Guides / Investing: Allocation, Drift and Performance
What is portfolio drift from target allocation?
Portfolio drift is the gap between how your money is actually split across asset classes and the split you set as your target. It opens on its own, because assets grow at different rates, so a winning asset class takes up more of the portfolio than you planned. Drift changes your risk without any decision on your part, which is why it is worth measuring against a fixed target.
Drift in plain terms
Your target allocation is a split you chose on purpose, such as a set share in stocks and a set share in bonds. Your real allocation is what your accounts hold today. Drift is the difference between the two, asset class by asset class.
Picture a 60/40 target. After a strong run for stocks you hold 70/30. The portfolio has drifted 10 points toward stocks, and it is now riskier than the plan you set. The numbers are only an illustration.
Drift runs both ways. A rising asset class grows its slice and a falling one shrinks it. Either way, the mix you hold stops matching the level of risk the target was built to give you.
Why drift happens even when you do nothing
- Markets: asset classes rarely move together or at the same speed, so their shares shift every day.
- Trading: buys and sells inside the portfolio, whether yours or an automated strategy's, change the mix.
- Cash flows: deposits, withdrawals and dividends land in one place rather than spread across the whole target.
- Time: small gaps stack up, and a portfolio left alone for years can look nothing like its plan.
Because drift builds quietly, the useful question is not whether it exists. It is how big the gap is right now.
Why the target has to stay put
Drift only means something if the thing you measure against does not move. If you quietly reset the target every time the portfolio changes, the gap is always zero and tells you nothing.
A good target comes from your situation: how long until you need the money (your horizon) and how large a drop you can sit through (your risk). Write the reasoning down next to the number. When markets are loud, a written reason is easier to trust than a feeling.
Manu starts from exactly that. A short questionnaire about horizon and risk produces a target allocation with the reasoning attached, and Manu keeps that target as the yardstick for everything that follows.
How Manu shows the gap
In the Investing tab, Manu compares your real split with that stored target and shows the gap as it opens, as the bot trades and the market moves. The target does not shift to meet the portfolio, so the gap stays honest.
A few other numbers sit around the drift view and give it context:
- Net worth across your bank and brokerage accounts in one place.
- Performance per account, with values straight from the broker and an equity curve you can scrub.
- Returns measured net of fees and commissions, so costs do not hide inside the picture.
- Interactive Brokers as the broker today, with live and paper accounts side by side.
What Manu does not do
Manu shows drift. It does not rebalance for you and it does not place rebalancing trades. Trades come from the bot on your own server through your own broker account, and Manu is the control room for that bot. What you do about a gap stays your decision.
What to do when drift opens
Seeing the gap is the first half. The second half is a choice, and there is no single right answer. The usual options:
- Do nothing while the gap is small. Trading has costs, and a tiny gap rarely changes your risk in a way that matters.
- Point new money at the underweight asset class. The mix moves back toward target without selling anything.
- Sell some of what has grown and buy what has shrunk. This restores the target, but it can bring fees and tax consequences.
- Revisit the target itself only if your horizon or risk tolerance has really changed, not because of a good or bad month.
Pick a rule before you need it, such as checking on a set date or acting once a gap passes a line you chose. A rule made in calm is easier to follow than a decision made mid-crash.
Where Manu fits and what it needs
Manu is an iPhone app on iOS 26 or later, in private beta through TestFlight and free while in beta. It connects only to a server you run, and your data stays on that server. Drift is one part of the wider picture on the home page, alongside spending, budgets and the trading dashboard.
Manu is not investment, tax or financial advice. It shows you where your portfolio stands against the target you set.
Manu is in private beta. One iPhone app for your accounts, investing and a trading bot you run yourself, all against a server you own.
Frequently asked questions
Is portfolio drift the same as losing money?
No. A portfolio can rise in value and still drift, because one asset class grew faster than the others. Drift is about the mix, not whether the total went up or down.
How often should I check for drift?
Pick a rhythm you will keep, such as a set date each period, or act when a gap passes a line you chose. Manu shows the gap as it opens, so you can look whenever you like.
Does Manu rebalance my portfolio?
No. Manu shows the gap between your real split and your target and leaves the decision to you. Trades, if any, come from the bot on your server through your own broker account.
Where does the target in Manu come from?
From a short questionnaire about your horizon and risk. It produces a target allocation with the reasoning attached, and Manu keeps it as the yardstick for measuring drift.
Can I try Manu today?
It is in private beta, not on the App Store. You request access and get a TestFlight invite when a seat opens. It needs an iPhone on iOS 26 or later and a Vritam server you run.