Asset Allocation Software for High-Net-Worth Individuals.

Guideline Asset Allocation Mix Calculators
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Current, Guideline, & Proposed Mix Comparators
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Investment Portfolio Forecasters
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Statistics Calculators

Summary

This Excel-based asset allocation software is used for matching an investment portfolio to an individual investor's life.

For investors managing their own money, you are the client in the text below.

For investment advisors: After fact finding, you input client life factors to calculate the recommended percentages of eight major asset classes.

Then you input assets currently held. The difference between what they should hold vs. currently held is displayed.

Then you shuffle investments around in the proposed section to generate the recommended portfolio.

You can input future assumed rates of return, changes to the mix, contributions, and withdrawals to project portfolios into the future.

The usual asset allocation information, charts, and portfolio statistics are then displayed for evaluation.

Program Operation in Detail

The color-coding and arrangement of the major asset classes makes it easier to understand. Asset classes go from safe to risky as you read left to right. Also, safer asset classes are blue and risky assets are red.

The first three sheets calculate an investor's general asset allocation guideline. In English, what percent they should hold in each major asset class; like cash, bonds, stocks, and international.

Each allocation mix calculator uses slightly different life factor combinations to calculate the recommended mixes. There is a matrix for working individuals (and couples without children), working families, and retired investors.

These mix calculators use the five most important life factors that determine how someone should spread their money between major asset classes. The most important is investment risk tolerance category, found by using an investment fact finder.

These matrices generate ~1,000 different asset allocation mixes - more than any other asset allocating program. This is why there are no historical returns posted, like there are for the investment models.

After calculating the recommended allocation mix, you then input currently held assets. Here you can account for all of the investors' holdings at the same time (all personal and tax-qualified accounts for everyone).

Other investment software can't accommodate this, so important investments are usually left out. This discombobulation causes many problems, resulting in sub-par performance.

The calculated portfolio mix is then compared to the allocation mix currently held. Discrepancies display in both dollars and percentages for each asset class. This guides shuffling assets around to reach the proposed allocation mix, and justifies replacing poorly-performing investments. The proposed new portfolio can be as close to the calculated mix as you want. It can be way off to accommodate various constraints, and that's fine.

It shows how much money is in personal, qualified, and combined portfolios by asset class. It generates guideline, current, and proposed pie charts to show where the portfolio is now, where it should be, and how to get there.

Portfolio Projections and Forecasts

These sheets provide complete control over all parameters 75 years into the future. No other investment software allows you to evaluate portfolios in this much detail.

The Future Data Input sheet allows total control of:

° Contributions and withdrawals by asset class in each of the 75 years. Totals are displayed by asset class.

You can control exactly where money comes from and where it goes every year. This allows you to evaluate strategies like living off fixed income during retirement, while letting equities grow untouched.

° It allows you to change the asset class mix for both current and proposed portfolios independently in each of the 75 years. This is useful for evaluating strategies like becoming more conservative in later years.

° You have total control over how both current and proposed portfolios grow. In each of the 75 years, you can set the rate of return to be different for all eight asset classes. This automatically performs annual rebalancing because it takes the ending year's balance, and then divides it by the manually input mix (or defaults to the base mix), when it calculates the next year's allocation.

Being able to control these three parameters allows you to evaluate the long-term effects of different investment strategies like no other investment software can.

After this future data is input, you can see the annual results on the Asset Class Returns Forecaster sheet. It displays:

° 75 years of growth, after contributions and withdrawals, using different assumed asset class returns and allocation mixes.

° Both the weighted and unweighted returns of current and proposed portfolios.

° Both dollar and percent change of current and proposed portfolios from the previous year.

This sheet makes it easy to compare different scenarios, because it combines all future assumptions together in a logical format.

The Asset Returns sheet allows you to enter a different rate of return for every asset independently. It displays:

° Each asset's percentage of all personal and qualified assets, and the total portfolio. This is also shown for current and proposed portfolios.

