This is the article detailing the investment portfolios of Meb Faber and that of his investment firm Cambria Investments. Here you will find asset allocation as well as performance for the many portfolios Meb Faber has constructed.

Meb Faber Portfolios: Backed By Solid Research

Who is Meb Faber?

Meb Faber (Mebane Faber) is a quant and productivity-meister galore who regularly backtests portfolios. In his fantastic book Global Asset Allocation: A Survey of the World’s Top Asset Allocation Strategies, he has collected a host of different portfolios playing on the same theme – well-diversified portfolios from some of the top money managers.

His paper on tactical asset allocation A Quantitative Approach to Tactical Asset Allocation has revived trend-following and is a fantastic primer on how to implement trend following into your portfolio. Trend following is not designed to deliver market-beating returns but instead to mitigate risk while delivering market like returns.

His book The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets shows how you can mirror the portfolios of the top-endowment funds like Yale and Harvard. You can check out our post Meb Faber’s Ivy 10 Portfolio: Expand And Conquer Yale And Harvard.

We love Meb Faber around here. This is because he is a numbers guy who doesn’t seem to fret about the small stuff in investing. He keeps his horizon long and his feet very close to reality. He is not afraid to call people out on bullshit or dubious claims. He just seems relaxed about investing, surfs (yay!), and really enjoys talking about asset classes, investing and all that jive.

We have gotten a lot of good ideas from Meb Faber’s writings.

Meb Faber is also a fan of trend following which he calls his “desert island” strategy. We here at Portfolioeinstein.com are also fans of trend following as a diversifier and a mitigator of risk. We have an article lined up about just that.

Much of Meb Faber’s work is all about figuring out how others have done well. His books, articles, and podcast reflect this. His book Invest With The House: Hacking The Top Hedge Funds looked at hedge fund strategies and proposed ways to mirror them.

What is special about Meb Faber’s portfolios?

Meb Faber uses two strategies in his portfolios. They are either market timing strategies (trend following) or globally diversified portfolios which span many asset classes. We do not currently track his excellent trend following strategies.

Meb Faber has also a definite bias towards value and momentum asset classes. Both of those have done great historically.

Meb Faber’s Ivy 20, for example, make use of 20 asset classes!

Be sure to visit Meb Faber’s site.

His Ivy league portfolios featured in The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets are examples of his intent on broad diversification while keeping it simple. It is also a fantastic read by the way.

Market Timing Meb

In his paper, A Quantitative Approach to Tactical Asset Allocation. Meb Faber lays forward his tactical asset allocation. It may sound scary but it is easily explained. It means that instead of having a buy-and-hold strategy like almost all of the portfolios on portfolioeinstein.com, the tactical portfolio changes its portfolio. In Meb Faber’s tactical asset allocation portfolio the changes are determined by a 10-month average.

Example: If the price of S&P500 is above its 10-month average you should buy an S&P500 ETF. If it is below the 10-month average you should sell.

Mebane Faber uses more than one asset class in his tactical portfolio however and I suggest you read his paper. It is very easy to understand without the usual academic lingo so it should be accessible for most people.

One thing to remember about trend following is needed to underscore, which Meb Faber also stresses: Trend following is primarily meant to decrease risk not increase returns.

Meb has included market timing in his most recent ETF – the Trinity portfolio ETF (TRTY). Read Meb Faber’s paper on that here.

Performance of Meb Faber’s portfolios

Asset Allocation of Meb Faber’s portfolios

Meb Faber’s Global Asset Allocation Portfolio (GAA)                     

• 18.00%  US Large Cap      (VV)
• 4.50%    REITs     (VNQ)
• 13.50%  International Developed Blend      (VEA)
• 4.50%    Emerging Markets           (VWO)
• 13.50%  Long Term Treasuries        (TLT)
• 19.80%  Corporate Bonds              (LQD)
• 5.00%    Commodities     (DBC / GSG)
• 5.00%    Gold      (IAU)
• 1.80%    TIPS       (VTIP)
• 14.40%  Non-US Bonds   (BNDX)

Meb Faber’s Global Tactical Asset Allocation (GTAA) Conservative                          

• 3.75%    US Large Cap Value         (VTV)
• 3.75%    US Small Cap Value         (VIOV)
• 15.00%  REITs     (VNQ)
• 7.50%    International Developed Blend      (VEA)
• 7.50%    Emerging Markets           (VWO)
• 10.00%  Long Term Treasuries        (TLT)
• 10.00%  Intermediate-Term Treasuries       (VGIT)
• 10.00%  Corporate Bonds              (LQD)
• 15.00%  Commodities     (DBC / GSG)
• 10.00%  Non-US Bonds   (BNDX)
• 7.50%    Momentum Factor          (MTUM)

Meb Faber’s Global Tactical Asset Allocation (GTAA) Moderate                

• 5.00%    US Large Cap Value         (VTV)
• 5.00%    US Small Cap Value         (VIOV)
• 20.00%  REITs     (VNQ)
• 10.00%  International Developed Blend      (VEA)
• 10.00%  Emerging Markets           (VWO)
• 5.00%    Long Term Treasuries        (TLT)
• 5.00%    Intermediate-Term Treasuries       (VGIT)
• 5.00%    Corporate Bonds              (LQD)
• 20.00%  Commodities     (DBC / GSG)
• 5.00%    Non-US Bonds   (BNDX)
• 10.00%  Momentum Factor          (MTUM)

Meb Faber’s Ivy 5 Portfolio                        

• 20.00%  US Total Stock Market   (VTI)
• 20.00%  REITs     (VNQ)
• 20.00%  International Developed Blend      (VEA)
• 20.00%  Total US Bond Market    (BND)
• 20.00%  Commodities     (DBC / GSG)

Meb Faber’s Ivy 10 Portfolio                     

• 10.00%  US Large Cap      (VV)
• 10.00%  US Small Cap      (VIOO)
• 10.00%  REITs     (VNQ)
• 10.00%  International Developed Blend      (VEA)
• 10.00%  Emerging Markets           (VWO)
• 10.00%  Total US Bond Market    (BND)
• 20.00%  Commodities     (DBC / GSG)
• 10.00%  TIPS       (VTIP)
• 10.00%  International REITs          (VNQI)

Meb Faber Ivy 20 portfolio                        

• 5.00%    US Large Cap      (VV)
• 5.00%    US Mid Cap         (IJH)
• 5.00%    US Small Cap      (VIOO)
• 5.00%    US Micro Cap     (IWC)
• 5.00%    REITs (Real Estate)           (VNQ)
• 5.00%    Int. Developed Blend      (VEA)
• 5.00%    Emerging Markets           (VWO)
• 5.00%    Intl Sm Cap Blend             (VSS)
• 5.00%    Total US Bond Market    (BND)
• 5.00%    Timber (TREE)
• 5.00%    Infrastructure
• 5.00%  Commodities     (DBC / GSG)
• 5.00%  Commodities     (DBC / GSG)
• 5.00%  Commodities     (DBC / GSG)
• 5.00%  Commodities     (DBC / GSG)
• 5.00%    TIPS       (VTIP)
• 5.00%    Non-US Bonds   (BNDX)
• 5.00%    Emerging Markets Small Cap       (EWX)
• 5.00%    Emerging Market Bonds (VWOB)
• 5.00%    International REITs (Real Estate) (VNQI)

Meb Faber’s Risk Parity Portfolio                            

• 7.50%    US Total Stock Market   (VTI)
• 5.00%    REITs     (VNQ)
• 7.50%    International All-World ex-US     (VEU)
• 35.00%  Intermediate-Term Treasuries       (VGIT)
• 35.00%  Corporate Bonds              (LQD)
• 5.00%    Commodities     (DBC / GSG)
• 5.00%    Gold      (IAU)

Meb Faber portfolio resources

Be sure to visit Meb Faber website where he often posts.

His podcast is often of very good quality. The first 3 is like a mini-course on investing!

Meb Faber has written some very good books. One of their chief qualities is they are without any fluff or padding you normally see in these books.

Meb Faber is the CEO and CIO of Cambria Investments.

Conclusion

Which portfolio do you use?

After having read up on Meb Faber’s portfolios I encourage you to find other great portfolios right here on portfolioeinstein.com.

If you have suggestions to new portfolios be sure to add them in comments or reach out to me.

I would love to hear from you!

This article displays all of the Morningstar portfolios. They display a pure mastery of asset allocation and it shows in their high returns. There are a lot of portfolios! Here you will find asset allocation as well as performance for the many portfolios Morningstar has created.

The article covers the Lifetime Allocation Indexes (target date funds) and it covers the Morningstar savings portfolios.

Morningstar Portfolios: A Laser Beam On Your Returns

What is Morningstar?

Morningstar is an investment research company offering mutual fund, ETF, and stock analysis, ratings, and data, and portfolio tools.

Morningstar offers a fantastic set of tools to examine a fund or ETF called the X-ray. It shows many metrics about a fund or ETF. For example, it shows which stocks are in the ETF. It also shows the value or growth tilt of a fund or ETF.

I use it almost every day!

I did a mini-tutorial on this tool. To see it in action read the article What Is The Best ETF And Mutual Fund?

What is special about Morningstar portfolios?

There are 2 sets of portfolios in this article:

• The Lifetime Allocation Indexes (target date funds)
• The Morningstar savings portfolios.

The Lifetime Allocation Indexes (target date funds)

The Morningstar®Lifetime Allocation Indexes are Morningstar target-date retirement portfolios. There are A LOT of them as Morningstar has an aggressive, moderate and conservative fund for each target-date. This means for example that for their 2030 target date they have 3 portfolios (aggressive, moderate and conservative). For their 2040 target date fund, they have 3 portfolio allocation (aggressive, moderate and conservative).

No one other target date fund provider offers this and it does seem overly complex and confusing. I think it negates much of the simplicity normally associated with target-date retirement funds. In addition, the portfolios have a lot of asset classes. In fact, they have the most number of asset classes of all the target date portfolios on portfolioeinstein.com. The Goldman Sachs target date portfolios come close. The Morningstar Lifetime Allocation Indexes even have exposure to commodities.

However, with that said – they do very well as can be seen in our comparison of target date funds here: What Is The Best Target Date Fund?

The Morningstar savings portfolios

These portfolios have been constructed by Christine Benz who is a  director of personal finance at Morningstar. She has put together the portfolios to help you save for retirement. In addition, she has also built portfolios for a 3-bucket approach when you already are in retirement. Those portfolios are not suited here but you can find them here. Christine Benz is the author of two wonderful books that come highly recommended. The first is Morningstar 30-Minute Money Solutions: A Step-by-Step Guide to Managing Your Finances and the second is Morningstar Guide to Mutual Funds: Five-Star Strategies for Success.

Get it on Amazon

Performance of the Morningstar portfolios

Asset Allocation of the Morningstar portfolios

Morningstar Aggressive Retirement Saver Portfolio                       

• 50.00%  US Total Stock Market   (VTI)
• 10.00%  US Small Cap Value         (VIOV)
• 30.00%  International Developed Blend      (VEA)
• 5.00%    Emerging Markets           (VWO)
• 5.00%    Total US Bond Market    (BND)

Morningstar Moderate Retirement Saver Portfolio                        

• 47.00%  US Total Stock Market   (VTI)
• 8.00%    US Small Cap Value         (VIOV)
• 20.00%  International Developed Blend      (VEA)
• 5.00%    Emerging Markets           (VWO)
• 20.00%  Total US Bond Market    (BND)

Morningstar Conservative Retirement Saver Portfolio                  

• 33.00%  US Total Stock Market   (VTI)
• 5.00%    US Small Cap Value         (VIOV)
• 10.00%  International Developed Blend      (VEA)
• 4.00%    Emerging Markets           (VWO)
• 30.00%  Total US Bond Market    (BND)
• 7.00%    Short-Term Investment Grade   (VCSH)
• 11.00%  TIPS       (VTIP)

Morningstar Lifetime Allocation Index Aggressive, 2030                               

• 11.52%  US Large Cap Value         (VTV)
• 10.00%  US Large Cap      (VV)
• 8.79%    US Large Cap Growth     (VUG)
• 4.94%    US Mid Cap Value            (JKI)
• 4.29%    US Mid Cap         (IJH)
• 3.77%    US Mid Cap Growth        (IJK)
• 3.10%    US Small Cap Value         (VIOV)
• 2.69%    US Small Cap      (VIOO)
• 2.37%    US Small Cap Growth     (IJT)
• 2.68%    REITs     (VNQ)
• 21.27%  International Developed Blend      (VEA)
• 7.24%    Emerging Markets           (VWO)
• 10.03%  Total US Bond Market    (BND)
• 0.45%    Cash (money market fund)          (BIL)
• 2.45%    Commodities     (DBC / GSG)
• 2.12%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Aggressive, 2040                               

• 12.13%  US Large Cap Value         (VTV)
• 10.54%  US Large Cap      (VV)
• 9.26%    US Large Cap Growth     (VUG)
• 5.20%    US Mid Cap Value            (JKI)
• 4.52%    US Mid Cap         (IJH)
• 3.97%    US Mid Cap Growth        (IJK)
• 3.81%    US Small Cap Value         (VIOV)
• 3.31%    US Small Cap      (VIOO)
• 2.91%    US Small Cap Growth     (IJT)
• 2.93%    REITs     (VNQ)
• 25.26%  International Developed Blend      (VEA)
• 9.54%    Emerging Markets           (VWO)
• 3.00%    Total US Bond Market    (BND)
• 0.05%    Cash (money market fund)          (BIL)
• 2.62%    Commodities     (DBC / GSG)
• 0.25%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Aggressive, 2050                               

• 11.34%  US Large Cap Value         (VTV)
• 9.85%    US Large Cap      (VV)
• 8.66%    US Large Cap Growth     (VUG)
• 4.86%    US Mid Cap Value            (JKI)
• 4.22%    US Mid Cap         (IJH)
• 3.71%    US Mid Cap Growth        (IJK)
• 4.10%    US Small Cap Value         (VIOV)
• 3.56%    US Small Cap      (VIOO)
• 3.13%    US Small Cap Growth     (IJT)
• 3.18%    REITs     (VNQ)
• 26.55%  International Developed Blend      (VEA)
• 11.06%  Emerging Markets           (VWO)
• 2.40%    Total US Bond Market    (BND)
• 2.78%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Aggressive, 2060                               

