It's that time of year again when we are all gearing up for the holidays--busy making plans, buying gifts, and monitoring our spending.
It may also be the time of year when you re-evaluate your 401(k) or explore investment opportunities for the New Year. You can use the Morningstar Portfolio X-Ray to your portfolio by sector, stock type, geographical asset allocation, and much more.
The first step to performing an X-Ray is to input your holdings. Keep in mind you can enter funds, stocks, ETFs, and even cash into your portfolio. You can also enter the actual dollar amounts, or base it on percentages.
When you view the portfolio you will see an overall breakdown of the holdings. Think of this as the snapshot view of a mutual fund page. Here you will find asset allocation and the percent exposure of your overall portfolio by sector and stock type. You will also find expense ratio information, stock stats, and any international exposure.
Although the X-Ray Overview is impressive, just imagine if there was a financial professional there to explain those results to you. Well, if you go to the drop-down box and select Interpreter you get just that--an explanation of the data. This is an extremely helpful feature because it will point out any sectors or stock types that may be exceeding or falling short of the benchmark. Not only that, but X-Ray will also tell you what sort of asset mix you have and the investment horizon that will most likely suit the portfolio.
I recommend reading the Portfolio Strategies article on the Help and Education page of Morningstar Investment Research Center. The article is by our personal finance specialist and goes through five steps to give your portfolio a year-end checkup.
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