Asset Allocation Calculator
Analyze your portfolio's concentration risk and get personalized diversification recommendations.
Written by
Tyson Fuller, CFP®
Your Risk Score
14
/ 100
Low Risk
Diversification
86
/ 100
Risk Factors
0
Portfolio Details
Total Portfolio Value
Include all investment accounts: 401(k), IRA, taxable accounts, etc.
Largest Single Holding
8%
Target: ≤ 10%
On target
Top 5 Holdings Combined
25%
Target: ≤ 40%
On target
Largest Sector Exposure
23%
Target: ≤ 25%
On target
Employer Stock
5%
Target: under 10%
On target
Asset Class Breakdown
Stocks & Bonds
70%
Equities and fixed income investments
Real Estate
15%
REITs, rental properties, real estate funds. Typically 5-20% of portfolio.
Alternatives
10%
Commodities, crypto, hedge funds, private equity. Usually under 10% for most investors.
Cash
5%
Money market funds, savings accounts, CDs. Emergency fund plus investment cash.
Total Allocation
100%
Well Diversified Portfolio
Your portfolio meets all recommended diversification targets. Continue monitoring your allocation regularly.
Understanding Concentration Risk
What is it?
Concentration risk occurs when too much of your portfolio is invested in a single asset, sector, or geographic region, increasing volatility and potential losses.
Why it matters
Proper diversification helps reduce risk without necessarily reducing returns. The "don't put all eggs in one basket" principle applied to investing.
How to improve
Gradually rebalance your portfolio by selling overweighted positions and investing in underrepresented areas. Consider index funds for instant diversification.
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This calculator evaluates portfolio concentration risk by analyzing the distribution of holdings across individual positions, sectors, asset classes, and geographic regions. The risk score (0-100) uses weighted factors: largest single holding (max 25 points), top 5 individual holdings (max 18 points), sector concentration (max 18 points), geographic concentration (max 9 points), employer stock (max 24 points), and alternative assets (max 6 points).
Risk thresholds are based on financial planning best practices: individual holdings should not exceed 10% of portfolio, top 5 holdings under 40%, sector exposure under 25%, and employer stock under 10%. The calculator assumes current market values and does not account for tax implications, liquidity constraints, or individual circumstances beyond concentration metrics. Diversification scores and recommendations are educational tools only and do not constitute personalized investment advice. Optimal portfolio allocation varies based on age, timeline, risk tolerance, tax situation, and financial goals. This tool should be used as a starting point for discussion with a qualified financial advisor.