• 10.45%  US Large Cap Value         (VTV)
• 9.08%    US Large Cap      (VV)
• 7.98%    US Large Cap Growth     (VUG)
• 4.48%    US Mid Cap Value            (JKI)
• 3.89%    US Mid Cap         (IJH)
• 3.42%    US Mid Cap Growth        (IJK)
• 4.30%    US Small Cap Value         (VIOV)
• 3.73%    US Small Cap      (VIOO)
• 3.28%    US Small Cap Growth     (IJT)
• 3.43%    REITs     (VNQ)
• 27.45%  International Developed Blend      (VEA)
• 12.56%  Emerging Markets           (VWO)
• 2.35%    Total US Bond Market    (BND)
• 2.95%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Aggressive, Income                         

• 7.45%    US Large Cap Value         (VTV)
• 6.47%    US Large Cap      (VV)
• 5.68%    US Large Cap Growth     (VUG)
• 3.19%    US Mid Cap Value            (JKI)
• 2.77%    US Mid Cap         (IJH)
• 2.44%    US Mid Cap Growth        (IJK)
• 1.18%    US Small Cap Value         (VIOV)
• 1.03%    US Small Cap      (VIOO)
• 0.90%    US Small Cap Growth     (IJT)
• 2.00%    REITs     (VNQ)
• 9.68%    International Developed Blend      (VEA)
• 2.42%    Emerging Markets           (VWO)
• 23.27%  Total US Bond Market    (BND)
• 4.28%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 19.96%  TIPS       (VTIP)

Morningstar Lifetime Allocation Index Conservative, 2030                          

• 6.13%    US Large Cap Value         (VTV)
• 5.32%    US Large Cap      (VV)
• 4.68%    US Large Cap Growth     (VUG)
• 2.63%    US Mid Cap Value            (JKI)
• 2.28%    US Mid Cap         (IJH)
• 2.00%    US Mid Cap Growth        (IJK)
• 1.65%    US Small Cap Value         (VIOV)
• 1.43%    US Small Cap      (VIOO)
• 1.26%    US Small Cap Growth     (IJT)
• 2.18%    REITs     (VNQ)
• 10.87%  International Developed Blend      (VEA)
• 3.70%    Emerging Markets           (VWO)
• 36.52%  Total US Bond Market    (BND)
• 1.64%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 7.71%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Conservative, 2040                          

• 8.66%    US Large Cap Value         (VTV)
• 7.52%    US Large Cap      (VV)
• 6.61%    US Large Cap Growth     (VUG)
• 3.71%    US Mid Cap Value            (JKI)
• 3.22%    US Mid Cap         (IJH)
• 2.83%    US Mid Cap Growth        (IJK)
• 2.72%    US Small Cap Value         (VIOV)
• 2.36%    US Small Cap      (VIOO)
• 2.07%    US Small Cap Growth     (IJT)
• 2.43%    REITs     (VNQ)
• 17.11%  International Developed Blend      (VEA)
• 6.46%    Emerging Markets           (VWO)
• 24.39%  Total US Bond Market    (BND)
• 0.41%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 2.00%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Conservative, 2050                          

• 9.89%    US Large Cap Value         (VTV)
• 8.59%    US Large Cap      (VV)
• 7.55%    US Large Cap Growth     (VUG)
• 4.24%    US Mid Cap Value            (JKI)
• 3.68%    US Mid Cap         (IJH)
• 3.24%    US Mid Cap Growth        (IJK)
• 3.57%    US Small Cap Value         (VIOV)
• 3.10%    US Small Cap      (VIOO)
• 2.73%    US Small Cap Growth     (IJT)
• 2.68%    REITs     (VNQ)
• 21.71%  International Developed Blend      (VEA)
• 9.04%    Emerging Markets           (VWO)
• 14.53%  Total US Bond Market    (BND)
• 0.00%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Conservative, 2060                          

• 9.54%    US Large Cap Value         (VTV)
• 8.28%    US Large Cap      (VV)
• 7.28%    US Large Cap Growth     (VUG)
• 4.09%    US Mid Cap Value            (JKI)
• 3.55%    US Mid Cap         (IJH)
• 3.12%    US Mid Cap Growth        (IJK)
• 3.92%    US Small Cap Value         (VIOV)
• 3.41%    US Small Cap      (VIOO)
• 2.99%    US Small Cap Growth     (IJT)
• 2.93%    REITs     (VNQ)
• 23.17%  International Developed Blend      (VEA)
• 10.61%  Emerging Markets           (VWO)
• 11.89%  Total US Bond Market    (BND)
• 2.00%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Conservative, Income                    

• 3.29%    US Large Cap Value         (VTV)
• 2.86%    US Large Cap      (VV)
• 2.51%    US Large Cap Growth     (VUG)
• 1.41%    US Mid Cap Value            (JKI)
• 1.23%    US Mid Cap         (IJH)
• 1.08%    US Mid Cap Growth        (IJK)
• 0.52%    US Small Cap Value         (VIOV)
• 0.45%    US Small Cap      (VIOO)
• 0.40%    US Small Cap Growth     (IJT)
• 1.50%    REITs     (VNQ)
• 4.28%    International Developed Blend      (VEA)
• 1.07%    Emerging Markets           (VWO)
• 34.50%  Total US Bond Market    (BND)
• 6.35%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 29.58%  TIPS       (VTIP)

Morningstar Lifetime Allocation Index Moderate, 2030                 

• 9.10%    US Large Cap Value         (VTV)
• 7.90%    US Large Cap      (VV)
• 6.94%    US Large Cap Growth     (VUG)
• 3.90%    US Mid Cap Value            (JKI)
• 3.39%    US Mid Cap         (IJH)
• 2.97%    US Mid Cap Growth        (IJK)
• 2.45%    US Small Cap Value         (VIOV)
• 2.13%    US Small Cap      (VIOO)
• 1.87%    US Small Cap Growth     (IJT)
• 2.68%    REITs     (VNQ)
• 16.47%  International Developed Blend      (VEA)
• 5.61%    Emerging Markets           (VWO)
• 22.03%  Total US Bond Market    (BND)
• 0.98%    Cash (money market fund)          (BIL)
• 2.45%    Commodities     (DBC / GSG)
• 4.65%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Moderate, 2040                 

• 11.03%  US Large Cap Value         (VTV)
• 9.58%    US Large Cap      (VV)
• 8.42%    US Large Cap Growth     (VUG)
• 4.73%    US Mid Cap Value            (JKI)
• 4.10%    US Mid Cap         (IJH)
• 3.61%    US Mid Cap Growth        (IJK)
• 3.46%    US Small Cap Value         (VIOV)
• 3.01%    US Small Cap      (VIOO)
• 2.64%    US Small Cap Growth     (IJT)
• 2.93%    REITs     (VNQ)
• 22.38%  International Developed Blend      (VEA)
• 8.45%    Emerging Markets           (VWO)
• 10.00%  Total US Bond Market    (BND)
• 0.16%    Cash (money market fund)          (BIL)
• 2.62%    Commodities     (DBC / GSG)
• 0.82%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Moderate, 2050                 

• 10.92%  US Large Cap Value         (VTV)
• 9.49%    US Large Cap      (VV)
• 8.34%    US Large Cap Growth     (VUG)
• 4.68%    US Mid Cap Value            (JKI)
• 4.07%    US Mid Cap         (IJH)
• 3.57%    US Mid Cap Growth        (IJK)
• 3.95%    US Small Cap Value         (VIOV)
• 3.43%    US Small Cap      (VIOO)
• 3.01%    US Small Cap Growth     (IJT)
• 3.18%    REITs     (VNQ)
• 24.76%  International Developed Blend      (VEA)
• 10.31%  Emerging Markets           (VWO)
• 6.18%    Total US Bond Market    (BND)
• 0.00%    Cash (money market fund)          (BIL)
• 2.78%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Moderate, 2060                 

• 10.16%  US Large Cap Value         (VTV)
• 8.83%    US Large Cap      (VV)
• 7.76%    US Large Cap Growth     (VUG)
• 4.36%    US Mid Cap Value            (JKI)
• 3.78%    US Mid Cap         (IJH)
• 3.32%    US Mid Cap Growth        (IJK)
• 4.18%    US Small Cap Value         (VIOV)
• 3.63%    US Small Cap      (VIOO)
• 3.19%    US Small Cap Growth     (IJT)
• 3.43%    REITs     (VNQ)
• 25.67%  International Developed Blend      (VEA)
• 11.75%  Emerging Markets           (VWO)
• 5.62%    Total US Bond Market    (BND)
• 0.00%    Cash (money market fund)          (BIL)
• 2.95%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Moderate, Income                           

• 5.44%    US Large Cap Value         (VTV)
• 4.72%    US Large Cap      (VV)
• 4.15%    US Large Cap Growth     (VUG)
• 2.33%    US Mid Cap Value            (JKI)
• 2.02%    US Mid Cap         (IJH)
• 1.78%    US Mid Cap Growth        (IJK)
• 0.86%    US Small Cap Value         (VIOV)
• 0.75%    US Small Cap      (VIOO)
• 0.66%    US Small Cap Growth     (IJT)
• 2.00%    REITs     (VNQ)
• 7.07%    International Developed Blend      (VEA)
• 1.77%    Emerging Markets           (VWO)
• 28.74%  Total US Bond Market    (BND)
• 5.28%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 24.63%  TIPS       (VTIP)

Find the best ETFs and mutual funds in our updated article What Is The Best ETF And Mutual Fund?

Morningstar resources

The Morningstar website

The https://www.morningstar.com/articles/archive/467/us-videos.htmlMorninstar video archive – great for keeping up with investment news!

Morningstar also has a youtube channel.

Morningstar has a podcast, and you can find it on all podcast outlets

Now its your turn!

Which portfolio do you use?

After having read up on the Morningstar portfolios what do you think are good about them?

I encourage you to find other great portfolios right here on portfolioeinstein.com.

If you have suggestions to new portfolios be sure to add them in comments or reach out to me.

I would love to hear from you!

This article displays the Larry Swedroe portfolios. They are low volatility and high returning portfolios. In other words: They are awesome.

Larry Swedroe Portfolio: Nemesis of Low Returns

Who is Larry Swedroe?

Larry Swedroe is a prolific author and director of research at wealth management firm Buckingham Strategic Wealth. He often visits the Bogleheads Forum where he shares insights, knowledge and answers questions. He is easily one of our favorite authors on investing. He is also a clear runner up for one of the good guys in investing.

He has written many articles all over the web as well. Examples include articles on ETF.com, Forbes, finance.yahoo.com and of course on the Bam Alliance website. The BAM alliance is a “community of independent advisors” that put the client first, i.e. they hold their fiduciary responsibility to a very high standard.

Larry Swedroe favors a data-driven approach to investing. This means that in all his books he has plenty of evidence why he suggests a certain portfolio. In that regard, he is very much like Paul Merriman who is also an evidence-based investor.

Larry Swedroe is a prolific writer. The really good books include The Only Guide to a Winning Investment Strategy You’ll Ever Need (co-written),  and Your Complete Guide to Factor-Based Investing: The Way Smart Money Invests Today. You may not think that you need to do any factor-based investing (smart beta) but the first 30 pages in this book are like a 500$ course on investing! It teaches you everything about what asset classes are and how to think about them. It teaches you what “the market” really is. And it teaches you that not all asset classes are really asset classes!

Awesome introduction to asset classes, “the market” and why small-caps have outperformed.

What is special about the Larry Swedroe portfolios?

Larry Swedroe has designed some very interesting portfolios that look like no-one else’s. The one theme that runs through all of his portfolios is to keep the portfolios low on volatility. Larry Swedroe favors safety over high-risk returns. This doesn’t mean that Larry Swedroe’s portfolios are lackluster portfolios! On the contrary.

Larry Swedrowe’s portfolios are designed in such a way that their first component is to be heavy (or very heavy) on low volatility asset classes like bonds. The second component of Larry Swedroe’s portfolios is to add high performing, high-risk asset classes like small caps to make the portfolio offer great returns.

The results of this portfolio jiu-jitsu are portfolios that have very low volatility and high returns in comparison to other portfolios with the same amount of bond allocation.

This makes the portfolios suited for normal savings situations or for clients that simply cannot stomach the high volatility of a 100% stock portfolio.

If you want to get inside of Larry Swedroe’s head to see how he thinks I recommend his book The Only Guide to a Winning Investment Strategy You’ll Ever Need.

The results of this portfolio jiu-jitsu are portfolios that have very low volatility and high returns

Performance of the Larry Swedroe portfolios

Asset Allocation of the Larry Swedroe portfolios

Larry Swedroe Simple Portfolio               

• 15.00%  US Large Cap Value         (VTV)
• 15.00%  US Small Cap Value         (VIOV)
• 13.00%  US Small Cap      (VIOO)
• 4.00%    Emerging Markets           (VWO)
• 13.00%  International Large Cap Value     (EFV)
• 40.00%  TIPS       (VTIP)

Larry Swedroe, “The Larry” Portfolio 1                  

• 5.00%    US Large Cap Value         (VTV)
• 5.00%    US Large Cap      (VV)
• 5.00%    US Small Cap Value         (VIOV)
• 5.00%    US Small Cap      (VIOO)
• 10.00%  International Large Cap Value     (EFV)
• 10.00%  International Small Cap Blend             (VSS)
• 60.00%  Intermediate-Term Treasuries       (VGIT)

Larry Swedroe, “The Larry” Portfolio 2                  

• 12.50%  US Small Cap Value         (VIOV)
• 75.00%  Intermediate-Term Treasuries       (VGIT)
• 12.50%  International Small Cap Value             (DLS)

Larry Swedroe, Eliminate Fat Tails Portfolio                  

• 15.00%  US Small Cap      (VIOO)
• 15.00%  Emerging Markets           (VWO)
• 35.00%  Cash (money market fund)          (BIL)
• 35.00%  TIPS       (VTIP)

Larry Swedroe’s Big Rocks Portfolio                       

• 9.00%    US Large Cap Value         (VTV)
• 9.00%    US Large Cap      (VV)
• 9.00%    US Small Cap Value         (VIOV)
• 9.00%    US Small Cap      (VIOO)
• 6.00%    REITs     (VNQ)
• 3.00%    Emerging Markets           (VWO)
• 3.00%    International All-World ex-US     (VEU)
• 6.00%    International Large Cap Value     (EFV)
• 3.00%    International Small Cap Blend             (VSS)
• 40.00%  Short Term Treasuries       (VGSH)
• 3.00%    International Small Cap Value             (DLS)

Find the best ETFs and mutual funds in our updated article What Is The Best ETF And Mutual Fund?

