PWL Capital, Nancy Graham Portfolios

PWL Capital Nancy Graham portfolios

PWL Capital was founded in 1996, but it is already a huge success story in Canada. In this post, we show you how to build the portfolios with ETFs. We also give you some background information and, of course, show you how the portfolios have performed.

What are the PWL Capital portfolios?

The PWL Capital portfolios are a series of investment portfolios made by PWL Capital of Canada. There are four sets of portfolios. The portfolios overweight Canadian stocks and bonds.

For the past 10 years, the PWL Capital Nancy And Her Team (US), Balanced portfolio has returned 6.89% with a standard deviation of 8.85%. The dividend yield is 2.17. The 30-year return is 6.77%. It is a medium risk portfolio.

How do you build the PWL Capital portfolios?

So, how do you build one of the PWL Capital Nancy And Her Team portfolios? This is for the (US), Balanced portfolio.

  • 30.00% Total US Stock Market (VTI)
  • 15.00% International Developed (VEU)
  • 1.70% REITs (VNQ)
  • 25.00% Short-Term Investment-Grade Bonds (VCSH)
  • 25.00% Global Bond Market (BNDW)
  • 3.30% Global REITs (VNQI)

You can find many more portfolios further below in the post. There you will also find the right ETFs that you want to use to build the portfolio.

What is the return of the PWL Capital Nancy And Her Team portfolios?

NameAsset class countYear to dateReturn in 201910 year returnCAGR since 1989 (%)Risk levelExpense ratio
PWL Capital Nancy And Her Team (CA), Conservative71.4112.494.58%5.5110.05%
PWL Capital Nancy And Her Team (CA), Cautious70.3614.295.23%5.9910.05%
PWL Capital Nancy And Her Team (CA), Balanced7-0.6716.095.88%6.4520.05%
PWL Capital Nancy And Her Team (CA), Assertive7-1.7217.886.51%6.8820.04%
PWL Capital Nancy And Her Team (CA), Aggressive7-2.7619.687.14%7.2920.04%
PWL Capital Nancy And Her Team (US), Conservative62.3413.285.19%5.7110.05%
PWL Capital Nancy And Her Team (US), Cautious61.6115.346.04%6.2610.05%
PWL Capital Nancy And Her Team (US), Balanced60.8917.46.89%6.7720.05%
PWL Capital Nancy And Her Team (US), Assertive60.1619.467.72%7.2620.05%
PWL Capital Nancy And Her Team (US), Aggressive6-0.5721.518.54%7.7320.05%

Who is PWL Capital?

PWL Capital was founded in 1996. It is a wealth management and financial planning firm. In 2020 they have four offices in Canada shared among their six teams.

I have known about PWL Capital for quite some time as they tend to spread their knowledge around. They have a podcast, and many of their employees do solo educational things on the side that has to do with financial planning or investing. See the resource section below to catch some links.

In that regard, they share a commonality with Ritholz Wealth management. Many of the employees at Ritzholz also do things on the side, be it blog authors, book authors, etc.

I like that approach as you can’t fake real interest and passion, so I don’t see the side hustles as marketing even though it serves that purpose. Wouldn’t you work with someone who loves what they do rather than somebody who just considers working with you their job?

you can’t really fake real interest and passion

I also like their no-nonsense attitude. Right there on their front page, it states:

Integrated Financial Planning and Asset Management.
No fads. No guesswork. No drama.

I’m sold!

I only have one gripe with PWL Capital, that’s up next.

Well, and a minor one too.

Description of PWL Capital Nancy And Her Team portfolios

PWL Capital has a lot of investment portfolios. Each team at PWL Capital has its own set of investment portfolios. I’m not entirely sure of the organizational structure of PWL Capital, but this makes sense for PWL Capital.

From an outsider looking in, it makes no sense, however. Sure there are all sorts of reasons why you want to have 30+ different investment portfolios, but not really. I don’t see the advantage of letting all the different teams decide on their own portfolios allocations. It just adds a lot of overhead. But I’m missing something, of course, PWL Capital, is, after all, is a huge success story. That is not meant as a snide comment, but the fact that I do not see the whole picture.

A minor gripe would be the naming convention of PWL Capital portfolios. In other teams at PWL Capital, they call their portfolios some rather vacuous nonsensical names like assertive, cautious and conservative, to indicate risk levels of the portfolios. I like Ritholz’ approach better. Barry Ritholz admitted that you almost always end up with dumb names for your portfolios, so at Ritholz, they just named the portfolios according to space and astrophysical themes like Saturn and Voyager. At least this removes the ambiguity. (And who doesn’t like space?)

What’s the difference between cautious and conservative in investing, anyway?

There is one thing that all of the PWL Capital Portfolios share, and that is simplicity.

They rarely use exotic asset classes. Instead, they are class light and favor broad asset classes. Although there are a few exceptions where the actual fund selection is quite puzzling. I’ll talk about that in a later post when I go through the portfolios of the other teams at PWL Capital.

