Investment Portfolio Grader
Grade your portfolio across 6 dimensions, visualize your risk/return on the efficient frontier, see how much fees are costing you, and get a specific rebalancing action plan. Free, no login, runs 100% in your browser.
What Is a Portfolio Analyzer?
A portfolio analyzer is a tool that evaluates your investment allocation across multiple dimensions — diversification, risk calibration, fee efficiency, age-appropriateness, growth potential, and concentration risk. Unlike simple pie charts in brokerage apps, a true portfolio analyzer grades your holdings against benchmarks and gives you actionable insights. This tool uses Modern Portfolio Theory (MPT), the Herfindahl-Hirschman Index for diversification scoring, and embedded historical return data spanning 20 years (2004-2023) to backtest your allocation against the classic 60/40 benchmark and the S&P 500.
How Asset Allocation by Age Works
The classic guideline is “110 minus your age” for stock percentage. At age 30, that means roughly 80% equities and 20% fixed income. At 50, it shifts to 60/40. The logic is simple: younger investors have more time to recover from downturns, so they can tolerate higher volatility for higher expected returns. Risk tolerance matters too — a conservative 30-year-old might allocate like a moderate 45-year-old. This tool calculates your age-appropriate target allocation and scores how well your current portfolio matches it.
Understanding Portfolio Diversification
Diversification reduces risk without sacrificing return by combining assets with low correlation. The Herfindahl-Hirschman Index (HHI) quantifies concentration: it squares each asset's weight and sums them. An HHI below 0.20 with 4+ asset classes each above 5% indicates strong diversification. A portfolio with 80% in US stocks has an HHI around 0.65 — highly concentrated. Adding international stocks (correlation 0.75 with US), bonds (correlation -0.05), and REITs (correlation 0.55) dramatically reduces overall portfolio risk while maintaining expected returns.
How Investment Fees Drain Your Returns
The expense ratio is the silent killer of portfolio growth. A $100,000 portfolio earning 8% annually with a 0.50% expense ratio grows to $761K over 30 years. The same portfolio with a 0.03% expense ratio (Vanguard Total Stock Market Index) grows to $906K — that's $145K lost to fees. The compounding effect is devastating because fees reduce the base every year, so you lose not just the fee amount but all the growth that money would have generated. Most actively managed funds charge 0.50-1.50% and rarely outperform their index benchmarks after fees.
The Efficient Frontier Explained
Modern Portfolio Theory, developed by Harry Markowitz in 1952, shows that for any level of risk there exists an optimal portfolio that maximizes expected return. The efficient frontier is the curve of all these optimal portfolios. If your portfolio plots below this curve, you're getting less return than possible for your level of risk — or taking more risk than necessary for your level of return. This tool generates the efficient frontier using stock/bond combinations and plots your actual portfolio against it, showing exactly how far from optimal you are.
How to Rebalance Your Portfolio
Rebalancing means buying and selling assets to return to your target allocation after market movements cause drift. Most advisors recommend rebalancing when any asset class drifts more than 5% from target, or on a regular schedule (quarterly or annually). This tool calculates the exact dollar amounts to buy and sell for each asset class, prioritized by largest deviation first. Tax-conscious investors should prefer rebalancing in tax-advantaged accounts (401k, IRA) to avoid capital gains taxes.
Frequently Asked Questions
What is a good portfolio allocation for my age?
A common rule is 110 minus your age in stocks, with the rest in bonds and cash. At 30, aim for about 80% equities. At 50, about 60%. Aggressive investors may add 10-15%, conservative investors subtract 10-15%.
How much should I have in bonds at 30, 40, or 50?
At 30: 15-25% bonds. At 40: 25-35% bonds. At 50: 35-50% bonds. These ranges account for different risk tolerances. The key is gradual increase over time as your investment horizon shortens.
How do I check if my portfolio is diversified?
Count your asset classes with meaningful allocation (5%+). If you have 4 or more — US stocks, international stocks, bonds, and at least one alternative (REITs, commodities, or cash) — with no single class above 40%, your diversification is strong.
What expense ratio is too high?
Anything above 0.50% is high. Most broad market index funds charge 0.03-0.10%. The difference compounds dramatically over decades. Check this tool's Fee Drag calculator to see the exact dollar cost of your current expense ratio.
Should I include crypto in my portfolio?
A small allocation (5-10%) may improve diversification due to low correlation with stocks and bonds. However, crypto's extreme volatility (60%+ annual standard deviation vs 15% for stocks) means it significantly increases overall portfolio risk. Only appropriate for investors with high risk tolerance and a long time horizon.