Larry Swedroe resources

Larry Swedroe is a prolific writer – here is an overview of all of his books an Amazon.

You can find his articles on ETF.com where he is a frequent contributor.

Larry Swedroe is the director of research at Buckingham Wealth Advisors.

Larry Swedroe is also found on the Bogleheads forum where he helps out answering questions and cutting through the F.U.D.

Let’s continue the conversation!

Which portfolio do you use?

After having read up on Larry Swedroe’s portfolios I encourage you to find other great portfolios right here on portfolioeinstein.com.

If you have suggestions to new portfolios be sure to add them in comments or reach out to me.

I would love to hear from you!

This is the article detailing the William Bernstein portfolios. William Bernstein is one of the 3 good guys in investing. He is truly one of the giants in investing. In this article, you will find 32 of his portfolios along with asset allocation and performance.

William Bernstein Portfolios: The Portfolio Giant

Who is William Bernstein?

William Bernstein, a former doctor, investment consultant and an all around good guy in the investing world has presented a host of portfolios through his career. His book, The Four Pillars of Investing: Lessons for Building a Winning Portfolio is required reading on investing. His investing philosophy is broad diversification, common sense and with a realistic expectation of future returns. Other books that come highly recommended are Rational Expectations: Asset Allocation for Investing Adults and The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk.

William Bernstein is one of the first names you encounter when entering the investing world, especially personal investing world. But his investing principles are applicable to institutional investing as well.

His book William Bernstein: The Four Pillars of Investing: Lessons for Building a Winning Portfolio is one of the best books on investing you can read. It is on our very short list of the very best investing book ever written.

William Bernstein is also one of the very few good guys in investing. He has gone above and beyond in helping the everyday investor to get better returns through a solid investing framework.

Get this on Amazon – The audiobook is especially recommended as the narrator is phenomenal.

What is special about the William Bernstein portfolios?

The one thing that William Bernstein focus on in his portfolios is diversification through many asset classes. He is a self-proclaimed asset class junkie. 

Therefore his portfolios display very broad diversification.

In addition to this William Bernstein is a 360-degree investor so he takes into account a lot of factors. For example:

• Asset location (to minimize taxes)
• Specific asset class to minimize taxes like muni bonds
• Your age
• Your appetite for risk
• Your employer’s fund offerings if you are investing through a 401K.

All this makes Bernstein shine as a very helpful guide in all of your investment endeavors.

Finally, he is adamant about facing reality and being very aware of what you can actually expect in returns of your portfolios.

William Bernstein’s most famous portfolios are the lazy portfolios. The two are the No-brainer portfolio and the Cowards’ portfolio. You can read more about those specific portfolios in our posts on lazy portfolios Lazy Portfolios and 5 Reasons Why A Lazy Portfolio Is Right For You.

If you are interested in learning way more about William Bernstein and his investing philosophy pick up one or two of his books. Apart from his book Four Pillars I very much recommend the following two:

Get it on Amazon – The audiobook has GREAT narration.

Performance of the William Bernstein portfolios

Asset Allocation of the William Bernstein portfolios

William Bernstein Cowards Portfolio                 

• 10.00%  US Large Cap Value         (VTV)
• 15.00%  US Large Cap      (VV)
• 10.00%  US Small Cap Value         (VIOV)
• 5.00%    US Small Cap      (VIOO)
• 5.00%    REITs     (VNQ)
• 5.00%    Emerging Markets           (VWO)
• 5.00%    Pacific Stocks     (VPL)
• 5.00%    European Stocks               (VGK)
• 40.00%  Short Term Treasuries       (VGSH)

William Bernstein Four Pillars High-Risk Portfolio                         

• 10.00%  US Large Cap Value         (VTV)
• 10.00%  US Large Cap      (VV)
• 7.50%    US Small Cap Value         (VIOV)
• 5.00%    US Small Cap      (VIOO)
• 7.50%    REITs     (VNQ)
• 7.50%    Emerging Markets           (VWO)
• 7.50%    Pacific Stocks     (VPL)
• 10.00%  European Stocks               (VGK)
• 7.50%    International Large Cap Value     (EFV)
• 25.00%  Short Term Treasuries       (VGSH)
• 2.50%    Precious Metals (GLTR)

Highlighted in the above pie chart

William Bernstein Four Pillars Low-Risk Portfolio                          

• 35.00%  US Total Stock Market   (VTI)
• 5.00%    REITs     (VNQ)
• 10.00%  International All-World ex-US     (VEU)
• 50.00%  Short Term Treasuries       (VGSH)

William Bernstein Four Pillars Medium Portfolio                          

• 25.00%  US Total Stock Market   (VTI)
• 10.00%  US Large Cap Value         (VTV)
• 10.00%  US Small Cap Value         (VIOV)
• 5.00%    REITs     (VNQ)
• 10.00%  International All-World ex-US     (VEU)
• 40.00%  Short Term Treasuries       (VGSH)

William Bernstein No Brainer Portfolio                             

• 25.00%  US Large Cap      (VV)
• 25.00%  US Small Cap      (VIOO)
• 25.00%  International All-World ex-US     (VEU)
• 25.00%  Short Term Treasuries       (VGSH)

The No-Brainer portfolio is part of the group of Lazy Portfolios.

William Bernstein Sheltered Sam Portfolio                      

• 15.00%  US Large Cap Value         (VTV)
• 12.00%  US Large Cap      (VV)
• 9.00%    US Small Cap Value         (VIOV)
• 3.00%    US Small Cap      (VIOO)
• 6.00%    REITs     (VNQ)
• 3.00%    Emerging Markets           (VWO)
• 3.00%    Pacific Stocks     (VPL)
• 3.00%    European Stocks               (VGK)
• 4.20%    International Large Cap Value     (EFV)
• 24.00%  Short Term Treasuries       (VGSH)
• 1.80%    Precious Metals (GLTR)
• 16.00%  TIPS       (VTIP)

William Bernstein Sheltered Sam 100% Stocks                  

• 25.00%  US Large Cap Value         (VTV)
• 20.00%  US Large Cap      (VV)
• 15.00%  US Small Cap Value         (VIOV)
• 5.00%    US Small Cap      (VIOO)
• 10.00%  REITs (Real Estate)           (VNQ)
• 5.00%    Emerging Markets           (VWO)
• 5.00%    Pacific Stocks     (VPL)
• 5.00%    European Stocks               (VGK)
• 7.00%    International Lg Cap Value           (EFV)
• 3.00%    Precious Metals (GLTR)

William Bernstein Sheltered Sam 90/10                

• 22.50%  US Large Cap Value         (VTV)
• 18.00%  US Large Cap      (VV)
• 13.50%  US Small Cap Value         (VIOV)
• 4.50%    US Small Cap      (VIOO)
• 9.00%    REITs (Real Estate)           (VNQ)
• 4.50%    Emerging Markets           (VWO)
• 4.50%    Pacific Stocks     (VPL)
• 4.50%    European Stocks               (VGK)
• 6.30%    International Lg Cap Value           (EFV)
• 2.70%    Precious Metals (GLTR)
• 6.00%    Short-Term Investment Grade   (VCSH)
• 4.00%    TIPS       (VTIP)

William Bernstein Sheltered Sam 80/20

• 20.00%  US Large Cap Value         (VTV)
• 16.00%  US Large Cap      (VV)
• 12.00%  US Small Cap Value         (VIOV)
• 4.00%    US Small Cap      (VIOO)
• 8.00%    REITs (Real Estate)           (VNQ)
• 4.00%    Emerging Markets           (VWO)
• 4.00%    Pacific Stocks     (VPL)
• 4.00%    European Stocks               (VGK)
• 5.60%    International Lg Cap Value           (EFV)
• 2.40%    Precious Metals (GLTR)
• 12.00%  Short-Term Investment Grade   (VCSH)
• 8.00%    TIPS       (VTIP)

William Bernstein Sheltered Sam 70/30                

• 17.50%  US Large Cap Value         (VTV)
• 14.00%  US Large Cap      (VV)
• 10.50%  US Small Cap Value         (VIOV)
• 3.50%    US Small Cap      (VIOO)
• 7.00%    REITs (Real Estate)           (VNQ)
• 3.50%    Emerging Markets           (VWO)
• 3.50%    Pacific Stocks     (VPL)
• 3.50%    European Stocks               (VGK)
• 4.90%    International Lg Cap Value           (EFV)
• 2.10%    Precious Metals (GLTR)
• 18.00%  Short-Term Investment Grade   (VCSH)
• 12.00%  TIPS       (VTIP)

William Bernstein Sheltered Sam 60/40                

• 15.00%  US Large Cap Value         (VTV)
• 12.00%  US Large Cap      (VV)
• 9.00%    US Small Cap Value         (VIOV)
• 3.00%    US Small Cap      (VIOO)
• 6.00%    REITs (Real Estate)           (VNQ)
• 3.00%    Emerging Markets           (VWO)
• 3.00%    Pacific Stocks     (VPL)
• 3.00%    European Stocks               (VGK)
• 4.20%    International Lg Cap Value           (EFV)
• 1.80%    Precious Metals (GLTR)
• 24.00%  Short-Term Investment Grade   (VCSH)
• 16.00%  TIPS       (VTIP)

William Bernstein Sheltered Sam 50/50                

• 12.50%  US Large Cap Value         (VTV)
• 10.00%  US Large Cap      (VV)
• 7.50%    US Small Cap Value         (VIOV)
• 2.50%    US Small Cap      (VIOO)
• 5.00%    REITs (Real Estate)           (VNQ)
• 2.50%    Emerging Markets           (VWO)
• 2.50%    Pacific Stocks     (VPL)
• 2.50%    European Stocks               (VGK)
• 3.50%    International Lg Cap Value           (EFV)
• 1.50%    Precious Metals (GLTR)
• 30.00%  Short-Term Investment Grade   (VCSH)
• 20.00%  TIPS       (VTIP)

William Bernstein Sheltered Sam 40/60                

• 10.00%  US Large Cap Value         (VTV)
• 8.00%    US Large Cap      (VV)
• 6.00%    US Small Cap Value         (VIOV)
• 2.00%    US Small Cap      (VIOO)
• 4.00%    REITs (Real Estate)           (VNQ)
• 2.00%    Emerging Markets           (VWO)
• 2.00%    Pacific Stocks     (VPL)
• 2.00%    European Stocks               (VGK)
• 2.80%    International Lg Cap Value           (EFV)
• 1.20%    Precious Metals (GLTR)
• 36.00%  Short-Term Investment Grade   (VCSH)
• 24.00%  TIPS       (VTIP)

William Bernstein Sheltered Sam 30/70                

• 7.50%    US Large Cap Value         (VTV)
• 6.00%    US Large Cap      (VV)
• 4.50%    US Small Cap Value         (VIOV)
• 1.50%    US Small Cap      (VIOO)
• 3.00%    REITs (Real Estate)           (VNQ)
• 1.50%    Emerging Markets           (VWO)
• 1.50%    Pacific Stocks     (VPL)
• 1.50%    European Stocks               (VGK)
• 2.10%    International Lg Cap Value           (EFV)
• 0.90%    Precious Metals (GLTR)
• 42.00%  Short-Term Investment Grade   (VCSH)
• 28.00%  TIPS       (VTIP)

William Bernstein Sheltered Sam 20/80                

• 5.00%    US Large Cap Value         (VTV)
• 4.00%    US Large Cap      (VV)
• 3.00%    US Small Cap Value         (VIOV)
• 1.00%    US Small Cap      (VIOO)
• 2.00%    REITs (Real Estate)           (VNQ)
• 1.00%    Emerging Markets           (VWO)
• 1.00%    Pacific Stocks     (VPL)
• 1.00%    European Stocks               (VGK)
• 1.40%    International Lg Cap Value           (EFV)
• 0.60%    Precious Metals (GLTR)
• 48.00%  Short-Term Investment Grade   (VCSH)
• 32.00%  TIPS       (VTIP)

William Bernstein Sheltered Sam 10/90                

• 2.50%    US Large Cap Value         (VTV)
• 2.00%    US Large Cap      (VV)
• 1.50%    US Small Cap Value         (VIOV)
• 0.50%    US Small Cap      (VIOO)
• 1.00%    REITs (Real Estate)           (VNQ)
• 0.50%    Emerging Markets           (VWO)
• 0.50%    Pacific Stocks     (VPL)
• 0.50%    European Stocks               (VGK)
• 0.70%    International Lg Cap Value           (EFV)
• 0.30%    Precious Metals (GLTR)
• 54.00%  Short-Term Investment Grade   (VCSH)
• 36.00%  TIPS       (VTIP)

William Bernstein Sheltered Sam 100% Bonds                  

• 60.00%  Short-Term Investment Grade   (VCSH)
• 40.00%  TIPS       (VTIP)

William Bernstein Young Yvonne Portfolio                         

• 15.00%  US Large Cap Value         (VTV)
• 12.00%  US Large Cap      (VV)
• 9.00%    US Small Cap Value         (VIOV)
• 3.00%    US Small Cap      (VIOO)
• 6.00%    REITs (Real Estate)           (VNQ)
• 3.00%    Emerging Markets           (VWO)
• 3.00%    Pacific Stocks     (VPL)
• 3.00%    European Stocks               (VGK)
• 4.20%    International Lg Cap Value           (EFV)
• 40.00%  Total US Bond Market    (BND)
• 1.80%    Precious Metals (GLTR)

William Bernstein Charlie Cringe Portfolio                          

• 35.00%  US Total Stock Market   (VTI)
• 5.00%    REITs (Real Estate)           (VNQ)
• 10.00%  Int. Developed Blend      (VEA)
• 50.00%  Short Term Treasury       (VGSH)

William Bernstein Wendy Wonk Portfolio                          

• 10.00%  US Large Cap Value         (VTV)
• 10.00%  US Large Cap      (VV)
• 7.50%    US Small Cap Value         (VIOV)
• 5.00%    US Small Cap      (VIOO)
• 7.50%    REITs (Real Estate)           (VNQ)
• 7.50%    Emerging Markets           (VWO)
• 7.50%    Pacific Stocks     (VPL)
• 10.00%  European Stocks               (VGK)
• 7.50%    International Lg Cap Value           (EFV)
• 25.00%  Short Term Treasury       (VGSH)
• 2.50%    Precious Metals (GLTR)

William Bernstein Between Charlie and Wendy Portfolio                            

• 25.00%  US Total Stock Market   (VTI)
• 10.00%  US Large Cap Value         (VTV)
• 10.00%  US Small Cap Value         (VIOV)
• 5.00%    REITs (Real Estate)           (VNQ)
• 10.00%  Int. Developed Blend      (VEA)
• 40.00%  Short Term Treasury       (VGSH)

Find the best ETFs and mutual funds in our updated article What Is The Best ETF And Mutual Fund?

