This page displays medium-risk portfolios available on portfolioeinstein.com.
Some words on risk
Risk comes in many shapes and forms. In academia and in much of the investing industry, risk in investing is measured by standard deviation (a measure of how much the price of an asset bounces around).
Now, a standard deviation is, well – academic. This is because, for you and me, the risk is the pain we go through when we lose money. That pain is called draw-down. The draw-down of a portfolio is the amount of money the portfolio will lose in a given year. So, for example, a portfolio with a draw-down of -20% has at some point lost 20% of its value. That’s a good indication of what could happen in the future.
Now, that’s pretty actionable information that we can plan around and relate to.
A rough rule of thumb is that for each 20% of stocks a portfolio has it has a draw-down of -10%. So a 100% stock portfolio has potentially a draw-down of -50%. A 60% stock portfolio has a potential draw-down of -30%.
There are other forms of risk however but the draw-down is what we will focus on when dividing the portfolios into the various risk levels. You should also look at standard deviation as well as the stock to bond ratio.
How the risk levels are determined
We have given the portfolios a risk level from 1-5.
1 is the least risky but also offers the least reward.
5 is the riskiest but offers the most rewards.
The portfolios have been divided into quintiles. The first quintile, the first 20% represent the portfolios that have the lowest draw-downs. The last 20% are the ones with the highest draw-downs.
You can find the other 4 risk portfolios here:
This page is displaying the medium-risk portfolios. They are suited for medium term savings or when you simply cannot see yourself going through a large draw-down that the high risk portfolios potentially will expose you to.
Medium-risk portfolios
| Portfolio Name | Asset Allocation | Number of asset classes | CAGR since 1989 | Std | Drawdown | Risk Level |
|---|---|---|---|---|---|---|
| S&P 500 (Benchmark) |  | 1 | 9.84% | 17.46% | -37.71% | 5 - very high risk |
| 4 Fund Portfolio | | 4 | 7.80% | 10.27% | -21.47% | 3 - medium risk |
| 7Twelve Portfolio | | 12 | 7.57% | 10.32% | -23.19% | 3 - medium risk |
| David Swensen's Portfolio | | 6 | 8.55% | 11.47% | -26.20% | 3 - medium risk |
| Index Fund Advisors, Portfolio 60 | | 16 | 8.31% | 10.92% | -21.64% | 3 - medium risk |
| The Talmud Portfolio | | 3 | 9.04% | 10.79% | -24.14% | 3 - medium risk |
| Ted Aronson Family Taxable Portfolio | | 11 | 8.36% | 13.09% | -26.53% | 3 - medium risk |
| Allan Roth Second Grader Medium Risk Portfolio | | 3 | 7.66% | 10.66% | -21.61% | 3 - medium risk |
| Allan Roth Second Grader Five-Fund Medium Risk Portfolio | | 4 | 7.68% | 10.39% | -21.61% | 3 - medium risk |
| Allan Roth Second Grader Medium Risk with CDs Portfolio | | 3 | 6.48% | 10.43% | -22.79% | 3 - medium risk |
| Frank Armstrong Ideal Index Portfolio | | 7 | 7.19% | 11.40% | -25.74% | 3 - medium risk |
| Scott Burns Five Fold | | 5 | 7.72% | 9.94% | -23.09% | 3 - medium risk |
| Scott Burns Six Ways from Sunday | | 6 | 8.26% | 11.06% | -26.39% | 3 - medium risk |
| Larry Swedroe Simple Portfolio | | 6 | 8.27% | 11.11% | -23.85% | 3 - medium risk |
| The Global Market Portfolio, Financial Engines 2007 | | 15 | 8.04% | 11.30% | -23.12% | 3 - medium risk |
| Robo Advisor Betterment 60 | | 10 | 8.08% | 11.31% | -23.25% | 3 - medium risk |
| Robo Advisor Wealthfront 40 | | 7 | 8.40% | 11.51% | -25.94% | 3 - medium risk |
| Rick Ferri Early Saver Moderate Basic Portfolio | | 4 | 8.08% | 11.63% | -25.82% | 3 - medium risk |
| Rick Ferri Midlife Moderate Basic Portfolio | | 4 | 7.86% | 10.16% | -21.40% | 3 - medium risk |
| Rick Ferri Midlifer Moderate Multi Asset Portfolio | | 11 | 8.63% | 11.41% | -24.53% | 3 - medium risk |
| Rick Ferri Transitional Moderate Multi Asset Portfolio | | 12 | 8.24% | 10.00% | -20.84% | 3 - medium risk |
| Balanced Portfolio 70/30 | | 2 | 9.00% | 12.60% | -24.41% | 3 - medium risk |
| Index Fund Advisors, Portfolio 70 | | 16 | 8.58% | 12.47% | -25.65% | 3 - medium risk |
| Paul Merriman Target Date Portfolio (55 year old) | | 14 | 9.10% | 13.11% | -26.44% | 3 - medium risk |
| iShares LifePath Index 2030 Fund (55 year old) | | 7 | 7.93% | 11.62% | -26.20% | 3 - medium risk |
| iShares Model Portfolio 70% Stocks | | 4 | 7.54% | 12.32% | -26.42% | 3 - medium risk |
