The Ray Dalio All-Weather portfolio is built with five ETFs. The portfolio is exposed to 55% bonds, 30% stocks, and also own gold. It is a low-risk portfolio.
For the past 10 years, the All-Weather portfolio has returned 7.76 with a standard deviation of 7.31. Last year it returned 16.01%. The dividend yield is 1.55%. The 30-year return is 8.64%. Year to date the All-Weather portfolio has returned -3.85%%.
Here is the asset allocation of the All-Weather 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)
Article Contents
- Here is the asset allocation of the All-Weather portfolio
- What is is the return of The All-Weather Portfolio?
- Ray Dalio and Tony Robbins teams up to build the All-Weather portfolio
- Description of the All-Weather Portfolio
- Asset allocation pie chart for the Tony Robbins and Ray Dalio Portfolio
- Building the portfolio(s)
- What is the asset Allocation for Tony Robbins’ and Ray Dalio’s All-Weather portfolio?
- How we select the right ETFs
- What are the advantages and disadvantages of Tony Robbins / Ray Dalio’s All-Weather portfolio?
- Resources
- Suggestions for your next steps
- Summary
- Related questions
What is is the return of The All-Weather Portfolio?
| Name | Asset class count | Year to date | Return in 2020 | 10 year return | CAGR since 1989 (%) | Risk level | Expense ratio |
|---|---|---|---|---|---|---|---|
| Tony Robbins / Ray Dalio Portfolio | 5 | -3.85% | 16.01 | 7.76 | 8.64 | 1 | 0.16% |
Ray Dalio and Tony Robbins teams up to build the All-Weather portfolio
Tony Robbins is a renowned passionate motivational speaker. Ray Dalio is the CEO of Bridgewater which is the largest hedge fund in the world.
Tony Robbins has the uncanny ability to get you fired up about anything.
He got me fired up about the work he did with Ray Dalio on the All-Weather Portfolio.
In 2009 Tony Robbins decided to do something about the state of money management in America.
This is presented in his book, MONEY Master the Game: 7 Simple Steps to Financial Freedom. In that book, he goes through the steps to get you to be financially independent. Tony Robbins teamed up with fifty of the top finance and investment experts in the world. Ray Dalio is one of those top finance experts.
“Most people overestimate what they can do in a year, and they massively underestimate what they can accomplish in a decade or two. The fact is: you are not a manager of circumstance, you’re the architect of your life’s experience.”
– Tony Robbins
Description of the All-Weather Portfolio
Together the dynamic duo presents a portfolio that they believe will do well in any market climate. The portfolio is called the All-Weather portfolio.
There is also an All-Seasons portfolio. The All-Seasons portfolio was developed by the Bridgewater hedge fund that Ray Dalio oversees. The All-Weather portfolio is a more simple portfolio than the All-Seasons portfolio.
By simple, we don’t mean less capable but a portfolio that the average investor can build.
“If you can’t successfully do something, don’t think you can tell others how it should be done”
– Ray Dalio
Both are portfolios that pay homage to the Permanent Portfolio by Harry Browne. You can read more about the Permanent Portfolio in The Permanent Portfolio: Do Well No Matter What Happens
Asset allocation pie chart for the Tony Robbins and Ray Dalio Portfolio
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.
What is the asset Allocation for Tony Robbins’ and Ray Dalio’s All-Weather 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)
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.
What are the advantages and disadvantages of Tony Robbins / Ray Dalio’s All-Weather portfolio?
Advantages
- The portfolio is based on the All-Seasons strategy, a hugely successful investing strategy by the world’s largest hedge fund.
- The All-Weather investment portfolio is constructed by one of the most influential investment experts in the world (Ray Dalio).
- The portfolio holds asset classes with low correlation to each other (when one asset class goes up, another goes down)
- It is a low-risk portfolio – it’s drawdown is very small compared to the broader market.
- Tony Robbins (and Ray Dalio) has researched the portfolio thoroughly, and he doesn’t do anything half-heartedly!
Disadvantages
- The portfolio has lower returns than the S&P 500, mainly because of the higher bond portion of the portfolio.
- The portfolio has a risky bond allocation. The bond portion may not do well in (2018) a rising rate environment.
- The All-Weather investment portfolio may not give you high enough returns so that you can reach your financial goals.
Resources
Shortly after the book release, Tony Robbins published Unshakeable: Your Financial Freedom Playbook. This is a condensed version of Money: Master the Game
It is well worth your time. Tony Robbins writes with passion and has your best interests at heart.
The last resource that I want to share is the best selling book by Ray Dalio. It is filled with a lot of wisdom. It won’t make a billionaire like Ray Dalio but it will give you insights into his thinking.
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
Summary
The Tony Robbins / Ray Dalio’s portfolio is a portfolio built on the foundation of the successful investing strategy by Ray Dalio. It should do well in all market climates but may to too bond heavy and may not give you the returns that you require. The book by Tony Robbins is fantastic and if you don’t intend to implement the portfolio I encourage you to pick up his book as it is an eye-opener. Especially if you are new to investing and personal finance.
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Related questions
What is the 3 fund portfolio?
The three-fund portfolio is simple portfolios that you can build with three ETFs. The three ETF portfolio contains the following:
- US Stocks (VTI)
- International Stocks (VEU)
- US Bond Market (BND)
Does the All-Weather portfolio work?
The All-Weather portfolio works by allocating to different ETFs that rise or fall independent from eachother depending on the economic climate. The All-Weather portfolio will therefore not experience wild swings in the value.