Resources for William Bernstein

His website The Efficient Frontier details he many books and a few other resources

His many books on Amazon. He has written on other topics other than investing. His book A Splendid Exchange is a fantastic inquiry on how trade enabled the modern world.

He has appeared on many financial and investing podcasts, use this search to find them all.

He is one of only three good guys in investing.

Conclusion

Which portfolio do you use?

After having read up on the William Bernstein portfolios I encourage you to find other great portfolios right here on portfolioeinstein.com.

If you have suggestions to new portfolios be sure to add them in comments or reach out to me.

I would love hearing from you!

This is the article detailing the investment portfolios of Allan Roth and his Second Grader Portfolios. Here you will find asset allocation and performance for the portfolios.

Allan Roth is the founder of  Wealthlogic and author of How a Second Grader Beats Wall Street: Golden Rules Any Investor Can Learn. This page details the portfolios that Allan Roth recommends in his book.

Allan Roth Second Grader Portfolio: Beating Wall Street?

Who is Allan Roth and who is the second grader?

Allan Roth has written How a Second Grader Beats Wall Street: Golden Rules Any Investor Can Learn. He has served as CFO and is offering financial solutions. His portfolio the second grader portfolio is regarded as a lazy portfolio. We consider him as one of the good guys in investing due to his insistence of low fees, fiduciary responsibility and being adamant about keeping investing simple.

The story goes (in the book) that Allan Roth taught his son how to invest in the stock market. He did this when his son was in second grade. His son has subsequently beaten Wall Street by holding this portfolio!

In the book, Allan Roth describes the journey and reasoning for selecting the portfolio. The book is a masterpiece in itself in that it builds an ever-expanding foundation from which you can position your knowledge on investing upon. It’s like he builds a ladder for you, with each step you get a little smarter on how to invest and what the stock market is.

What is special about the Second Grader Portfolio?

Allan Roth’s Second Grader Portfolio is a close relative to the 3 fund portfolio.

This makes it easy to implement and maintain. Don’t worry though you will still get great returns.

Performance of the Second Grader Portfolios

Asset Allocation of Second Grader Portfolios

Allan Roth Second Grader Five-Fund High-Risk Portfolio                              

• 54.00%  US Total Stock Market   (VTI)
• 6.00%    REITs     (VNQ)
• 27.00%  International All-World ex-US     (VEU)
• 10.00%  Total US Bond Market    (BND)
• 3.00%    Precious Metals (GLTR)

Allan Roth Second Grader Five-Fund Low-Risk Portfolio               

• 18.00%  US Total Stock Market   (VTI)
• 2.00%    REITs     (VNQ)
• 10.00%  International All-World ex-US     (VEU)
• 70.00%  Total US Bond Market    (BND)

Allan Roth Second Grader Five-Fund Medium Risk Portfolio                       

• 36.00%  US Total Stock Market   (VTI)
• 4.00%    REITs     (VNQ)
• 20.00%  International All-World ex-US     (VEU)
• 40.00%  Total US Bond Market    (BND)

Allan Roth Second Grader High-Risk Portfolio                   

• 60.00%  US Total Stock Market   (VTI)
• 30.00%  International All-World ex-US     (VEU)
• 10.00%  Total US Bond Market    (BND)

Allan Roth Second Grader High Risk with CDs Portfolio                 

• 60.00%  US Total Stock Market   (VTI)
• 30.00%  International All-World ex-US     (VEU)
• 10.00%  Cash (money market fund)          (BIL)

Allan Roth Second Grader Low Portfolio                              

• 20.00%  US Total Stock Market   (VTI)
• 10.00%  International All-World ex-US     (VEU)
• 70.00%  Total US Bond Market    (BND)

Allan Roth Second Grader Low Risk with CDs Portfolio                  

• 20.00%  US Total Stock Market   (VTI)
• 10.00%  International All-World ex-US     (VEU)
• 70.00%  Cash (money market fund)          (BIL)

Allan Roth Second Grader Medium Risk Portfolio                            

• 40.00%  US Total Stock Market   (VTI)
• 20.00%  International All-World ex-US     (VEU)
• 40.00%  Total US Bond Market    (BND)

Allan Roth Second Grader Medium Risk with CDs Portfolio                         

• 40.00%  US Total Stock Market   (VTI)
• 20.00%  International All-World ex-US     (VEU)
• 40.00%  Cash (money market fund)          (BIL)

Alternatives to Second Grader Portfolios

There are a ton of alternatives to the Second Grader Portfolio. The most prominent is the 3 fund portfolio – also a Lazy Portfolios. All of Vanguard’s target date retirement fund use 3-4 fund (they also have an international bond fund). I also consider Rick Ferri’s portfolios to be in the same league as the Allan Roth’s Second Grader Portfolio.

Conclusion

Which portfolio do you use?

After having read up on Allan Roth’s Second Grader Portfolio I encourage you to find other great portfolios right here on portfolioeinstein.com.

If you have suggestions to new portfolios be sure to add them in comments or reach out to me.

I would love hearing from you!

This is the article detailing the investment portfolios of Paul Merriman. You will find asset allocation and performance measurements here.

Paul Merriman has constructed a lot of portfolios. This page details his many fantastic portfolios. Many of them outperform the S&P 500. Here you will find asset allocation and performance measures of Paul Merriman’s portfolios.

Paul Merriman Portfolios: Unbiased Outperformance

Who is Paul Merriman?

Paul Merriman, educator, entrepreneur and an all-around good guy in investing have a host of portfolios. They all express massive diversification and a slight to an extreme bias towards value and small cap, especially small-cap value which historically has been the best performing asset, class. Paul Merriman’s podcast is highly recommended, as are the many articles on his site. His personal finance book Get Smart or Get Screwed: How To Select The Best and Get The Most From Your Financial Advisor easily wins as the best-titled book on personal finance. His book Financial Fitness Forever: 5 Steps to More Money, Less Risk, and More Peace of Mind is fantastic and stuffed with sage advice, statics, and evidence-based best-investing practices.

For a detailed rundown of Paul Merriman’s Ultimate portfolio, you should read the article Paul Merriman’s Ultimate Portfolio: 10 X 10 = Winner?

Paul Merriman’s work on best ETFs inspired me to expand upon his work to create a best-in-class ETF and Mutuals fund overview for many more asset classes.

What is special about Paul Merriman’s portfolios?

Paul Merriman’s portfolios are characterized by one of two features:

1. Really good diversification through slicing and dicing.
2. A heavy concentration of a few high performing asset classes like small caps and/or small cap value.

Paul Merriman’s portfolios have evolved over the years. They used to have a good amount of bonds in them like the Ultimate portfolio. The ultimate portfolio no longer sports bonds. Paul Merriman is a big fan of small caps and value on which he has done extensive research.

Paul Merriman is an evidence-based investor and favors statistics over feelings.

His ultimate portfolio is a wonderful example of how diversification can bring higher returns without higher risk.

Paul Merriman is retired (he used to run his own investment consulting shop). The work he is doing now is strictly non-profit. All of his podcasts, articles and many other greats resources are without any profit motive. This makes him highly unbiased and trustworthy as he is not pushing any hidden agenda other than trying to help everyday investors. I am a big fan of Paul Merriman and the great work he is doing.

Paul Merriman is an evidence-based investor and favors statistics over feelings.

Performance of Paul Merriman’s portfolios

Asset Allocation of Paul Merriman’s Portfolios

Paul Merriman’s Best-in-Class ETFs Portfolio (Aggressive)                           

• 11.30%  US Large Cap Value         (VTV)
• 11.20%  US Large Cap      (VV)
• 11.30%  US Small Cap Value         (VIOV)
• 11.20%  US Small Cap      (VIOO)
• 5.00%    REITs     (VNQ)
• 9.00%    International Developed Blend      (VEA)
• 4.50%    Emerging Markets           (VWO)
• 9.00%    International Large Cap Value     (EFV)
• 9.00%    International Small Cap Blend             (VSS)
• 9.00%    International Small Cap Value             (DLS)
• 4.50%    Emerging Markets Small Cap       (EWX)
• 5.00%    International REITs          (VNQI)

This and the two portfolios below are part of his “best-in-class” portfolios. You can find them here.

Paul Merriman’s Best-in-Class ETFs Portfolio (Conservative)                      

• 4.50%    US Large Cap Value         (VTV)
• 4.50%    US Large Cap      (VV)
• 4.50%    US Small Cap Value         (VIOV)
• 4.50%    US Small Cap      (VIOO)
• 2.00%    REITs     (VNQ)
• 3.60%    International Developed Blend      (VEA)
• 1.80%    Emerging Markets           (VWO)
• 3.60%    International Large Cap Value     (EFV)
• 3.60%    International Small Cap Blend             (VSS)
• 30.00%  Intermediate-Term Treasuries       (VGIT)
• 18.00%  Short Term Treasuries       (VGSH)
• 12.00%  TIPS       (VTIP)
• 3.60%    International Small Cap Value             (DLS)
• 1.80%    Emerging Markets Small Cap       (EWX)
• 2.00%    International REITs          (VNQI)

Paul Merriman’s Best-in-Class ETFs Portfolio (Moderate)                            

• 6.80%    US Large Cap Value         (VTV)
• 6.70%    US Large Cap      (VV)
• 6.80%    US Small Cap Value         (VIOV)
• 6.70%    US Small Cap      (VIOO)
• 3.00%    REITs     (VNQ)
• 5.40%    International Developed Blend      (VEA)
• 2.70%    Emerging Markets           (VWO)
• 5.40%    International Large Cap Value     (EFV)
• 5.40%    International Small Cap Blend             (VSS)
• 20.00%  Intermediate-Term Treasuries       (VGIT)
• 12.00%  Short Term Treasuries       (VGSH)
• 8.00%    TIPS       (VTIP)
• 5.40%    International Small Cap Value             (DLS)
• 2.70%    Emerging Markets Small Cap       (EWX)
• 3.00%    International REITs          (VNQI)

Paul Merriman’s FundAdvice Ultimate Buy and Hold                     

• 6.00%    US Large Cap Value         (VTV)
• 6.00%    US Large Cap      (VV)
• 6.00%    US Small Cap Value         (VIOV)
• 6.00%    US Small Cap      (VIOO)
• 6.00%    REITs     (VNQ)
• 6.00%    Emerging Markets           (VWO)
• 6.00%    International All-World ex-US     (VEU)
• 6.00%    International Large Cap Value     (EFV)
• 6.00%    International Small Cap Blend             (VSS)
• 20.00%  Intermediate-Term Treasuries       (VGIT)
• 12.00%  Short Term Treasuries       (VGSH)
• 8.00%    TIPS       (VTIP)
• 6.00%    International Small Cap Value             (DLS)

Paul Merriman’s Target Date Portfolio (25-year-old)                     

• 70.00%  US Small Cap Value         (VIOV)
• 5.00%    Emerging Markets           (VWO)
• 20.00%  International Small Cap Value             (DLS)
• 5.00%    Emerging Markets Small Cap       (EWX)

Together with Chris Pedersen, Paul Merriman has constructed what he calls the ultimate target-date fund. These are characterized by tilting heavily into small-cap value, historically the best performing asset class.

This is an example of a Paul Merriman portfolio with a heavy concentration of few asset classes.

