Now that the year is drawing to a close, it is advisable that individuals consider reviewing their yearly portfolio performance.

This year has been a tumultuous one, starting with poor market performances, a mid year recovery with a summer bond meltdown, and then the long awaited recovery in the markets with a brighter optimistic outlook for 2004.

The major difference in individual portfolios now, relative to one year ago, should be a considerable change in asset allocation, meaning that the percentage of assets within the categories of bonds, stocks, and cash has altered considerably. One year ago, bonds were in favour as the market return for equities was dismal.

Financial advisors were advising clients to have an allocation of 50% of assets in bondlike structures, 35% in stocks, and 15 % in cash. Although this may seem somewhat erroneous in today's investment climate.

These recommendations were quite appropriate if one wished to achieve asset protection, as well as modest or minimal growth.

Currently, the market has taken a turn for the better, and we are seeing asset allocation recommendations drastically change with analysts and professionals recommending 65% of assets be placed in stocks, 25 % in bondlike structures and 10% in cash or cash equivalents.

With respect to your individual portfolio, the following year-end strategies will ensure that your portfolio is well positioned for the New Year:

Realise 'extreme' profits and/or losses:

Some of us have a tendency to hold on to stocks that have depreciated to almost a zero value. Our ego's tell us that there is a slight possibility that the company can turn around and therefore offer us some profits. Yet they remain eyesores in our accounts, reminding us of poorly timed, usually speculative investments.

Sell these losers out of your account. Clean up your portfolio. Come to terms with the fact that it was a poor investment decision and move on.

Shifting attention to equities that have had extreme performance in the other direction, now is a time to consider profit taking.

If individuals have had companies that have grossed large amount in terms of capital appreciation, prudent financial advice suggests that end of year offers a time to realise a certain percentage of these gains.

The idea of crystallising gains with some of your winners is not a bad idea. With extreme profits, individuals' asset allocation ratios (stocks-bonds-cash) tend to be pushed out of proportion.

By scaling back some profits and looking to reinvest in other growth areas, you are able to adhere to the discipline of asset allocation management theory.

Strategically 'gift' yourself (your portfolio) a year-end bonus:

Many employers offer a Christmas or year-end bonus for your commitment and hard work at the firm over the past year.

Take a moment to consider how a percentage of this bonus can be used in the appreciation of your investment portfolio. Even if it's as little of 10% of your year-end bonus, consider this a contribution to you and your family's future.

Review your investment objectives with a Financial Professional:

Your investment needs and objectives should be reviewed yearly, as events in one's life influence our objectives and plans. As well, certain investments may be tailored to specific need, or objectives one has in mind. If over the course of a year, one has met or decided to no longer pursue a previous goal, than his or her portfolio should reflect that. Regardless of the events that occurred during the previous year, individuals who take the time to review their investment performance and overall portfolio make-up will be better suited to profit from what appears to be an exciting and prosperous 2004.