Calculator Inputs
Enter up to six assets. The page keeps a single-column structure overall, while the calculator area uses three columns on large screens, two on medium screens, and one on mobile.
Example Data Table
| Asset | Current Value ($) | Target Weight % | Expected Return % | Volatility % |
|---|---|---|---|---|
| US Equity | 25,000.00 | 35.00 | 10.00 | 18.00 |
| International Equity | 15,000.00 | 20.00 | 8.50 | 20.00 |
| Bonds | 12,000.00 | 20.00 | 4.50 | 7.00 |
| REITs | 8,000.00 | 10.00 | 7.00 | 16.00 |
| Gold | 6,000.00 | 8.00 | 5.00 | 14.00 |
| Cash | 4,000.00 | 7.00 | 2.50 | 1.00 |
Formula Used
1) Current weightCurrent Weight_i = Current Value_i / Total Portfolio Value × 100
2) Normalized target weightTarget Weight_i = Raw Target_i / Sum of Raw Targets × 100
3) Target valueTarget Value_i = Total Portfolio Value × Target Weight_i
4) Rebalance amountRebalance_i = Target Value_i - Current Value_i
5) Expected portfolio returnPortfolio Return = Σ(w_i × Expected Return_i)
6) Simplified portfolio riskPortfolio Risk = √Σ((w_i × Volatility_i)²)
7) Concentration scoreHHI = Σ(w_i²)
8) Effective asset countEffective Assets = 1 / HHI
9) Allocation driftDrift = 0.5 × Σ|Current Weight_i - Target Weight_i|
This risk method is intentionally simplified. It does not include pairwise asset correlations.
How to Use This Calculator
- Enter each asset name and current market value.
- Add your desired target weight for every asset.
- Input expected return and volatility assumptions.
- Click the calculate button.
- Review current weights, normalized targets, and rebalance amounts.
- Use the Plotly chart to compare present and target allocations.
- Download the results as CSV or PDF for reporting.
- Recheck assumptions whenever portfolio values or targets change.
Frequently Asked Questions
1) What does portfolio weighting mean?
Portfolio weighting shows how much of your total portfolio sits in each asset. It helps you compare actual allocation with your desired strategy and spot concentration risk early.
2) Why are target weights normalized?
Normalization keeps all target weights consistent when their total does not equal 100%. This prevents distorted target values and gives cleaner rebalance instructions.
3) What does the rebalance amount show?
A positive rebalance amount suggests buying more of that asset. A negative amount suggests selling part of that position to reach the target allocation.
4) Is the risk figure fully realistic?
No. It is a simplified estimate using target weights and individual volatilities only. Real portfolio risk should also consider correlations, tail risk, and changing market conditions.
5) What is allocation drift?
Allocation drift measures how far your current portfolio has moved away from its target mix. Larger drift often signals a stronger case for rebalancing.
6) What is the effective asset count?
It is a diversification indicator derived from concentration. A higher value means exposure is spread more evenly across holdings instead of being dominated by one or two positions.
7) Can I use this for retirement or fund planning?
Yes. It works for retirement models, balanced funds, ETF mixes, and custom investment plans, as long as your input assumptions are reasonable and current.
8) When should I recalculate weights?
Recalculate after big market moves, new deposits, withdrawals, dividend reinvestments, or whenever your strategic targets change. Regular reviews help maintain discipline.