° Both weighted and unweighted returns of current and proposed portfolios. This is also broken down into personal and qualified.

° The percentage both personal and qualified portfolios are of the combined portfolio. This is also shown for current and proposed portfolios.

° Comparisons of current and projected portfolio rates of return so you can see the effects on the whole portfolio when you swap out just one asset.

The Asset Forecaster sheet then uses this asset level data to forecast the portfolios for 75 years, both in numeric and graphical form. This enables you to evaluate the long-term effects of making one trade.

Portfolio Statistics Calculators

This is very scaled-down version of most portfolio optimizers/analytics software selling for over $1,000. It displays:

º The custom reference asset's: Beta, Alpha (Jensen), R-squared, Treynor Ratio, and Sharpe Ratio. The reference used for these comparisons can any of the four benchmarks (S&P500, Lehman Aggregate Bond, MSCI EAFE, or the custom benchmark that you manually input).

º Statistics from a user-defined benchmark index. This allows you to compare the custom reference asset to anything you want.

The custom benchmark index, and/or the custom reference asset, can be one asset or a portfolio of hundreds.

This allows you to input assets to see how they've moved compared to the major asset classes (or the custom benchmark) over selected time frames. This helps decide whether or not adding the asset will make a portfolio better or worse (AKA more efficient or optimized). If it has low correlations and good returns, then adding the asset will reduce the portfolio's overall risk and probably increase returns at the same time.

º Correlation coefficients (r) of the reference asset compared to the S&P 500, Lehman Aggregate Bond Index, the MSCI EAFE Int'l stock index, and a custom benchmark index.

Calculating these numbers was the main reason for building the sheet - to let you input assets and see how they've moved compared to the major asset classes over time frames that you can select (on a quarterly basis going back to 1976).

This is the major factor that goes into deciding whether or not the adding the asset will make an investment portfolio better or worse (AKA more efficient or optimized). If it has low correlations, and decent returns, then adding the asset to the portfolio will reduce the portfolio's overall risk, while more than likely increasing its returns, at the same time.

º Average/Median/Minimum/Maximum rates of return and standard deviation over the selected time frame.

º Growth of any amount of money over the selected time frame. This displays similar information as Ibbotson charts showing "Growth of $10,000" since a very long time ago. It's updated monthly for the S&P 500, Lehman Aggregate Bond Index, MSCI EAFE Int'l stock index, our Moderate Model, and our Moderate Model funded with benchmark indices.

º Our Moderate Asset Allocation Model's monthly returns (since inception of January 1999) are input monthly into the Reference Asset's input area. This is so you can see the portfolio statistics of a portfolio that's being used in the Real World.

Then the same Moderate Model funded with appropriate benchmark indices is input into the Custom Benchmark area. This allows the proper calculation of portfolio statistics, like alpha, of our investment strategy.

You would delete these returns and input data for portfolios, or assets, you're evaluating.

Graphs

16 graphs are set to display 25 years of data, and you can change them to display any range in the 75-year window. They are all totally under your control, and show:

° Growth of both current and proposed portfolios by asset class. It uses a stacked area graph so you can see detailed growth by asset class.

° A simple graph to show current vs. proposed annual portfolio values.

° An annual net contribution and withdrawal graph.

° A bar graph to display current and proposed annual rates of return.

° Pie charts showing asset allocation mix snapshots.

° Four-asset class mix tables for current, guideline, and proposed portfolios.

° Forecasted current and proposed allocation mix pie charts for years 5, 10, 15, and 20. You're able to change which years they display.

Unique Strengths of this Asset Allocation Software

We listened, and all of the features you've been asking for are done. We looked at everyone else's websites, demos, and asset allocation software, and implemented everything that everyone else is doing. So if you can think of a feature that isn't on the demo, and doesn't have anything to do with going online, a portfolio optimizer, or database of historical returns, then you'd get a free copy (if we decide to add it).

· The most valuable feature, that other vendors don't have, is that it allows you to produce portfolios that are ready to be implemented in the Real World.

