In this 2024 asset allocation article, I will share my year-end allocation in both Malaysia and foreign markets.
Target asset allocation
Malaysia
My target allocation is 10% P2P lending and 90% stock.
I am only considering equities, mutual funds and peer-to-peer (P2P) lending.
Foreign
My current target allocation is 20% in bonds, 74% in equity and 6% in alternative assets.
My investment assets in foreign markets are made up of exchange traded funds (ETFs) and mutual funds. A portion of these investments is on the robo-advisor platform, MYTHEO. My investment on MYTHEO consists of three portfolios, namely growth, income and inflation hedge. For simplicity sake, I am going to group income and inflation hedge into bonds.
Malaysia vs foreign
My target allocation between the local and overseas markets is 70% and 30%.
2024 asset allocation
Malaysia
My investments in Malaysia are divided into P2P lending (7.55% vs 2023: 7.68%) and stock market (92.45% vs 2023: 92.31%).
My top three holdings are still MAYBANK (24.61%), PAVREIT (14.09%) and UCHITEC (12.02%).
This is still my ideal allocation as I have given myself a leeway of ±5%.
Foreign
My investment assets in foreign markets are 20.60% bonds (2023: 19.30%), 76.29% equities with cash (2023: 76.23%), and 3.11% in alternatives (2023: 4.47%). I consider this allocation to be within my target as I have given myself a leeway of ±5%.
The table below shows the countries that I have equity exposure with their percentages in my foreign portfolio (including a mutual fund on Fundsupermart and my portfolio on Firstrade but excluding my portfolios on MYTHEO).
| Stock | Percentage |
|---|---|
| Cash | 8.73% |
| China | 18.63% |
| India | 11.41% |
| Indonesia | 5.01% |
| Singapore | 11.69% |
| US | 31.04% |
Current asset allocation between Malaysia and overseas
As on 31 December 2024, I have 77.86% (2023: 77.04%) of my total investment assets in Malaysia and 22.14% (2023: 22.96%) in the foreign markets. It is still not my target allocation yet (70% Malaysia/30% foreign markets).
Conclusion of 2024 asset allocation
I still have not attained my ideal allocation between local and foreign markets yet. Though I focused primarily on the foreign markets last year, my local allocation has increased due to the positive movement in Malaysian market. In 2025, I require fund for my house renovation and I have decided to withdraw some money from my local portfolio. Thus, the value of my local portfolio will decrease. As long as the house is not ready yet, I think I would not have much cash to invest. I am quite optimistic that my allocation will reach my ideal ratio in 2025.
Asset allocation is an important determinant of the eventual return of a portfolio. I hope that my allocation will give me the return that I target, which is at least 7% per annum. I have achieved this target in 2023 and 2024.
Invest and prosper!
