My asset allocation needs a makeup
This might come as a surprise to many of you, but stocks are a small part of my net worth at the moment. I'm still learning and slowly allocating more money towards it.
I am not happy with my current allocation, especially the Virtual items part should shrink a lot.

I am deploying a lot of cash right now and I'm looking to get my stocks+ETFs up to 25-30% of my NW in this year. I was thinking about adding some Real Estate exposure via REITs in a seperate portfolio. Thoughts? I don't really have much knowledge in that area, but putting a few percent into that category sounds like a good idea to me.
Neil's avatar
By virtual items you mean? NFTs?
Josh Rozin's avatar
@stonkmetal Interesting! Have the items reacted during this downturn?
Stock Metal Investment's avatar
@josh I don't track them as closely (mainly because it's harder to track), but they are very uncorrelated to other asset classes. They've been holding strong, I think I'm up YTD or flat.
Stock Metal Investment's avatar
@couch_investor Yeah, that kind of stuff. I used to run a few promotions together with Dmarket 2 years ago actually haha.
Stanley's avatar
I’m a big fan of REITs myself. If you love receiving dividends REITs generally deliver; however there are definitely pros and cons.

If you don’t mind me asking, when you say “virtual items” are you referring to in-game items, NFTs?
Stock Metal Investment's avatar
@fatcatinvesting Thanks, I gotta read into it. I'm not the biggest fan of dividends, because I think capital can be allocated better (I do have dividend payers as well, most notably $TXN as my #5 position). I do also think that it would be a good diversification for an investment portfolio.
sam stribling's avatar
@stonkmetal I read your virtual items piece and am still frankly fascinated by it. That said, it seems you are able to produce (almost its own income stream based on your work) so you can continue to grow that. Why not take some of the profits from there to boost up your stock positions. I am partial to you holding onto your cash as we could be seeing a dead cat bounce on a day like today. However, I think that stocks deserve at least a 25% allocation. I would also go for less risky assets there considering, Crypto can be quite volatile, similar to @josh's question, I have no idea about the volatility of virtual items but would love to hear how they have held up over the last 6 months.
Stock Metal Investment's avatar
@strib Glad you enjoyed it, for sure it is fascinating. CSGO items were my first touching point with investing (I started 2014, 6 years before I started stocks and crypto, hence the size). The market has matured a lot since I started (growing from a few hundred million to a 15 billion dollar market). Back then I did a lot of trading with high arbitrage (10% a week was the norm, thats how I scaled a relatively small $ into something large over a few years). Nowadays sadly there are lots of players, both private individuals but also big websites, so most of the arbitrage is gone. I still hold them as part of my portfolio, but I keep extracting value to crypto and stocks. In 2020 it was 95% of my NW, so redistribution has come a long way. Eventually I want to have a 40-60% stock allocation, but that's a long way. I'll keep extracting value, but in sight of current market downturns in equities I might accelerate that process a bit.

Virtual items are pretty stable generally, largely from their illiquidity.
sam stribling's avatar
@stonkmetal if it’s been stable.. that’s fantastic. I agree sell the stability and buy this drop (its a bit bigger than a dip at this stage lol)

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