Last Updated on
This article displays the ideal portfolio by Frank Armstrong. Here you will find a description, performance, and resources for the portfolio as well as detailed information on how to implement it yourself.
Article Contents
- Frank Armstrong Ideal Portfolio, But Ideal For Whom?
- Description of Frank Armstrong’s portfolio
- Performance of Frank Armstrong’s portfolio
- Building the portfolio(s)
- Asset Allocation for Frank Armstrong’s portfolio
- How we select the right ETFs
- Resources for Frank Armstrong’s portfolio
- Suggestions for your next steps
- Conclusion
Frank Armstrong Ideal Portfolio, But Ideal For Whom?
Frank Armstrong III is an investment advisor and the author of The Informed Investor: A Hype-Free Guide to Constructing a Sound Financial Portfolio.
He is the CEO and founder of the advisory firm Investor Solutions. Investor Solutions takes the fiduciary role very seriously.
Frank Armstrong has written several books, but the most famous one is The Informed Investor.
You can currently get his newest book for free on his website.
He often writes for Forbes.
Description of Frank Armstrong’s portfolio
Frank Armstrong presents the Ideal Index Portfolio in his book The Informed Investor: A Hype-Free Guide to Constructing a Sound Financial Portfolio. Frank Armstrong’s portfolio is tilted towards small-cap and value stocks.
It is relatively conservative. It holds 30% in short-term treasuries, which are considered an ultra-safe and a very low-volatile asset class.
The portfolio may be ideal for some people, but for others, it is way too conservative. If you are in your twenties, for example, you want to be at least 90% invested in stocks and preferably 100% in stocks.
Performance of Frank Armstrong’s portfolio
| Name | Asset class count | Year to date | Return in 2019 | 10 year return | CAGR since 1989 (%) | Risk level | Expense ratio |
|---|---|---|---|---|---|---|---|
| Frank Armstrong Ideal Index Portfolio | 7 | -10.31% | 18.54 | 7.10% | 7.49 | 2 | 0.09% |
Building the portfolio(s)
Below you can see the asset allocations for the portfolio(s). You can also see if the portfolio(s) has a socially responsible investing (ESG) variant portfolio. You can read more about socially responsible investing (ESG) investment portfolios in this post.
To build the portfolio(s) yourself, go to our best in class ETF page to see which ETF you should choose for a particular asset class. There you can also see which socially responsible investing ESG ETFs you should select.
Asset Allocation for Frank Armstrong’s portfolio
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)
How we select the right ETFs
There are a lot of ETFs out there. Most of them can be discarded because:
- They are too expensive
- They hold too few assets and are therefore too illiquid
- They do not meet the criteria for representing the asset class they are supposed to mirror.
We have carefully selected an ETF for each asset class that the portfolios on portfolioeinstein.com use. If you want to read more about our selection process and see what we consider the best ETFs please visit our article What Is The Best ETF?
If you are a European investor you need to buy European ETFs. We list 47 best ETFs in our article What Are The Best ETFs For European Investors? (Here Is 47).
As of 2020 we also track socially responsible investing ESG portfolios. Socially responsible investing (ESG) portfolios prioritize investing that puts an emphasis on environmental, social and corporate governance issues.
You can find the socially responsible investing ESG ETFs in the same article.
Resources for Frank Armstrong’s portfolio
Frank Armstrong’s business website, Investor Solutions.
I found his book Save Your Retirement: What to Do If You Haven’t Saved Enough or If Your Investments Were Devastated by the Market Meltdown to be optimistic and very relevant at the moment due to the coronavirus outbreak.
Suggestions for your next steps
Finding the correct portfolio is hard. Maintaining your portfolio is also daunting. If you are still in doubt about which portfolio to choose, we suggest you read our article How To Invest Money: 5 Simple Steps That Work For Anyone
If you have already committed to a portfolio – good for you! If you need help maintaining the portfolio you will find our rebalance worksheet useful. Rebalancing your portfolio lowers your risk and may even provide higher returns in the long run.
You can find the rebalance worksheet in our article Here Is The Most Easy To Use Portfolio Rebalance Tool
Conclusion
Frank Armstrong’s ideal portfolio is a solid contribution to how to structure a portfolio.
It may be conservative for some, but others will welcome the stability.
Would you change the sort-term treasuries with a broad market bond fund?