All other investment software, like Morningstar, gives you the tools to manage money by evaluating current and proposed portfolios, but does not create them for you. The investment manager still needs to develop a system to do the work of portfolio management before they can use the software to evaluate it. In other words, you have to somehow create the recommended portfolio on your own, and then manually input it, to create presentation and proposal data. Ours is the only turnkey system that will take you step-by-step to the end result of using mutual fund ticker symbols to implement investment portfolios.

Other than having a database of historic asset returns, being able to import data from the web, and a portfolio optimizer, this investment software does everything, and more, compared to other vendors. To get these missing functions requires spending $500 to $2,000 more (and then about half of that annually to keep it working. We don't charge annual update fees).

We use Morningstar Principia for their mutual fund database, and that's all (because it's mostly useless for doing any meaningful portfolio management work). It costs around $600 annually, and they raise their prices every year. The point is between Principia and our software; you're able to perform most all needed portfolio management functions. If you just have Principia, then you will have to develop your own money management methodology to do anything with it. Our investor software gives you a great investment strategy, but doesn't have the database needed to evaluate investment vehicles used. You're set when you have both.

The only other thing you may need is portfolio management software. What you don't need is a portfolio optimizer or a Monte Carlo simulator. Read about the pros and cons of inputting data manually vs. having software that will go online to access client holdings.

· Detailed accounting of everything investors hold is needed to match portfolios to their lives. Being able to input and evaluate an investor's total holdings, and not being limited to only investments the vendor allows or is in their database, is extremely valuable. This is also critical for managing risk.

With our investing software you're free to use individual securities (stocks and bonds), ETFs, real estate, life insurance sub-accounts, closed-end funds, index funds, CDs/checking accounts, 401(k) funding options, non-publicly traded securities, coin collections, or any kind of derivative like options.

This is the only investment software that will allow you to account for and evaluate an investor's complete picture all at once. When you only account for investments that you're getting paid for, this tips investors off that you only care about making money from them. When you account for everything, then it tips them off that you care about them as clients.

· This is the only asset allocator that gives you complete control over the process.

You can rename the eight major asset classes to be whatever you want, instead of being stuck with what the vendor limits you to. You can also delete or add major asset classes.

Inside of the major asset classes, you can use unlimited sub-asset classes. For example, inside the far right major asset class we recommend mutual funds for seven sub-asset classes.

You can define what life criteria are used to calculate the mix, and what the mix of asset classes will be, by changing the numbers on the calculation matrices. Recommended allocation mixes are now under your control.

This means you can show people how they were generated instead of having to say, "I don't know why you should have 10% in high yield bonds, the computer did it!" People prefer transparency to mysteries, so this will help raise your closing ratio.

· You are free to have your proposals be different than what the program recommends. Other investing software only prints out hard-wired presentation data. With ours, you can use your own judgment to modify the program's recommendations (which is why they're called guidelines).

Once the current portfolio is input, then you shuffle assets around in the proposed section until what you recommend matches the guideline asset allocation mix. The accuracy is up to you. You can propose holding 12.1% or 50% of something when the calculated mix calls for 20%, and it doesn't matter.

Being off like this helps wake people up if they don't want to sell a large holding that they should. If they insist on holding too much of something, having the report show their mix being way out of balance usually results in them reconsidering. In most cases, the wise one reads the text that explains the reports, and wakes the stubborn one up. You make more money when this happens, because it means more assets under your management.

· You have complete control over making the program fit your way of doing things. You can edit, move, add, delete anything; insert text or pictures of people smiling, or whatever you want to make it work for you. With other investment software, all you can do is input, click print, and then you're stuck with whatever it prints out.

This allows you to control any Real World situation that will come up. Now you can manage money, and investment managers, the way you want without any limitations. This allows clients to understand what you're doing.

· The level of detail when it comes to breaking down investments into asset classes is up to you.

