Give your portfolio a Sortino sanity check

Give your portfolio a Sortino sanity check

Back in 2012, to help readers choose an appropriate asset allocation strategy for their personal objectives and risk tolerance, Investors Chronicle suggested three models for 'cautious', 'balanced' and 'adventurous' investors ('The Ideal Portfolio', 11 May 2012). These looked at the approximate mix of shares, bonds, property, cash and other assets (eg, gold, stamps, fine wine, etc.) that each type of investor should aim to own. Revisiting the models, in the coming months I aim to create my own portfolios for each. As part of the process, I want to consider charges and also try to start with different hypothetical amounts to reflect alternative circumstances. After all, how a novice investor using their £15,000 Nisa allowance diversifies risk will be different to the average Investors Chronicle reader, who has a portfolio worth £789,402, according to our last commissioned research.

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