Which funds and ETFs do PWL Capital Nancy And Her Team use?

The Nancy And Her Team portfolios use a mix of ETF and fund providers to build their portfolios. They use funds and ETFs from the following providers:

The providers are extraordinarily well-respected, and all use an index passive index strategy – with a few exceptions.

We see it as a positive sign that PWL Capital maintains a broad perspective of the selection of funds and ETF providers.

The PWL portfolios’ exposure to US stocks and International stocks is tilted towards value and small because they use include the Core funds from DFA. The Core fund from DFA tilts slightly towards small and value stocks.

You can read more on how DFA try to capture more of risk premia in our article on DFA model portfolios.

In our benchmarking, we have not used small or value funds to replicate the smart-beta allocation of the PWL Capital. In the past 10-15 years, value has underperformed growth. Because of this, our benchmark probably overstates the performance you would have seen if you had held these portfolios.

There are five PWL Nancy and Her Team portfolios. They vary in risk level, starting at 30% bonds 70% stocks up to 70% bonds and 30% stocks.

Their most aggressive portfolio only holds 70% stocks. Most other portfolios on portfolioeinstein.com would call a 70% stock portfolio conservative. If you are a young investor, then you don’t want to hold 30% bonds as 30% is a drag on your returns. With that said however, the best portfolio for you is the one you will stick with.

What is the Asset Allocation for PWL Capital Nancy And Her Team?

The following table shows the asset allocation for the US portfolios and the Candian portfolios.

NameTotal US MarketInternational DevelopedREITsShort Investment-Grade BondsGlobal BondsTotal Canadian StocksGlobal REITs
PWL Capital Nancy And Her Team (CA), Conservative9.00%9.00%1.00%35.00%35.00%9.00%2.00%
PWL Capital Nancy And Her Team (CA), Cautious12.00%12.00%1.30%30.00%30.00%12.00%2.70%
PWL Capital Nancy And Her Team (CA), Balanced15.00%15.00%1.70%25.00%25.00%15.00%3.30%
PWL Capital Nancy And Her Team (CA), Assertive18.00%18.00%2.00%20.00%20.00%18.00%4.00%
PWL Capital Nancy And Her Team (CA), Aggressive21.00%21.00%2.30%15.00%15.00%21.00%4.70%
PWL Capital Nancy And Her Team (US), Conservative18.00%9.00%1.00%35.00%35.00%2.00%
PWL Capital Nancy And Her Team (US), Cautious24.00%12.00%1.30%30.00%30.00%2.70%
PWL Capital Nancy And Her Team (US), Balanced30.00%15.00%1.70%25.00%25.00%3.30%
PWL Capital Nancy And Her Team (US), Assertive36.00%18.00%2.00%20.00%20.00%4.00%
PWL Capital Nancy And Her Team (US), Aggressive42.00%21.00%2.30%15.00%15.00%4.70%

PWL Capital’s portfolios do contain allocations to Canadian stocks. They overweight Canadian stocks quite a bit. That’s a general trend that I have noticed with Canadian wealth managers and Canadian investing experts. They overweight quite massively Canadian stocks. This makes me conclude that Canadians have a considerable home country bias. But who can blame them? Canada is beautiful! And Canada has one of my favorite companies in the world, Brookfield Asset Management.

For the portfolios to be useful to the rest of the world and the US, in particular, I have made US counterpart portfolios from PWL Capital’s Canada heavy portfolios.

It means that I have swapped Canadian stock allocations to US stocks and I have swapped Candian bonds with US bonds.

Notice there are two sets of portfolios. One is Canadian and the other is the US. PWL capital uses the Canadian variant. The US variant is our guess on how PWL Capital’s portfolios would look like if a client were based in the US.

Resources for PWL Capital Nancy And Her Team

PWL Capital’s YouTube channel act as a hub for all the videos the employees put out.

Here is an excellent interview that Benjamin Felix and Cameron Passmore did with Barry Ritholtz from Ritholz Wealth management. I could listen to Barry Ritzholz all day.

Benjamin Felix and Cameron Passmore from PWL Capital hosts the Rational Reminder podcast. It is excellent, and they have some interesting guests.

PWL Capital has a research section on their site where they try to make sense of the investing world. It’s not overly original research they do, and it is one area where they could shine if they put a little more effort into it.

Canada Couch Potato is made by Dan Bortolotti, portfolio manager at PWL Capital.

Canadian Portfolio Manager is a site made by Justin Bender of PWL Capital.

You can find the other portfolios from PWL Capital that we have covered:

Related questions

What is the best Fama-French ETF?
The best Fama-French smart-beta ETF is the iShares Edge MSCI USA Quality Factor ETF (QUAL)

What are the Ben Felix Factor Investing portfolios?
You can find the factor based portfolios of PWL capital here. They partly use DFA Vector funds which are smart-beta funds.

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