You can distribute the contents of an investment like a mutual fund into asset classes it actually holds, or just ignore it by putting everything into one asset class. For example, if a large-cap growth fund is really 5% cash, 10% value, 75% growth, and 10% int'l stocks, you can account for this detail. Or you can put 100% into the large-cap growth bucket to keep it simple.

· You also have total control over how both current and proposed portfolios grow in the future, because you control each asset class, or each investment, over a 75-year window. This accounts for contributions, withdrawals, changes in asset class mix, and rates of return.

· It's visually logical and makes more sense than other investment software.

Assets that are slated for reduction or sale are one color, and investments that are slated to be bought or added to, are another. This color-coding makes it easy to understand and then convert recommendations into trades.

The differences in the projected current and proposed portfolio values stand out like a sore thumb. This makes it fast, easy, and logical to get bottom lines across.

Investors:

This will save you thousands annually paid to investment advisers doing similar things, but not nearly as well. The results are unique, personal, and custom investment portfolios that you can create and implement yourself. There are step-by-step directions and you can buy support to get help.

Check out the investor model's returns, which are similar, and then compare to what you've been getting yourself, through an advisor, or by using other investing software. We think you'll get better returns with lower risk using this.

You can do this important work yourself, or hire us for around half of investment advisor's usual hourly rates.

Professional Money Managers and Financial Planners:

There are no annual updating or support fees with this allocator software. If you don't subscribe to keep the mutual fund picks updated, then you only pay once.

Forget about all of the cumbersome limitations with other investment software. Get better results for a fraction of the price, while being able to accommodate any client situation or way of doing business. It's not as seamless to use, but clients understand and like it a lot more.

People tend to let you manage their money when you can show them you actually have a plan for doing so that makes sense - and will deliver good returns with low risk. Being able to present prospects with something they agree with is not only what makes sales, but will also get results they expect. This will keep them with you as happy paying clients' years after the first portfolio is implemented.

This investing software also lets you use only your favorite mutual fund families. For example several mutual families, like Fidelity, Vanguard, T. Rowe Price, and Oppenhiemer, have over a dozen asset classes. You can modify the program so you don't have to use other asset classes or mutual fund families.

You also don't need a FINRA Series 7 license to manage money using these asset allocator tools. A Series 6 is all that's required.

As you may know, most every investing strategy your BD wants you to use ends up getting lousy investment performance. So if you're interested in using this asset allocation software (and/or the mutual fund selections), but think your Broker Dealer won't approve it; there's still hope. First, submit it for approval and see what they say. If they don't approve it, then here's what you can do:

Gather the data needed for input into the software using any investment fact finder that's approved. Print it and keep it on file. Then use the software at home and write the bottom line trades down. When you get back to the office, make the trades and manage the portfolio as usual. Just don't show, print, or give any of the reports to anyone. Don't tell anybody, don't put anything in their file (at home or at work), and nobody will ever know. You'll get the same great results as if everyone had hard copies.

People will think you're a genius and will wonder how you're doing it. Just tell them you use a little of this and a little of that and you're a good mutual fund picker. This is the same generic investor strategy everyone else is using anyway, so they'll think you're doing the same thing but are just better at it.

The only difference is that clients won't have printed reports. If what you're limited to using doesn't have printed reports of value anyway, then they won't be missing anything. This way you can get the low risk and great returns by funding a pure asset allocation strategy with mutual funds, and you'll minimize the whole compliance annoyance and/or getting into trouble.

You can then input current and proposed portfolio data into Morningstar if you want to give or show people approved reports.

Download the Demo

For downloads, right click on the links below, then choose "Save (Target) As..." to save to a folder on your hard drive. Then open it with MS Excel or Word. Sometimes the WPP's server doesn't work well with weird browsers, or it just may not work if it's not configured right. Plus you won't be able to print well from your browser. Please send e-mail if you have any problems, and it will be sent to you. Answers to frequently asked demo questions, and how to use demos.

Download the 750Kb non-functional Asset Allocation Software "demo." The actual program is ~2Mb.

