Maturity Gap Calculator

Maturity Gap Calculator calculator can be used to determine the difference between an investor's current asset allocation and their target allocation based on their retirement goals and time horizon.

Input Parameters

Calculation Results

Maturity Gap Analysis

Stocks Gap: 0%
Bonds Gap: 0%
Cash Gap: 0%
Total Gap: 0%

Where:
Stocks Gap = Target Stocks (%) - Current Stocks (%)
Bonds Gap = Target Bonds (%) - Current Bonds (%)
Cash Gap = Target Cash (%) - Current Cash (%)
Total Gap = |Stocks Gap| + |Bonds Gap| + |Cash Gap|

Maturity Gap Calculator Calculator Usage Guide

Learn how to use the Maturity Gap Calculator calculator and its working principles

How to Use the Maturity Gap Calculator

  1. Enter your current asset allocation percentages in the "Input Parameters" section. These should add up to 100%.
  2. Enter your target asset allocation percentages based on your retirement goals and time horizon. These should also add up to 100%.
  3. Click the "Calculate" button to determine the maturity gap between your current and target allocations.
  4. The calculator will display the gap for each asset class (stocks, bonds, cash) as well as the total gap.

Understanding Maturity Gap

The maturity gap represents the difference between your current asset allocation and your target allocation. This gap helps you understand how much you need to adjust your investment strategy to reach your retirement goals.

Practical Applications

  • Identifying investment areas that need adjustment
  • Assessing the need for rebalancing your portfolio
  • Planning for retirement by understanding your current position relative to your goals

Example Scenario

Suppose you are 40 years old and have the following current allocation: 70% stocks, 20% bonds, and 10% cash. Your target allocation for retirement at age 65 is 30% stocks, 50% bonds, and 20% cash. Using the calculator, you would input these values and find that you have significant gaps in stocks and bonds, indicating you need to gradually shift your allocation toward bonds and away from stocks as you approach retirement.