Is this a good portfolio?

Question

For myself I have KO,WFC,VTI,WMT,AGG. Each has $1000 worth of shares.

For my 5 y rold she has vTI, Spdr , qqqq, KO and AGG. I also bought $1000 share of each for her.

Is her portfolio good enough to where she will have enough for college by the time she is 18 and is mine good for some extra money on the side?

OK extra info. I am 30 and have just started investing this year. By extra money I mean say for a trip or something like that. Or like an extra savings account with better interest. Nothing big. We also have savings bonds (I and EE) that are collecting dust. I just want to basically have something for rainy day.

Answer 1

Your basic "portfolio" is better than most. It is missing some of the key aspects of a good "asset allocation";
International Funds (I believe 20 - 25% would be good).
Mid Cap Funds
Small Cap Funds (no Penny Stocks).
I'd stick to more diversified funds or index's.

Check out basic books on investing or Mutual Fund Investing.
The "dummy" series has some good ones. It's worth the effort.

The qqq's are still less than 50% of their value in March 2000. This is an index which most professionals would keep away from for a "Buy and hold" investement.

A $5000 portfolio in 15 years, earning an average return of 9% will be worth $10,000.

What you're doing is great!!!!!! Please take more time to understand the road to investing through "Asset Allocation" and dollar cost averaging.

Answer 2

Depends on where she goes to college and how much extra money on the side you expect..(and when)..

For her, personally I think you have too many conservative stocks (ie, AGG is a bond fund. It's not where I'd park money for 15 years and expect to get much of a return) and funds..Other than the QQQQs, which is the Nasdaq PShares, and maybe Coca-Cola. With 13 years to go until she's ready to go to college, I'd be in much more riskier investments, realizing that I might have a few down years mixed in, but over the long run, you'd do better than a bond fund any day.
You also could use some international exposure, so maybe an International Agressive stock fund could work.

As far as your portfolio, since I dont know when you want some "extra money on the side" (honestly I dont know what that means), your portfolio should grow around 6-8 percent a year including dividends. So if that is what you need, you'll be OK.. Again, personally I would diversify a bit more unless you MIGHT need the money sooner rather than later..and if you happen do need it during a down period (like this week), you could get hurt.

Good reading material is Barrons, The Wall St Journal and Investors Business Daily...all available at local libraries.

Good Luck
ED

Answer 3

I really like KO right now. But I am very nervous about the financial sector, and would probably stay away from WFC. WMT seems like a good safe play right now.

Learning as much as possible about investing will be helpful in the long run. You might want to create a "practice" portfolio at http://www.top10traders.com - it's free - each month the site ranks the best performing investors.

Good luck.

Answer 4

You wouldn't listen to my advice anyway

Good luck to you and daughter