Paul Merriman’s Target Date Portfolio (35-year-old)                     

• 2.35%    US Large Cap Value         (VTV)
• 61.86%  US Small Cap Value         (VIOV)
• 4.73%    US Small Cap      (VIOO)
• 1.05%    REITs     (VNQ)
• 4.66%    Emerging Markets           (VWO)
• 0.81%    International All-World ex-US     (VEU)
• 0.81%    International Large Cap Value     (EFV)
• 0.81%    International Small Cap Blend             (VSS)
• 17.81%  International Small Cap Value             (DLS)
• 4.66%    Emerging Markets Small Cap       (EWX)
• 0.45%    International REITs          (VNQI)

Paul Merriman’s Target Date Portfolio (45-year-old)                     

• 5.98%    US Large Cap Value         (VTV)
• 44.49%  US Small Cap Value         (VIOV)
• 11.97%  US Small Cap      (VIOO)
• 2.66%    REITs     (VNQ)
• 3.78%    Emerging Markets           (VWO)
• 2.05%    International All-World ex-US     (VEU)
• 2.05%    International Large Cap Value     (EFV)
• 2.05%    International Small Cap Blend             (VSS)
• 3.50%    Intermediate-Term Treasuries       (VGIT)
• 2.10%    Short Term Treasuries       (VGSH)
• 1.40%    TIPS       (VTIP)
• 13.05%  International Small Cap Value             (DLS)
• 3.78%    Emerging Markets Small Cap       (EWX)
• 1.14%    International REITs          (VNQI)

Paul Merriman’s Target Date Portfolio (55-year-old)                     

• 9.13%    US Large Cap Value         (VTV)
• 21.74%  US Small Cap Value         (VIOV)
• 18.27%  US Small Cap      (VIOO)
• 4.06%    REITs     (VNQ)
• 2.47%    Emerging Markets           (VWO)
• 3.13%    International All-World ex-US     (VEU)
• 3.13%    International Large Cap Value     (EFV)
• 3.13%    International Small Cap Blend             (VSS)
• 12.00%  Intermediate-Term Treasuries       (VGIT)
• 7.20%    Short Term Treasuries       (VGSH)
• 4.80%    TIPS       (VTIP)
• 6.73%    International Small Cap Value             (DLS)
• 2.47%    Emerging Markets Small Cap       (EWX)
• 1.74%    International REITs          (VNQI)

Paul Merriman’s Target Date Portfolio (65-year-old)                     

• 7.87%    US Large Cap Value         (VTV)
• 7.88%    US Small Cap Value         (VIOV)
• 15.75%  US Small Cap      (VIOO)
• 3.50%    REITs     (VNQ)
• 1.35%    Emerging Markets           (VWO)
• 2.70%    International All-World ex-US     (VEU)
• 2.70%    International Large Cap Value     (EFV)
• 2.70%    International Small Cap Blend             (VSS)
• 25.00%  Intermediate-Term Treasuries       (VGIT)
• 15.00%  Short Term Treasuries       (VGSH)
• 10.00%  TIPS       (VTIP)
• 2.70%    International Small Cap Value             (DLS)
• 1.35%    Emerging Markets Small Cap       (EWX)
• 1.50%    International REITs          (VNQI)

Paul Merriman’s Ultimate Portfolio                       

• 10.00%  US Large Cap Value         (VTV)
• 10.00%  US Large Cap      (VV)
• 10.00%  US Small Cap Value         (VIOV)
• 10.00%  US Small Cap      (VIOO)
• 10.00%  REITs     (VNQ)
• 10.00%  Emerging Markets           (VWO)
• 10.00%  International All-World ex-US     (VEU)
• 10.00%  International Large Cap Value     (EFV)
• 10.00%  International Small Cap Blend             (VSS)
• 10.00%  International Small Cap Value             (DLS)

This is the portfolio that Paul Merriman features on MarketWatch. It shows the power of diversification that brings home very good returns while keeping risk in check.

Paul Merriman 2-Fund-Value-Portfolio

• 50.00%  US Large Cap Value         (VTV)
• 50.00%  US Small Cap Value         (VIOV)

This portfolio along with the 2 below are further examples of how a Paul Merriman portfolio that is heavily tilted towards value and small-cap.

Paul Merriman 4-Fund-Portfolio             

• 25.00%  US Large Cap Value         (VTV)
• 25.00%  US Large Cap      (VV)
• 25.00%  US Small Cap Value         (VIOV)
• 25.00%  US Small Cap      (VIOO)

Paul Merriman 5-Fund-Value-Portfolio

• 25.00%  US Large Cap Value         (VTV)
• 25.00%  US Small Cap Value         (VIOV)
• 20.00%  International Lg Cap Value           (EFV)
• 20.00%  Intl Sm Cap Value             (DLS)
• 10.00%  Emerging Markets Value               (FNDE)

Paul Merriman Ultimate Buy & Hold Strategy 2010                         

• 6.00%    US Large Cap Value         (VTV)
• 6.00%    US Large Cap      (VV)
• 6.00%    US Small Cap Value         (VIOV)
• 6.00%    US Micro Cap     (IWC)
• 6.00%    REITs (Real Estate)           (VNQ)
• 6.00%    Int. Developed Blend      (VEA)
• 6.00%    Emerging Markets           (VWO)
• 6.00%    International Lg Cap Value           (EFV)
• 6.00%    Intl Sm Cap Blend             (VSS)
• 20.00%  Intermediate-Term Treasury       (VGIT)
• 20.00%  Corporate Bonds              (LQD)
• 6.00%    Intl Sm Cap Value             (DLS)

This is a slightly different variant of the Ultimate portfolio. This one is from 2010. The bond portion of the portfolio is slightly different.

Together with Chris Pedersen, Paul Merriman has constructed what he calls the ultimate target-date fund

Alternatives to Paul Merriman’s portfolios

There are a few alternatives to Paul Merriman’s portfolios. Remember that his portfolios are either very diversified into many asset classes or they are very concentrated into few of the best historically performing asset classes. Therefore, if you want similar diversification then have a look at the IFA portfolios or some of David Booth’s portfolios. For concentrated portfolios, the best alternatives are from the FPL Capital Management Portfolios.

If you are looking for target-date funds be sure to check out our growing Target Date Fund Portfolio overview.

Conclusion

Which portfolio do you use? Why do you think the balanced portfolio too simple for you?

After having read up on Paul Merriman’s portfolios I encourage you to find other great portfolios right here on portfolioeinstein.com.

If you have suggestions to new portfolios be sure to add them in comments or reach out to me.

I would love hearing from you!

This is an updated and upgraded post on investment portfolios from the outstanding Whitecoat investor’s post 150 portfolios better than yours. In our article, we have included a lot more portfolios as well as asset allocation of all the portfolios and performance benchmarks and information on how to find additional information.

235 Portfolios Better Than Yours

There is no single perfect portfolio

There are a lot of portfolios out there! Every money management firm has their own portfolios. Not all portfolios are suited for your situation, however. For example, one portfolio is needed when you are saving for retirement and a different one is needed when you enter retirement.

It is easy to get lost in all those portfolios. That’s why you should ask yourself: What are my goals and what are my risk levels?

See the article How To Invest Money, 5 Simple Steps That Work For Anyone to get help.

There IS a portfolio for you.

Your own perfect portfolio

There is a perfect portfolio for you and your situation. The perfect portfolio for you is the one you stick with! It’s that simple. If you don’t stick with your portfolio and stay the course your chances of reaching your financial goals dimish.

Choose a portfolio and stick with it!

The asset allocation for all the portfolios can be found in the article Asset Allocation Of 235 Investment Portfolios

Portfolio performance and risk can be found here Investment Portfolios.

If you are unsure how to approach investing in the first place I suggest you start with reading the article How To Invest Money, 5 Simple Steps That Work For Anyone

If you need a target date retirement fund you can find more help in the article Target Date Fund Portfolios.

If you need help with finding a lazy portfolio check out the article Lazy Portfolios.

Finally, we have put the spotlight on robo advisors, you can find the article under Robo Advisor Performance.

Portfolio 1: The S&P 500 Portfolio

Yes, this is a real portfolio! Not just a benchmark. It is entirely viable to put all of your savings into an S&P 500 fund. John Bogle touted this as the best strategy in the book Common Sense on Mutual Funds. The returns are not markedly different than a Total Stock Market fund (TSM).

• 100.00%  S&P 500   (VOO)

Portfolio 2-10: The Balanced Portfolio with index funds

• 60.00%  US Total Stock Market   (VTI)
• 40.00%  Total US Bond Market    (BND)

The balanced portfolios consisting of two asset classes, stocks and bonds are the simplest portfolios to implement. You can mix and match the funds to your risk levels going from 90% stocks, 10% bonds to 90% bonds and 10% stocks. The 60/40 split often serve as a benchmark for institutions.

Portfolio 11: The Three Fund Portfolio by Taylor Larimore           

• 50.00%  US Total Stock Market   (VTI)
• 30.00%  International All-World ex-US     (VEU)
• 20.00%  Total US Bond Market    (BND)

The Three-fund portfolio is a hallmark of the Bogleheads forum. Taylor Larimore’s book on the three-fund portfolio lays out in detail the advantages of having a simple portfolio. The book is foreworded by John Bogle. You have a lot of option in changes the asset allocation of this portfolio.

Portfolio 12-15: Rick Ferri’s 4 Fund Portfolio (Core Four Portfolio)

• 30.00%  US Total Stock Market   (VTI)
• 6.00%    REITs     (VNQ)
• 24.00%  International All-World ex-US     (VEU)
• 40.00%  Total US Bond Market    (BND)

Rick Ferri is a former Navy fighter pilot. Author of some best books on investing, among them, probably my favorite is The Power of Passive Investing: More Wealth with Less Work. In his many books, he presents a ton of portfolios. They are all very well diversified and yields respectable returns. If you want to know more about ETFs you should pick up another “best-in-class” book The ETF Book: All You Need to Know About Exchange-Traded Funds if you want to know more about index funds you should REALLY pick that up.

Portfolio 16-19: 7Twelve Portfolios by Craig Israelsen

• 8.37%    US Large Cap      (VV)
• 8.33%    US Mid Cap         (IJH)
• 8.33%    US Small Cap      (VIOO)
• 8.33%    REITs     (VNQ)
• 8.33%    International Developed Blend      (VEA)
• 8.33%    Emerging Markets           (VWO)
• 8.33%    Total US Bond Market    (BND)
• 8.33%    Cash (money market fund)          (BIL)
• 8.33%    Commodities     (DBC / GSG)
• 8.33%    Gold      (IAU)
• 8.33%    TIPS       (VTIP)
• 8.33%    Non-US Bonds   (BNDX)

Craig L. Israelsen, Ph.D., is an Executive-in-Residence in the Financial Planning Program at Utah Valley University. He developed the 7-Twelve portfolio in order to create a portfolio with massive diversification. In his book 7Twelve: A Diversified Investment Portfolio with a Plan he lays out the portfolio. The portfolio consists of 7 asset classes and 12 funds (or ETFs) that invest in those asset classes.

Portfolio 20: The Unconventional Success Portfolio by David Swensen

• 30.00%  US Total Stock Market   (VTI)
• 20.00%  REITs     (VNQ)
• 5.00%    Emerging Markets           (VWO)
• 15.00%  International All-World ex-US     (VEU)
• 15.00%  Intermediate-Term Treasuries       (VGIT)
• 15.00%  TIPS       (VTIP)

David Swensen of the Yale Endowment fund sets forth the portfolio in his book Unconventional Success: A Fundamental Approach to Personal Investment David Swensen is truly one of the good guys in investing advocating fiduciary principles, low-cost index investing and being humble about one’s knowledge.

Portfolio 21: The Permanent Portfolio by Harry Browne

• 25.00%  US Total Stock Market   (VTI)
• 25.00%  Long Term Treasuries        (TLT)
• 25.00%  Cash (money market fund)          (BIL)
• 25.00%  Gold      (IAU)

One of the best know portfolios in the investing world. In his book Fail-Safe Investing: Lifelong Financial Security in 30 Minutes Harry Browne recommends holding four asset class that each protects against one of four outcomes in an economic climate. The excellent book The Permanent Portfolio: Harry Browne’s Long-Term Investment Strategy describes Browne’s philosophy style in greater detail.

Portfolio 22: Tony Robbins Master Your Money / Ray Dalio Portfolio

• 30.00%  US Total Stock Market   (VTI)
• 40.00%  Long Term Treasuries        (TLT)
• 15.00%  Intermediate-Term Treasuries       (VGIT)
• 7.50%    Commodities     (DBC / GSG)
• 7.50%    Gold      (IAU)

Tony Robbins set out to find out the perfect money advice and investing portfolio. In his book MONEY Master the Game: 7 Simple Steps to Financial Freedom he documents this. After having talked to some of the giants in the investment industry he recommends the above portfolio that is designed by hedge fund manager Ray Dalio. Ray Dalio, CEO of the largest hedgefund in the world, Bridgewater, is the guy behind the bestseller Principles and the risk parity approach in investing.

 Portfolio 23: Paul Merriman Ultimate Portfolio

• 10.00%  US Large Cap Value         (VTV)
• 10.00%  US Large Cap      (VV)
• 10.00%  US Small Cap Value         (VIOV)
• 10.00%  US Small Cap      (VIOO)
• 10.00%  REITs     (VNQ)
• 10.00%  Emerging Markets           (VWO)
• 10.00%  International All-World ex-US     (VEU)
• 10.00%  International Large Cap Value     (EFV)
• 10.00%  International Small Cap Blend             (VSS)
• 10.00%  International Small Cap Value             (DLS)

Paul Merriman, educator, entrepreneur and all-around good guy in investing have a host of portfolios. They all express massive diversification and a slight to an extreme bias towards value and small cap, especially small-cap value which historically has been the best performing asset class. Paul Merriman’s podcast is highly recommended, as are the many articles on his site. His personal finance book Get Smart or Get Screwed: How To Select The Best and Get The Most From Your Financial Advisor easily wins as the best-titled book on personal finance. His book Financial Fitness Forever: 5 Steps to More Money, Less Risk, and More Peace of Mind is fantastic and stuffed with sage advice, statics, and evidence-based best-investing practices.

This is the portfolio that Paul Merriman features on MarketWatch. It shows the power of diversification that brings home very good returns while keeping risk in check.

Portfolio 24-25: The Ivy Portfolios by Meb Faber

• 20.00%  US Total Stock Market   (VTI)
• 20.00%  REITs     (VNQ)
• 20.00%  International Developed Blend      (VEA)
• 20.00%  Total US Bond Market    (BND)
• 20.00%  Commodities     (DBC / GSG)

Co-written with Eric Anderson, Meb Faber’s book The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets lays out a strategy that attempts to mirror the investment portfolios of the Ivy Leagues Endowment fund like Yale, Harvard and Princeton. Especially Yale’s performance has been envious. Yale’s Endowment is led by David Swensen who also has a recommend portfolio on this site. Meb and Eric actually propose 3 portfolios with 5, 10, 20 asset classes.

Portfolio 26: Coffeehouse Portfolio by Bill Schultheis

• 10.00%  US Large Cap Value         (VTV)
• 10.00%  US Large Cap      (VV)
• 10.00%  US Small Cap Value         (VIOV)
• 10.00%  US Small Cap      (VIOO)
• 10.00%  REITs     (VNQ)
• 10.00%  International All-World ex-US     (VEU)
• 40.00%  Total US Bond Market    (BND)

The very famous Coffeehouse portfolio is categorized as a Lazy Portfolio due to its ease in its implementation and maintenance. Bill Schultheis have a beautiful website. Check out his book by the same title The Coffeehouse Investor: How to Build Wealth, Ignore Wall Street, and Get On with Your Life.

