Tutorial: run a quarterly portfolio review
The review exists so that you have permission to ignore your portfolio for the other eighty-nine days.
Replace constant anxious checking with a scheduled, structured, unemotional review.
How run a quarterly portfolio review works, in one picture
The same argument as the text, as a chain. Each step is what makes the next one possible.
The market moves first, and recovers first
Shares fall before the data does and start climbing while the news is still uniformly awful. Waiting for the news to improve means buying after the recovery has happened.
- 1
Reread every thesis before you look at any price
Order matters enormously. If you look at the returns first, you will assess the thesis through the lens of how the stock has done, which is precisely the bias the document was written to defeat.
- 2
Ask, of each holding, whether you would buy it today
Not whether you are up or down on it. Whether, knowing what you now know, at today's price, you would open the position. If the honest answer is no, you are holding it out of inertia or embarrassment, and both are expensive.
What you paid is irrelevant to what you should do next. The market has no idea what your entry price was.
- 3
Check the allocation drifted
Compare the actual split to the target you wrote down. Rebalance if it has moved materially. Do not rebalance because something feels toppy.
- 4
Then close the laptop for three months
Checking a portfolio daily does not improve returns and reliably damages them, because it converts volatility, which is noise, into anxiety, which produces action. The most valuable investing skill is the ability to do nothing on purpose.
You have a recurring date, a written checklist, and no reason to look in between.
Read next
The review exists so that you have permission to ignore your portfolio for the other eighty-nine days.
Every one shows its exact method, and the circumstances in which it is wrong. Free, and no account to look.