a planning tool, not a guarantee of performance. Review the suitability and risks of each asset class separately before making an investment decision.
Frequently asked questions
Why must the percentages total 100%?
Because the calculator is distributing the entire entered capital among the three asset groups. A total below 100% would leave part of the portfolio unallocated, while a total above 100% would allocate more capital than is available.
Does the calculator recommend the best portfolio allocation?
No. It converts percentages you choose into monetary amounts. Choosing an asset allocation requires considering goals, investment horizon, liquidity needs, diversification and risk tolerance.
Does this calculator predict portfolio returns?
No. It does not use expected returns, volatility, dividends or market forecasts. It simply calculates how much capital corresponds to each percentage.