 Portfolio 27: Warren Buffett’s Portfolio

• 90.00%  US Large Cap      (VV)
• 10.00%  Short Term Treasuries       (VGSH)

In the 2013 letter to shareholders, Warren Buffett recommended that a trust is set up for his wife. This trust would invest 90% in a large-cap low-cost index fund (he recommended Vanguard) and 10% in short-term government bonds. He has since on a number of occasions reiterated this with the addition that average investors would be best served by low-cost index funds. You can read the entire letter here or get the deluxe version The Essays of Warren Buffett: Lessons for Corporate America.

 Portfolio 28-37: Index Fund Advisors Portfolios (IFA)

• 7.20%    US Large Cap Value         (VTV)
• 7.20%    US Large Cap      (VV)
• 12.00%  US Small Cap Value         (VIOV)
• 12.00%  US Small Cap      (VIOO)
• 1.50%    REITs     (VNQ)
• 2.40%    Emerging Markets           (VWO)
• 3.60%    International Large Cap Value     (EFV)
• 3.60%    International Small Cap Blend             (VSS)
• 10.00%  Short Term Treasuries       (VGSH)
• 3.60%    International Small Cap Value             (DLS)
• 3.00%    Emerging Markets Small Cap       (EWX)
• 2.40%    Emerging Markets Value               (FNDE)
• 10.00%  1 Year Fixed Income       (BSV)
• 10.00%  2 Year Global Fixed Income         (BNDX)
• 10.00%  5 Year Global Fixed Income         (BND/BNDX)
• 1.50%    International REITs          (VNQI)

Index Fund Advisors is headed up by Mark T. Hebner. It is an investment advisory firm using exclusively DFA funds and employing passive index strategies to achieve some very good returns. IFA provides a wealth of fantastic information on investing on their site. Mark Hebner’s book Index Funds: The 12-Step Recovery Program for Active Investors is a great way to get up to speed on why indexing and passive investing is a superior way to invest. IFA’s portfolios are characterized by their tilt towards value and small cap.

  Portfolio 38: The Andrew Tobias Portfolio

• 33.33%  US Total Stock Market   (VTI)
• 33.33%  International All-World ex-US     (VEU)
• 33.33%  TIPS       (VTIP)

Andrew Tobias of the best-selling book The Only Investment Guide You’ll Ever Need recommends this 3-fund portfolio in his book. This is very similar to the three-fund portfolio also featured here. It replaces the Total Bond Market Bond fund with a tips fund.

Portfolio 39: The Talmud Portfolio

• 34.00%  US Total Stock Market   (VTI)
• 33.00%  REITs     (VNQ)
• 33.00%  Total US Bond Market    (BND)

“Let every man divide his money into three parts, and invest a third in land, a third in business and a third let him keep by him in reserve.” So it is written in the Talmud, a record of debates among rabbis about Jewish law dating as early as 1200 B.C. And so it is written on Page 1 of Asset Allocation: Balancing Financial Risk, Fifth Edition: Balancing Financial Risk by Roger Gibson, supreme commander of asset allocation.

 Portfolio 40: Muhammad El-Erian’s Portfolio

• 18.00%  US Total Stock Market   (VTI)
• 13.00%  REITs     (VNQ)
• 18.00%  International Developed Blend      (VEA)
• 15.00%  Emerging Markets           (VWO)
• 6.00%    Long Term Treasuries        (TLT)
• 11.00%  Total US Bond Market    (BND)
• 13.00%  Commodities     (DBC / GSG)
• 6.00%    TIPS       (VTIP)

Mohamed El-Erian is former CEO of the PIMCO. PIMCO has 1.7 Trillion dollars under management. In El-Erian’s book When Markets Collide: Investment Strategies for the Age of Global Economic Change, he presents a shock absorbent long-term portfolio. He is often attributed with coming up the expression “new normal” in the post-financial crisis.

 Portfolio 41: The Marc Faber Portfolio

• 13.00%  US Large Cap      (VV)
• 25.00%  REITs     (VNQ)
• 8.00%    International Developed Blend      (VEA)
• 4.00%    Emerging Markets           (VWO)
• 25.00%  Total US Bond Market    (BND)
• 25.00%  Gold      (IAU)

Faber is the legendary permabear and author of the Gloom Boom & Doom Report.

 Portfolio 41: Ted Aronson Family Taxable Portfolio                  

• 5.00%    US Total Stock Market   (VTI)
• 15.00%  US Large Cap      (VV)
• 5.00%    US Small Cap Value         (VIOV)
• 10.00%  US Small Cap      (VIOO)
• 5.00%    US Small Cap Growth     (IJT)
• 10.00%  Emerging Markets           (VWO)
• 15.00%  Pacific Stocks     (VPL)
• 5.00%    European Stocks               (VGK)
• 10.00%  Long Term Treasuries        (TLT)
• 5.00%    High Yield Corporate Bonds         (HYG / JNK)
• 15.00%  TIPS       (VTIP)

Ted Aronson and his AJO Partners manage about $25 billion of institutional assets. Aronson puts his family’s taxable money in this well-diversified portfolio of no-load index funds. The portfolios are categorized as a Lazy Portfolio.

Portfolio 43-51: The Second Grader Portfolio by Allan Roth

• 36.00%  US Total Stock Market   (VTI)
• 4.00%    REITs     (VNQ)
• 20.00%  International All-World ex-US     (VEU)
• 40.00%  Total US Bond Market    (BND)

Allan Roth’s book How a Second Grader Beats Wall Street: Golden Rules Any Investor Can Learn puts forth 9 simple portfolios that have proven very capable over time. They are often lumped in the category of Lazy Portfolios because they are so easy to implement and maintain. He has portfolios with 3 funds, portfolios with 4 funds and portfolios with 5 funds. They are all excellent.

 Portfolio 52: Frank Armstrong Ideal Index Portfolio

• 9.25%    US Large Cap Value         (VTV)
• 6.25%    US Large Cap      (VV)
• 9.25%    US Small Cap Value         (VIOV)
• 6.25%    US Small Cap Growth     (IJT)
• 8.00%    REITs     (VNQ)
• 31.00%  International All-World ex-US     (VEU)
• 30.00%  Short Term Treasuries       (VGSH)

Frank Armstrong is the author of The Informed Investor: A Hype-Free Guide to Constructing a Sound Financial Portfolio. In his book, he presents the Ideal Index Portfolio. Frank Armstrong’s portfolio is tilted towards small-cap and value stocks while keeping a healthy dose of 30% in short-term treasuries which are considered very safe.

 Portfolio 53: Scott Adams Dilbert’s Portfolio

• 50.00%  US Total Stock Market   (VTI)
• 50.00%  Emerging Markets           (VWO)

Scott Adams, author of the comic strip Dilbert suggested this simple portfolio. As of 2017, it is the 3^rd best performing portfolio on portfolioeinstein.com. It is also the one with the highest standard deviation. Scott Adams’ portfolio is as interesting as his own life has been. He has written a wonderful little book,  How to Fail at Almost Everything and Still Win Big: Kind of the Story of My Life that teaches that failure is really the preamble to success. The Dilbert portfolio takes some wild swings because it holds 50% in emerging markets.

 Portfolio 54-62: Scott Burns Couch Potato

• 50.00%  US Total Stock Market   (VTI)
• 50.00%  TIPS       (VTIP)

Scott Burns, author of Spend ‘Til the End: The Revolutionary Guide to Raising Your Living Standard is a newspaper columnist and author who has covered personal finance and investments for over 30 years. He is known for creating the “Couch Potato Portfolio” investment strategy. In addition to the now-famous couch potato portfolio, he suggests 8 other portfolios on his AssetBuilder asset manager site. The 9 portfolios have a hierarchical nature to them each adding another asset class. The best performing portfolio is “Scott Burns Nine Emerging Portfolio”.

Portfolio 63-67: Larry Swedroe Simple Portfolio and 4 other portfolios

• 15.00%  US Large Cap Value         (VTV)
• 15.00%  US Small Cap Value         (VIOV)
• 13.00%  US Small Cap      (VIOO)
• 4.00%    Emerging Markets           (VWO)
• 13.00%  International Large Cap Value     (EFV)
• 40.00%  TIPS       (VTIP)

Larry Swedroe is a prolific author and Director of Research at wealth management firm Buckingham Strategic Wealth. He often visits the Bogleheads Forum where he shares insights, knowledge and answers questions. He is one of our favorite authors on investing. The best books include The Only Guide to a Winning Investment Strategy You’ll Ever Need,  Wise Investing Made Simpler and Your Complete Guide to Factor-Based Investing: The Way Smart Money Invests Today. His portfolios are characterized by investing in risky asset classes (small and value) while keeping the risk in check by allocating a large amount to safe bonds.

Portfolio 68-72: William Bernstein’s Four Pillars Portfolios and No Brainer Portfolio

• 25.00%  US Total Stock Market   (VTI)
• 10.00%  US Large Cap Value         (VTV)
• 10.00%  US Small Cap Value         (VIOV)
• 5.00%    REITs     (VNQ)
• 10.00%  International All-World ex-US     (VEU)
• 40.00%  Short Term Treasuries       (VGSH)

William Bernstein, a former doctor, investment consultant and an all-around good guy in the investing world has presented a host of portfolios through his career. His book, The Four Pillars of Investing: Lessons for Building a Winning Portfolio is required reading on investing. His investing philosophy is broad diversification, common sense and with a realistic expectation of future returns. Other books that are highly recommended are Rational Expectations: Asset Allocation for Investing Adults and The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk.

Portfolio 73: Rob Arnott’s Portfolio

• 10.00%  US Large Cap      (VV)
• 10.00%  REITs     (VNQ)
• 10.00%  International All-World ex-US     (VEU)
• 10.00%  Long Term Treasuries        (TLT)
• 20.00%  Corporate Bonds              (LQD)
• 10.00%  Commodities     (DBC / GSG)
• 10.00%  TIPS       (VTIP)
• 20.00%  Non-US Bonds   (BNDX)

Robert Arnott of Research Affiliates has proposed this portfolio in an article. Rob Arnott is a strong advocate for smart beta strategies his book The Fundamental Index: A Better Way to Invest explains how to get better returns from a factor-based index than a market cap weighted index can provide.

 Portfolio 74: The Global Market Portfolio, (“GMP”) CREDIT SUISSE

• 20.00%  US Large Cap      (VV)
• 5.00%    REITs     (VNQ)
• 5.00%    Emerging Markets           (VWO)
• 15.00%  International All-World ex-US     (VEU)
• 15.00%  Long Term Treasuries        (TLT)
• 22.00%  Corporate Bonds              (LQD)
• 2.00%    TIPS       (VTIP)
• 16.00%  Non-US Bonds   (BNDX)

A global market portfolio tries to replicates how all the global market asset are divided. This one is from Credit Suisse courtesy of Mab Faber in his book Global Asset Allocation: A Survey of the World’s Top Asset Allocation Strategies.

 Portfolio 75: The Global Market Portfolio, Financial Engines 2007

• 13.00%  US Large Cap Value         (VTV)
• 13.10%  US Large Cap Growth     (VUG)
• 3.70%    US Mid Cap Value            (JKI)
• 3.70%    US Mid Cap Growth        (IJK)
• 1.80%    US Small Cap Value         (VIOV)
• 1.80%    US Small Cap Growth     (IJT)
• 2.40%    Emerging Markets           (VWO)
• 8.10%    Pacific Stocks     (VPL)
• 15.80%  European Stocks               (VGK)
• 1.10%    Long Term Treasuries        (TLT)
• 5.30%    Intermediate-Term Treasuries       (VGIT)
• 6.20%    Total US Bond Market    (BND)
• 2.60%    Cash (money market fund)          (BIL)
• 3.40%    Corporate Bonds              (LQD)
• 18.00%  Non-US Bonds   (BNDX)

Based on data working within Financial Engines Christopher Jones, Chief Investment Officer at the firm presented this portfolio in his book The Intelligent Portfolio: Practical Wisdom on Personal Investing from Financial Engines. Financial Engines is the investment advisory firm you have never heard of. They are however the largest independent advisory firm in the US. It was taken private in 2018 and merged with Edelman Financial Services.

Portfolio 76: Meb Faber’s Risk Parity Portfolio

• 7.50%    US Total Stock Market   (VTI)
• 5.00%    REITs     (VNQ)
• 7.50%    International All-World ex-US     (VEU)
• 35.00%  Intermediate-Term Treasuries       (VGIT)
• 35.00%  Corporate Bonds              (LQD)
• 5.00%    Commodities     (DBC / GSG)
• 5.00%    Gold      (IAU)

This is Meb Faber’s risk parity portfolio from his blog where he compares it to Ray Dalio’s All Weather Portfolio (also on this site). Meb Faber is a quant and his books are worth a read and especially Global Asset Allocation: A Survey of the World’s Top Asset Allocation Strategies and The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets.

 Portfolio 77-80: Robo Advisor Betterment Portfolios

• 27.00%  US Total Stock Market   (VTI)
• 7.20%    US Large Cap Value         (VTV)
• 5.90%    US Mid Cap Value            (JKI)
• 5.00%    US Small Cap Value         (VIOV)
• 22.10%  International Developed Blend      (VEA)
• 12.80%  Emerging Markets           (VWO)
• 6.80%    Total US Bond Market    (BND)
• 2.40%    TIPS       (VTIP)
• 7.20%    Non-US Bonds   (BNDX)
• 3.60%    Emerging Market Bonds (EMB / VWOB)

Betterment is probably the most well-known fin-tech company. It started the robo advisor phenomenon. They have 13 Billion assets under management as per 2017. Their portfolios are well diversified and are some of the few that have emerging market bonds as an asset class. If you want to gain a greater insight into the robo advisory phenomenon I recommend picking up FinTech Innovation: From Robo-Advisors to Goal-Based Investing and Gamification.

 Portfolio 81-84: Robo Advisor Wealthfront Portfolio

The robo advisory firm came late to the robo advisory party but have enjoyed an immense amount of success. One of the giant of the investment world, Burton Malkiel, author of A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing, is the Chief Investment Officer at Wealthfront. Charles Ellis, another investing giant, and author of Winning the Loser’s Game, Seventh Edition: Timeless Strategies for Successful Investing is on the advisory board. If you want to gain a greater insight into the robo advisory phenomenon I recommend picking up FinTech Innovation: From Robo-Advisors to Goal-Based Investing and Gamification.

