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Andre Nader's avatar

A lot easier to rebalance when you live somewhere without capital gains tax!

I wasn’t familiar with using HHI to score concentration risk.

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Sherry Jiang's avatar

For sure, Andre! I actually do have to account for capital gains since I am an American citizen, but I simplified it in this particular instance. I will use similar approximate numbers for the tax I'll pay this year as last year, as I also sold off a similar amount of Google shares. This is also why I don't tend to "buy and sell" too much or move funds between different accounts because capital gains can add up pretty quickly! For other folks in Singapore without capital gains tax, it's so much easier.

HHI is one way to look at concentration risk, similar to its usage for antitrust. Here's an article for reference! https://www.openriskmanual.org/wiki/Herfindahl-Hirschman_Index

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