I have been reviewing my portfolio's sector weightings as 2015 is coming to a close. Each year I like to pick three sectors that I think might do well in the coming year and that I should strive to overweight within my portfolio by selecting some mutual funds that are overweight these selected sectors. To do this I study what I own and what adjustments might be necessary to achmploish this by using Moringstar's Instant Xray analysis. For the coming year I have chosen to overweight financials, technology and energy.
For me, I have the sectors in the S&P 500 Index divided into seven major and four minor sectors. The minor sectors would be materials, real estate, communication services and utilities. The major sectors would be consumer cyclical, financial, energy, industrials, technology, consumer defensive, and healthcare. I strive to maintain a weighting in the minor sectors of at least five percent each and the major sectors of nine percent each. This leaves about seventeen percent that can be moved around from these base weightings to overweight sectors of my choice and to also allow for some movement from these base weightings.
In addition, form a style cap orientation perspective, I favor about a sixty five percent weighting to large caps, 25% to mid caps and 10% to small caps; and, from a world region perspective, I favor about 60% to the Americas, 25% Greater Europe and 15% to Greater Asia.
With this, I am wondering what others might be thinking of doing within their own portfolio(s) for 2016?