Hi,
I am setting up a financial portfolio model. I have current/static portfolio data as of today - so, a list of stocks, bonds, private equity. In excel, I am forecasting returns for the next 10 years, so each asset class (or row) will grow at a certain rate. The sum $ total will grow from X to Y based on my growth assumptions. However, I am also trying to proactively change the mix of assets in each year. This means, each year, I need to buy more of some assets and sell others - basically solving for a "% of total" mix in each year. In calculating the buys/sells in each year, the equation becomes circular because I am referencing the sum of all the assets in a given year while also trying to solve for the % of those very same assets that an individual asset class should be. I cannot figure out a way to do this without blowing it up with the circular reference. Please help!
Thanks in advance!
I am setting up a financial portfolio model. I have current/static portfolio data as of today - so, a list of stocks, bonds, private equity. In excel, I am forecasting returns for the next 10 years, so each asset class (or row) will grow at a certain rate. The sum $ total will grow from X to Y based on my growth assumptions. However, I am also trying to proactively change the mix of assets in each year. This means, each year, I need to buy more of some assets and sell others - basically solving for a "% of total" mix in each year. In calculating the buys/sells in each year, the equation becomes circular because I am referencing the sum of all the assets in a given year while also trying to solve for the % of those very same assets that an individual asset class should be. I cannot figure out a way to do this without blowing it up with the circular reference. Please help!
Thanks in advance!