Portfolio 85-86: Roger Gibson’s Portfolio, Multi-asset

• 20.00%  US Total Stock Market   (VTI)
• 20.00%  REITs     (VNQ)
• 20.00%  International All-World ex-US     (VEU)
• 14.00%  Total US Bond Market    (BND)
• 20.00%  Commodities     (DBC / GSG)
• 6.00%    Non-US Bonds   (BNDX)

Roger Gibson, supreme commander of asset classes, offer two portfolios in his excellent book  Asset Allocation: Balancing Financial Risk, Fifth Edition: Balancing Financial Risk. It is the go-to book for all things related to asset allocation. Richard Ferri’s All About Asset Allocation is a close second though less detailed.

Portfolio 87: Harry Markowitz Portfolio “Father of Modern Portfolio Theory”

• 50.00%  US Total Stock Market   (VTI)
• 50.00%  Total US Bond Market    (BND)

Father of Modern Portfolio Theory (MPT) is not as you would expect a puzzle of calculations of mean-variance. Instead, Markowitz has stated he splits his portfolio evenly in bonds and stocks. There is a great piece on Harry Markowitz in Justin Fox’ book The Myth of the Rational Market.

Portfolio 88-94: Rick Ferri Early Saver Portfolio and 7 others

Rick Ferri is the author of some best books on investing, among them, probably my favorite is The Power of Passive Investing: More Wealth with Less Work. In his many books, he presents a host of portfolios. They are all very well diversified and yields respectable returns. If you want to know more about ETFs you should pick up another “best-in-class” book The ETF Book: All You Need to Know About Exchange-Traded Funds.

Portfolio 95: Total US Stock Market

• 100.00%               US Total Stock Market   (VTI)

Not so much a portfolio as a single stock fund. The total stock market is often a benchmark for fund managers tracking the Wilshire 5000. The difference between the S&P 500 and the total stock market is minuscule but noticeable due to the inclusion of value and small cap stocks in the total stock market which increases returns marginally. The is the portfolio of JL Collins of The Simple Path to Wealth: Your road map to financial independence and a rich, free life recommends as well as the one that John Bogle, supreme commander and hero of the investing world recommend in Common Sense on Mutual Funds.

Portfolio 96: The Jack Bogle Portfolio

• 60.00%  US Total Stock Market   (VTI)
• 40.00%  Total US Bond Market    (BND)

John Bogle, supreme commander and hero of the investing world, advocates holding bonds your age in proportion to your age. Your age = the percentage of bonds you should hold. The rest should be investing in a broadly diversified index fund. John Bogle’s book Common Sense on Mutual Funds is an absolute classic that you need to read.

Portfolio 97-99: Paul Merriman’s Best-in-Class ETFs Portfolio

• 11.30%  US Large Cap Value         (VTV)
• 11.20%  US Large Cap      (VV)
• 11.30%  US Small Cap Value         (VIOV)
• 11.20%  US Small Cap      (VIOO)
• 5.00%    REITs     (VNQ)
• 9.00%    International Developed Blend      (VEA)
• 4.50%    Emerging Markets           (VWO)
• 9.00%    International Large Cap Value     (EFV)
• 9.00%    International Small Cap Blend             (VSS)
• 9.00%    International Small Cap Value             (DLS)
• 4.50%    Emerging Markets Small Cap       (EWX)
• 5.00%    International REITs          (VNQI)

Portfolio 100-104: Paul Merriman’s Target Date Portfolio

• 2.35%    US Large Cap Value         (VTV)
• 61.86%  US Small Cap Value         (VIOV)
• 4.73%    US Small Cap      (VIOO)
• 1.05%    REITs     (VNQ)
• 4.66%    Emerging Markets           (VWO)
• 0.81%    International All-World ex-US     (VEU)
• 0.81%    International Large Cap Value     (EFV)
• 0.81%    International Small Cap Blend             (VSS)
• 17.81%  International Small Cap Value             (DLS)
• 4.66%    Emerging Markets Small Cap       (EWX)
• 0.45%    International REITs          (VNQI)

Paul Merriman, educator, entrepreneur and all-around good in investing have constructed a host of portfolios. They all express massive diversification and a slight to an extreme bias towards value and small cap Paul Merriman’s podcast is highly recommended, as are the many articles on his site. His personal finance book Get Smart or Get Screwed: How To Select The Best and Get The Most From Your Financial Advisor easily wins as the best-titled book on personal finance. His book Financial Fitness Forever: 5 Steps to More Money, Less Risk, and More Peace of Mind is fantastic and stuffed with sage advice, statics, and evidence-based best-investing practices.

Together with Chris Pedersen, Paul Merriman has constructed what he calls the ultimate target-date fund. These are characterized by tilting heavily into small-cap value, historically the best performing asset class.

Portfolio 105-109: iShares LifePath Index Fund Portfolio

• 50.02%  US Large Cap      (VV)
• 0.76%    US Small Cap      (VIOO)
• 16.24%  REITs     (VNQ)
• 1.13%    International Developed Blend      (VEA)
• 30.76%  International All-World ex-US     (VEU)
• 1.09%    Total US Bond Market    (BND)

The iShares target-date funds are no-fuzz straight up simple funds that give you broad exposure with a glide path towards retirement. You can see them here. iShares is the boutique of ETFs owned by Blackrock Inc. Blackrock is the world largest asset manager in the world (6.3 trillion dollars in 2017).

Portfolio 110-122: BlackRock Model Portfolios

• 44.00%  US Total Stock Market   (VTI)
• 36.00%  International All-World ex-US     (VEU)
• 15.00%  Total US Bond Market    (BND)
• 5.00%    Non-US Bonds   (BNDX)

The BlackRock model portfolio tool is available to advisors building portfolios for their clients. The model portfolios are simple 3-4 fund portfolios so they are easy to implement and maintain. You can try out the tool here. The model portfolios normally use iShares ETFs as building blocks. If you use Vanguard ETFs you save slightly on the fees.

Portfolio 123: Ben Stein’s Perfect Portfolio

• 20.00%  US Total Stock Market   (VTI)
• 20.00%  US Large Cap      (VV)
• 4.00%    REITs     (VNQ)
• 20.00%  International Developed Blend      (VEA)
• 12.00%  Emerging Markets           (VWO)
• 20.00%  Cash (money market fund)          (BIL)
• 4.00%    Energy  (XLE)

Ben Stein is a personal finance columnist and actor. He has written several books on personal finance and investing, the 2 that stand out are The Little Book of Bulletproof Investing: Do’s and Don’ts to Protect Your Financial Life and Yes, You Can Still Retire Comfortably!
The above portfolio is from here.

Portfolio 124-125: JL Collins, Simple Path To Wealth

• 100.00%               US Total Stock Market   (VTI)

JL Collins is a personal finance writer and author of the wonderful book The Simple Path to Wealth: Your Road Map to Financial Independence and a Rich, Free Life. It is highly recommended – also as an audiobook! His basic portfolio consists of one fund, while his preservation portfolio adds a bond fund to the mix. His how-to-invest series on his blog is worth your time. His second portfolio adds 25% Total US Bond Market.

Portfolio 126: Paul Merriman’s FundAdvice Ultimate Buy and Hold

• 6.00%    US Large Cap Value         (VTV)
• 6.00%    US Large Cap      (VV)
• 6.00%    US Small Cap Value         (VIOV)
• 6.00%    US Small Cap      (VIOO)
• 6.00%    REITs     (VNQ)
• 6.00%    Emerging Markets           (VWO)
• 6.00%    International All-World ex-US     (VEU)
• 6.00%    International Large Cap Value     (EFV)
• 6.00%    International Small Cap Blend             (VSS)
• 20.00%  Intermediate-Term Treasuries       (VGIT)
• 12.00%  Short Term Treasuries       (VGSH)
• 8.00%    TIPS       (VTIP)
• 6.00%    International Small Cap Value             (DLS)

Paul Merriman, educator, entrepreneur and all-around good in investing have a host of portfolios. They all express massive diversification and a slight to an extreme bias towards value and small cap, especially small-cap value which historically has been the best performing asset class. Paul Merriman’s podcast is highly recommended, as are the many articles on his site. This portfolio is from his now-defunct FundAdvice days.

Portfolio 127-130: Fidelity Freedom Index Portfolio

• 62.11%  US Total Stock Market   (VTI)
• 26.58%  International All-World ex-US     (VEU)
• 9.97%    Total US Bond Market    (BND)
• 0.02%    Cash (money market fund)          (BIL)
• 1.32%    Commodities     (DBC / GSG)

Fidelity Investments Inc. offers a slew of target-date retirement funds. Fidelity is a privately owned company being the 4^th largest in assets under management. It is featured in the book Fidelity’s World: The Secret Life and Public Power of the Mutual Fund Giant. The above portfolio is from the asset allocation of their target date funds.

Portfolio 131-135: TD Ameritrade Core Portfolio

• 43.00%  US Total Stock Market   (VTI)
• 27.00%  International All-World ex-US     (VEU)
• 26.00%  Total US Bond Market    (BND)
• 1.00%    Cash (money market fund)          (BIL)
• 3.00%    Non-US Bonds   (BNDX)

TD Ameritrade is a US brokerage that also offers to manage your portfolios. These are the asset allocations of those portfolios.

Portfolio 136-138: Morningstar Retirement Saver Portfolio

• 47.00%  US Total Stock Market   (VTI)
• 8.00%    US Small Cap Value         (VIOV)
• 20.00%  International Developed Blend      (VEA)
• 5.00%    Emerging Markets           (VWO)
• 20.00%  Total US Bond Market    (BND)

Christine Benz, director of personal finance at Morningstar, the fund rating company, has put together portfolios to help you save for retirement. In addition, she has also built portfolios for a 3-bucket approach when you already are in retirement. Those portfolios are not suited here but you can find them here. Christine Benz is the author of two wonderful books that come recommended. One is Morningstar 30-Minute Money Solutions: A Step-by-Step Guide to Managing Your Finances and the other is Morningstar Guide to Mutual Funds: Five-Star Strategies for Success.

Portfolio 139-142: Vanguard Target Retirement Portfolio

This is Vanguard’s stab at target-date retirement funds.  They are simple and well diversified. Vanguard has 5.1 Trillion dollars under management. The founder, John Bogle, is the supreme commander and hero of the investing world. If you only read two books on investing the second one would be Bogle’s Common Sense on Mutual Funds.

Portfolio 143-147: Merrill Lynch Edge Select Portfolio

• 9.00%    US Large Cap Value         (VTV)
• 14.00%  US Large Cap Growth     (VUG)
• 1.00%    US Small Cap Value         (VIOV)
• 1.00%    US Small Cap Growth     (IJT)
• 3.00%    Emerging Markets           (VWO)
• 9.00%    International All-World ex-US     (VEU)
• 17.00%  Intermediate-Term Treasuries       (VGIT)
• 2.00%    Cash (money market fund)          (BIL)
• 15.00%  Corporate Bonds              (LQD)
• 5.00%    High Yield Corporate Bonds         (HYG / JNK)
• 9.00%    Non-US Bonds   (BNDX)
• 15.00%  Mortgages (VMBS)

Merrill Lynch offers these portfolios through their Select Edge Portfolios. Their portfolios are some of the more complex ones with many asset classes. They are also the only ones on portfolioeinstein.com that include mortgages in their portfolios as a distinct asset class. In addition, their most aggressive portfolio holds 16% in bonds/cash which is unusual for that level of risk.

Portfolio 148-153: David Booth (DFA) Normal Portfolio

• 16.00%  US Large Cap Value         (VTV)
• 16.00%  US Large Cap      (VV)
• 8.00%    US Small Cap Value         (VIOV)
• 8.00%    US Small Cap      (VIOO)
• 8.00%    REITs     (VNQ)
• 2.40%    Emerging Markets           (VWO)
• 8.00%    International Large Cap Value     (EFV)
• 4.00%    International Small Cap Blend             (VSS)
• 5.00%    Intermediate-Term Treasuries       (VGIT)
• 4.00%    International Small Cap Value             (DLS)
• 3.20%    Emerging Markets Small Cap       (EWX)
• 2.40%    Emerging Markets Value               (FNDE)
• 5.00%    1 Year Fixed Income       (BSV)
• 5.00%    2 Year Global Fixed Income         (BNDX)
• 5.00%    5 Year Global Fixed Income         (BND/BNDX)

Co-founder and former CEO of Dimensional Fund Advisors (DFA) David Booth propose several portfolios in his article “Index and Enhanced Index Funds”. They are inline with the DFA methodology, as they are weighted towards value and small-cap. This is no surprise as two of the investment committee members of DFA are Eugene Fama and Kenneth French. They pioneered the model for describing asset class premia. Value and small-cap are among those asset classes that have the highest returns. The impact on investing by Fama cannot be understated and is eloquently detailed in The Myth of the Rational Market by Justin Fox.

Portfolio 154-157: Vanguard LifeStrategy Portfolios

• 24.00%  US Total Stock Market   (VTI)
• 16.10%  International All-World ex-US     (VEU)
• 42.00%  Total US Bond Market    (BND)
• 17.90%  Non-US Bonds   (BNDX)

This one-stop shop fund from Vanguard gives you full diversification in one fund. It is not a target-date fund as the asset allocation does not have a glide path. Vanguard has 5.1 Trillion dollars under management. The founder John Bogle is the supreme commander and hero of the investing world. If you only read two books on investing the second one would be Bogle’s Common Sense on Mutual Funds.

 Portfolio 158: William Bernstein’s Sheltered Sam Portfolio

• 15.00%  US Large Cap Value         (VTV)
• 12.00%  US Large Cap      (VV)
• 9.00%    US Small Cap Value         (VIOV)
• 3.00%    US Small Cap      (VIOO)
• 6.00%    REITs     (VNQ)
• 3.00%    Emerging Markets           (VWO)
• 3.00%    Pacific Stocks     (VPL)
• 3.00%    European Stocks               (VGK)
• 4.20%    International Large Cap Value     (EFV)
• 24.00%  Short Term Treasuries       (VGSH)
• 1.80%    Precious Metals (GLTR)
• 16.00%  TIPS       (VTIP)

William Bernstein, a former doctor, investment consultant and an all around good guy in the investing world has presented a host of portfolios through his career. His book, The Four Pillars of Investing: Lessons for Building a Winning Portfolio is often cited as required reading on investing. His investing philosophy is broad diversification, common sense and with a realistic expectation of future returns. Other books that come highly recommended are Rational Expectations: Asset Allocation for Investing Adults and The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk. This is one of several portfolios from his book.