The pages on PDF #1 of the free sample comprehensive financial plan print better than the demo

Download a 100Kb Word doc that explains asset allocation and the reports

It helps to have the directions printed out while you look the demo over

What You'll Get

· The big comprehensive asset allocation tool.

· The small asset allocator tool, which uses the same methodology but only has five asset classes. It also does not have the Sources and Applications of Funds section, forecasting sheets, or portfolio statistics calculators. It's not shown in the demo, but one will be included in your order as an example.

· The current month's mutual fund picks are included even if you choose not to buy the annual subscription service.

Differences between asset allocation models and this comprehensive asset allocation software:

Unlike allocation models, which exist before someone is around to invest in them, the investor submits various life factors needed to calculate a custom allocation mix that reflects their life situation. So this is not just using one of a few generic pre-existing model allocations.

The asset allocation software displays detailed current and proposed snapshots, and detailed future projections of both current and proposed portfolios. Model portfolios only show generic investment recommendations (proposed snapshot), so there is no data inputting involved.

Model portfolios only take one life factor into account - investment risk tolerance category. Once you know it, then there's little to no "work" involved. You just allocate money according to the appropriate allocation model, and then make the trades. So from an investment manager's point of view, model portfolios are best suited for smaller clients (e.g., under $200,000).

The comprehensive asset allocation software uses investing risk tolerance as the most important factor, but it also uses others. So there's work involved in creating an investment portfolio that's custom tailored to fit the investor's life. This makes it best suited for larger clients that are paying enough to make it worth doing the extra work (or investors managing their own money).

Our portfolio models use 16 asset classes, and the asset allocation software accommodates an unlimited amount (we screen mutual funds for 21).

The asset allocation software costs more because it provides more value.

You can create model portfolios with this asset allocation software just by creating the mix in the current section, and then saving it as a model portfolio.

Why aren't you taking advantage of this? Send e-mail and if you have an interesting reason, then you may get a freebie.

Disclaimer: This financial plan software is designed to allow financial planners, investment managers, other financial services professionals, and investors, to demonstrate and evaluate various financial strategies in order to help achieve their clients', or their own financial goals. There are no guarantees that any of the software will perform this function. The investment choices and services on this site are provided as general information only, and are not intended to provide investment, tax, legal, financial planning, or other advice. This site is for information purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any security, which may be referred herein. Mutual fund recommendations made are suggestions only, and customers should evaluate the suitability of each fund for their own holdings on their own or seek professional advice. Consult with your financial, legal, or tax advisor with regard to your individual situation. Toolsformoney.com is not engaged in rendering legal, accounting, tax, or other professional advice. In no event shall Toolsformoney.com be liable to customers for any damages whatsoever, including lost profits or savings, missed gains, or other incidental or consequential damages arising out of the use, or inability to use, any of the software or information obtained from this website. Financial estimates are generated by using many assumptions made by the program, clients, and the user. No person or software program can predict the future with any degree of certainty. No warranty as to correctness is given and no liability is accepted for any error, or omission, or any loss which may arise from relying upon data generated from reports produced by this program. In no event shall Toolsformoney.com be liable to you or any other party, for any special, consequential or incidental damages suffered by you or such other party as a result of any problems that may arise because of the installation or improper use of this software or presentation of reports produced by this software. All reports generated by this financial software are only rough estimates of many possible future scenarios.

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Asset Allocation for 401(k) / 403(b) and Similar Retirement Plans

Asset Allocation Software Prices They all come with one-time mutual fund picks This isn't the investment models, which are here	Unsupported	With E-mail Only Support	With E-mail and Phone Support
Comprehensive Asset Allocation Package	$158	$178	$188
Comprehensive Asset Allocation Package with one year of 93 monthly updated Mutual Fund Recommendations	$207	$228	$238
Comprehensive Asset Allocation Package with Investment Fact Finder	$177	$198	$208
Comprehensive Asset Allocation Package with one year of 93 monthly updated professionally selected Mutual Funds, and Investment Fact Finder	$229	$248	$259