| iShares Model Portfolio 65% Stocks | | 4 | 7.57% | 11.48% | -24.02% | 3 - medium risk |
| JL Collins, Simple Path To Wealth, Wealth Preservation Portfolio | | 2 | 9.16% | 13.41% | -26.52% | 3 - medium risk |
| Paul Merriman FundAdvice Ultimate Buy and Hold | | 13 | 7.95% | 10.70% | -21.68% | 3 - medium risk |
| TD Ameritrade Core Portfolio Growth | | 5 | 7.62% | 12.29% | -26.33% | 3 - medium risk |
| Vanguard Target Retirement 2030 (55 year old) | | 4 | 7.59% | 12.34% | -26.42% | 3 - medium risk |
| Merrill Lynch Edge Select Portfolio, Moderately | | 12 | 8.59% | 11.48% | -25.30% | 3 - medium risk |
| David Booth (DFA) Normal Portfolio | | 15 | 8.00% | 10.24% | -21.28% | 3 - medium risk |
| Vanguard LifeStrategy Moderate Growth (60/40) | | 4 | 7.44% | 10.71% | -21.92% | 3 - medium risk |
| William Bernstein Sheltered Sam Portfolio | | 12 | 7.99% | 9.96% | -21.69% | 3 - medium risk |
| T. Rowe Price ActivePlus Portfolio, Model 60 | | 4 | 7.76% | 10.70% | -22.03% | 3 - medium risk |
| T. Rowe Price ActivePlus Portfolio, Model 70 | | 4 | 7.96% | 12.28% | -26.13% | 3 - medium risk |
| Schwab Target Date Fund 2030 (55 year old) | | 8 | 8.03% | 11.84% | -25.67% | 3 - medium risk |
| Schwab Managed Portfolio, Balanced With Growth | | 11 | 7.42% | 10.86% | -25.07% | 3 - medium risk |
| Time.Inc Money Portfolio 1, Simple and Cheap | | 5 | 7.70% | 10.07% | -21.56% | 3 - medium risk |
| Time.Inc Money Portfolio 2, Tilt Toward Value | | 7 | 7.98% | 9.94% | -20.91% | 3 - medium risk |
| Meb Faber GTAA Conservative | | 11 | 8.10% | 9.83% | -21.92% | 3 - medium risk |
| Morningstar Lifetime Allocation Index Moderate, 2030 | | 18 | 8.24% | 11.76% | -26.08% | 3 - medium risk |
| Morningstar Lifetime Allocation Index Conservative, 2040 | | 18 | 8.25% | 11.85% | -25.86% | 3 - medium risk |
| Dimensional 2030 Target Date Retirement Income Fund | | 8 | 7.35% | 10.37% | -23.00% | 3 - medium risk |
| Dan Solin SuperSmart Portfolio, Medium | | 8 | 8.13% | 10.29% | -21.06% | 3 - medium risk |
| Dan Solin The Smartest ETF Portfolio, Medium Risk | | 2 | 6.29% | 10.34% | -22.46% | 3 - medium risk |
| Dan Solin The Smartest Index Portfolio, Medium Risk | | 3 | 7.76% | 10.67% | -21.47% | 3 - medium risk |
| TIAA-CREF Lifecycle 2030 | | 6 | 8.30% | 12.35% | -25.56% | 3 - medium risk |
| William Bernstein Taxable Ted 70/30 | | 5 | 8.21% | 11.62% | -25.03% | 3 - medium risk |
| William Bernstein Sheltered Sam 60/40 | | 12 | 8.06% | 10.51% | -24.43% | 3 - medium risk |
| William Bernstein Sheltered Sam 50/50 | | 12 | 7.67% | 9.19% | -21.02% | 3 - medium risk |
| Goldman Sachs Target Date 2035 Portfolio | | 12 | 8.07% | 11.69% | -26.10% | 3 - medium risk |
| Rick Ferri Total Economy Core-4 Portfolio Moderate | | 4 | 7.54% | 9.99% | -21.64% | 3 - medium risk |
| Rick Ferri Global Markets Core-4 Moderate | | 4 | 7.69% | 10.57% | -20.92% | 3 - medium risk |
| Rick Ferri Income Seeker Core-4 Portfolio Moderate | | 4 | 8.01% | 11.00% | -24.65% | 3 - medium risk |
| Rick Ferri Socially Conscious ESG Core-4 Portfolio Moderate | | 4 | 7.96% | 10.75% | -21.73% | 3 - medium risk |
| 3 Fund Portfolio 60/40 | | 3 | 7.71% | 10.57% | -20.97% | 3 - medium risk |
| 3 Fund Portfolio Equal Weight | | 3 | 7.16% | 11.67% | -24.56% | 3 - medium risk |
| Paul Merriman Ultimate Buy & Hold Strategy 2010 | | 12 | 8.33% | 11.39% | -23.69% | 3 - medium risk |
| FPL Capital Management Portfolio 60 | | 9 | 8.78% | 10.60% | -21.43% | 3 - medium risk |
| FPL Capital Management Portfolio 70 | | 9 | 9.16% | 12.17% | -25.85% | 3 - medium risk |
| Fundamentum Enhanced Index Focus Moderate | | 5 | 8.19% | 10.92% | -21.63% | 3 - medium risk |
| Assetbuilder.com Portfolio 9 | | 14 | 8.52% | 11.81% | -23.05% | 3 - medium risk |
| Robo Advisor Wealthsimple Portfolio Balanced | | 9 | 8.30% | 11.58% | -24.58% | 3 - medium risk |
| Robo Advisor WiseBanyan 60% stocks | | 9 | 7.95% | 11.23% | -24.77% | 3 - medium risk |
| Robo Advisor WiseBanyan 50% stocks | | 9 | 7.75% | 9.75% | -20.92% | 3 - medium risk |
Disclaimer: There are many factors that go into choosing your right portfolio, though not as many as you would think. Therefore, the information here presented are not specific recommendations but instead for information purposes only.
Now it’s your turn!
Which portfolio are you leaning towards and why?
Why do you think a medium-risk portfolio is right for you?