Portfolio 159: Tim Maurer Simple Money Portfolio

• 7.50%    US Large Cap Value         (VTV)
• 7.50%    US Large Cap      (VV)
• 7.50%    US Small Cap Value         (VIOV)
• 7.50%    US Small Cap      (VIOO)
• 15.00%  International Large Cap Value     (EFV)
• 15.00%  International Small Cap Blend             (VSS)
• 40.00%  Intermediate-Term Treasuries       (VGIT)

In his fantastic little book Simple Money: A No-Nonsense Guide to Personal Finance, Tim Maurer of Buckingham Wealth Management (same firm as Larry Swedroe) present this portfolio. His book is very well worth a read. What is it with these guys at Buckingham? Do they all write good books?

Portfolio 160-169: T. Rowe Price ActivePlus Portfolio

• 49.00%  US Total Stock Market   (VTI)
• 21.00%  International All-World ex-US     (VEU)
• 27.00%  Total US Bond Market    (BND)
• 3.00%    TIPS       (VTIP)

T. Rowe Price is a US-based asset management company with 900 Billion dollars under management (2017). They offer a host of services. Managed portfolios being one of them. The portfolios presented here are the asset allocations which the model portfolios are benchmarked against. The managed portfolios would most likely be using their own actively managed funds to achieve similar portfolios.

Portfolio 170-173: Charles Schwab Target Date Fund Portfolio

• 48.43%  US Large Cap      (VV)
• 6.24%    US Small Cap      (VIOO)
• 4.57%    REITs     (VNQ)
• 6.90%    Emerging Markets           (VWO)
• 25.02%  International All-World ex-US     (VEU)
• 0.30%    Short Term Treasuries       (VGSH)
• 7.73%    Total US Bond Market    (BND)
• 0.81%    Cash (money market fund)          (BIL)

Charles Schwab founded his business in 1971 and is now one of the largest banks in the U.S with a brokerage and an ETF business. These portfolios are part of Schwab’s target date funds.

Portfolio 174-175: Time Inc. Money Portfolio

• 30.00%  US Total Stock Market   (VTI)
• 10.00%  REITs     (VNQ)
• 20.00%  International All-World ex-US     (VEU)
• 30.00%  Total US Bond Market    (BND)
• 10.00%  Non-US Bonds   (BNDX)

This portfolio along with the one below appeared on Timeinc.com money blog. It’s basically as 60/40 portfolio. The second portfolio has a tilt towards value.

Portfolio 176-181: Charles Schwab Managed Portfolio

• 22.00%  US Large Cap      (VV)
• 7.00%    US Small Cap      (VIOO)
• 5.00%    REITs     (VNQ)
• 20.00%  International Developed Blend      (VEA)
• 5.00%    Emerging Markets           (VWO)
• 26.00%  Total US Bond Market    (BND)
• 5.00%    Cash (money market fund)          (BIL)
• 6.00%    Commodities     (DBC / GSG)
• 1.00%    High Yield Corporate Bonds         (HYG / JNK)
• 2.00%    TIPS       (VTIP)
• 1.00%    Non-US Bonds   (BNDX)

Charles Schwab founded his business in 1971 and is now one of the largest banks with a brokerage and an ETF business. Schwab brokerage offer to manage your portfolios according to your risk level using a number of portfolios. Schwab also offers one-fund target-date retirement funds. The Charles Schwab story is interesting in itself and is vividly described in Charles Schwab: How One Company Beat Wall Street and Reinvented the Brokerage Industry.

Portfolio 182: Alpha Architect Robust

• 7.50%    US Large Cap Value         (VTV)
• 7.50%    US Small Cap Value         (VIOV)
• 10.00%  REITs     (VNQ)
• 7.50%    International Large Cap Value     (EFV)
• 20.00%  Intermediate-Term Treasuries       (VGIT)
• 10.00%  Commodities     (DBC / GSG)
• 30.00%  Momentum Factor          (MTUM)
• 7.50%    International Small Cap Value             (DLS)

Wes Gray and Jack Vogel over at AlphaArchitect constructed this portfolio. Alpha Architect normally employs mainly a tactical approach for portfolio construction. Alpha Architect has enjoyed a great deal of success because of their stock selection methodology, which they have documented several places. This portfolio stands out with its use a momentum asset class.

• DIY Financial Advisor: A Simple Solution to Build and Protect Your Wealth
• Quantitative Momentum: A Practitioner’s Guide to Building a Momentum-Based Stock Selection System
• Quantitative Value: A Practitioner’s Guide to Automating Intelligent Investment and Eliminating Behavioral Errors

Portfolio 183-185: Meb Faber’s GAA and GTAA Portfolios

• 3.75%    US Large Cap Value         (VTV)
• 3.75%    US Small Cap Value         (VIOV)
• 15.00%  REITs     (VNQ)
• 7.50%    International Developed Blend      (VEA)
• 7.50%    Emerging Markets           (VWO)
• 10.00%  Long Term Treasuries        (TLT)
• 10.00%  Intermediate-Term Treasuries       (VGIT)
• 10.00%  Corporate Bonds              (LQD)
• 15.00%  Commodities     (DBC / GSG)
• 10.00%  Non-US Bonds   (BNDX)
• 7.50%    Momentum Factor          (MTUM)

Meb Faber, Quant and productivity-meister galore regularly backtests portfolios. In his fantastic book Global Asset Allocation: A Survey of the World’s Top Asset Allocation Strategies, he has collected a host of different portfolios playing on the same theme – well-diversified portfolios. These portfolios make use of the momentum asset class.

 Portfolio 186: Bridgewater All Seasons Portfolio

• 18.00%  US Large Cap      (VV)
• 3.00%    US Small Cap      (VIOO)
• 6.00%    International Developed Blend      (VEA)
• 3.00%    Emerging Markets           (VWO)
• 40.00%  Long Term Treasuries        (TLT)
• 15.00%  Intermediate-Term Treasuries       (VGIT)
• 7.50%    Commodities     (DBC / GSG)
• 7.50%    Gold      (IAU)

This is also called a risk-parity portfolio. Bridgewater is the largest hedge fund manager in the world (2018) and offers this portfolio to guard against all possible economic scenarios. The above portfolio is featured in Meb Faber’s fantastic book Global Asset Allocation: A Survey of the World’s Top Asset Allocation Strategies. Ray Dalio is the CEO of Bridgewater and has recently published his bestseller Principles.

Portfolio 187: TrevH from Bogleheads Portfolio

• 25.00%  US Large Cap      (VV)
• 25.00%  US Small Cap Value         (VIOV)
• 25.00%  International Large Cap Value     (EFV)
• 25.00%  International Small Cap Blend             (VSS)

The common theme of slicing and dicing made TrevH of the Boglehead forum come up with a simpler portfolio of Paul Merriman’s Ultimate portfolio. The Boglehead forum is dedicated to spreading the investing philosophy of Vanguard’s founder John Bogle, supreme commander, and hero of the investing world. The Bogleheads have published the awesome book The Bogleheads’ Guide to Investing which is a fantastic primer on investing. If you’re thinking about retirement you should definitely pick up their book on retirement The Bogleheads’ Guide to Retirement Planning authored by Taylor Larimore and Rick Ferri among others.

Portfolio 188-202: Morningstar Lifetime Allocation Index

• 12.13%  US Large Cap Value         (VTV)
• 10.54%  US Large Cap      (VV)
• 9.26%    US Large Cap Growth     (VUG)
• 5.20%    US Mid Cap Value            (JKI)
• 4.52%    US Mid Cap         (IJH)
• 3.97%    US Mid Cap Growth        (IJK)
• 3.81%    US Small Cap Value         (VIOV)
• 3.31%    US Small Cap      (VIOO)
• 2.91%    US Small Cap Growth     (IJT)
• 2.93%    REITs     (VNQ)
• 25.26%  International Developed Blend      (VEA)
• 9.54%    Emerging Markets           (VWO)
• 3.00%    Total US Bond Market    (BND)
• 0.05%    Cash (money market fund)          (BIL)
• 2.62%    Commodities     (DBC / GSG)
• 0.25%    TIPS       (VTIP)

The Morningstar®Lifetime Allocation Indexes are Morningstar target-date retirement portfolios. There are A LOT of them as Morningstar has an aggressive, moderate and conservative fund for each target-date. No one other provider offers this. The portfolios have the most asset classes of all the portfolios on Portfolioeinstein.com including commodities in the construction.

Portfolio 203-206: Burton Malkiel Portfolio

• 35.00%  US Total Stock Market   (VTI)
• 10.00%  REITs     (VNQ)
• 17.50%  International Developed Blend      (VEA)
• 17.50%  Emerging Markets           (VWO)
• 5.00%    Cash (money market fund)          (BIL)
• 4.00%    Corporate Bonds              (LQD)
• 7.00%    Dividend Growth              (VIG)
• 4.00%    Emerging Market Bonds (EMB / VWOB)

Burton Malkiel is a giant in the investing industry and CIO at robo advisor firm Wealthfront. His wildly popular book, A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing, cemented the theory of the Efficient Market Hypothesis. In that book, he proposes several portfolios for the different stages in life.

Portfolio 207-210: Dimensional Fund Advisors Target Date Retirement Portfolios

• 26.00%  US Total Stock Market   (VTI)
• 26.00%  US Large Cap      (VV)
• 15.50%  International Developed Blend      (VEA)
• 7.60%    Emerging Markets           (VWO)
• 7.70%    International All-World ex-US     (VEU)
• 8.60%    Short-Term Investment Grade   (VCSH)
• 8.60%    2 Year Global Fixed Income         (BNDX)

Although late to the target-date retirement party DFA has launched a slew of target-date retirement funds. The funds from DFA are uncustomary lacking weighting towards value and small-cap. They also employ a good amount of TIPS. Don’t let that scare you. DFA employs Eugene Fama and Kenneth French on their investing committee. They pioneered the model for describing asset class premia. The impact on investing by Fama cannot be understated and is eloquently detailed in the Myth of the Rational Market by Justin Fox.

Portfolio 211-213: Paul Merriman 2-Fund-Value, 4-Fund-Value, 5-Fund-Value Portfolio

• 25.00%  US Large Cap Value         (VTV)
• 25.00%  US Large Cap      (VV)
• 25.00%  US Small Cap Value         (VIOV)
• 25.00%  US Small Cap      (VIOO)

Paul Merriman, educator, entrepreneur and all-around good in investing have a host of portfolios. They all express massive diversification and a slight to an extreme bias towards value and small cap, especially small-cap value. The above portfolios go all in on value asset classes and can be found on his website.

Portfolio 214-229: Dan Solin Super Smart Portfolios

Dan Solin is a veteran of the investment industry and is considered one of the good guys in investing. He has served at Index Fund Advisors and Buckingham Strategic Wealth (in company with Larry Swedroe, Tim Maurer). He is the author of the “Smart Series”. Small but powerful books on investing. These include: The Smartest Investment Book You’ll Ever Read: The Proven Way to Beat the “Pros” and Take Control of Your Financial Future and  The Smartest Portfolio You’ll Ever Own: A Do-It-Yourself Breakthrough Strategy.

Portfolio 230-235: TIAA-CREF Lifecycle Portfolios

• 59.90%  US Total Stock Market   (VTI)
• 18.50%  Int. Developed Blend      (VEA)
• 6.70%    Emerging Markets           (VWO)
• 14.90%  Total US Bond Market    (BND)

TIAA, formerly TIAA-CREF (Teachers Insurance and Annuity Association-College Retirement Equities Fund), is a Fortune 100 financial services organization that is the leading provider of financial services in the academic, research, medical, cultural and governmental fields. TIAA has $1 trillion in combined assets under management with holdings in more than 50 countries (as of 31 December 2017). These target date funds are all constructed using index funds. They also have other complex target date funds that have underlying active funds.

Summary and your next steps

With all these portfolios it can be hard to choose.

Which portfolio do you use and why?

Do you have any other portfolios that you want to have added?

Let me know in the comments!

The best target date fund (TDA) can be a hard choice. You have 10 to 60 years of savings in front of you so you absolutely need to pick the right target date fund. You only get one shot at retirement so picking the right fund means retiring in style instead of looking over your shoulder for bill collectors!

What Is The Best Target Date Fund?

Updated with 2018 returns.

Why you need a target date fund

Target date funds offer an easy way to manage your money. Investment companies offer them often as a 1-fund-solution. The date mentioned in the fund is the date (year) in the future where you are planning to retire. Let us take the example of Vanguard. Their 2050 target date fund is called:  Vanguard Target Retirement 2050 Fund. This means that if you are planning to retire at 65 years old in the year 2050 you should buy this fund.

All target date funds have one characteristic feature. They all make use of a glide path to guide the asset allocation within the fund. All target date funds make use of two main components in order to build their assets allocation and the glide path. The two components are risky assets and safe assets. These two components can be broken down into individual asset classes.

The risky assets include the following asset classes:

• Equities (stocks) (large-cap, small-cap, value, growth etc.)
• High yield bonds
• REITs
• Private equity
• Emerging market bonds
• Commodities

The safe assets include the following asset classes:

• Government bonds (from developed economies)
• High-grade bonds (investment grade corporate bonds)
• Cash (money market accounts)
• Municipal bonds
• TIPS

The glide path determines the ratio of risky assets to safe assets in the fund. The longer you have until retirement the more risky assets should be in your portfolio. For example, if you plan on retiring in 2060 you will have many risky assets in your portfolio (at least 90 % will be in risky assets). They offer the best returns over long periods but are more volatile. On the other hand, if you plan on retirement in 2030 you will have less in risky assets and more in safe assets (maybe closer to 50% in each).

Now here is the smart thing about target-date funds: They all balance their ratio of a risky and safe asset for each year you grow closer to retirement. You don’t have to do a thing, it all happens automatically. This is the glide path feature.

Source: JPMorgan