With the majority of ITA portfolios currently recommending no new purchases, now is a good time to rework the investment quiver if you are not completely satisfied with either the Factors or Asset Classes that make up your portfolio. Think through what asset classes or factors you want to include in the portfolio. Below are some suggestions.
Sample Investment Quiver
I generally begin with specific asset classes. Here are ones I consider essential to every portfolio other than the Dual Momentum accounts. These six ETFs mirror the recommendations that come out of the “Swensen Six.”
- U.S. Equities – My preference is to use VTI. If this is not a commission free ETF for you, another ETF might fill in for VTI.
- Developed International Equities – VEA is my preference. If one does not wish to include a specific ETF for Emerging Markets, then VEU is a good choice as it combines Developed and Emerging Market Equities.
- Emerging Market Equities – VWO is my go to ETF for this asset class. I would not include this ETF if using VEU for the #2 slot.
- U.S. Real Estate – VNQ is my choice for this asset class.
- Bonds – Here I generally go with either BND or AGG.
- Treasuries – TLT is my ETF of choice.
I consider the above six as first tier or essential ETFs to include in any portfolio. Now we move to the second tier group. This is where one begins to apply more judgment and I expect different investors will come up with different recommendations and choices.
Rather than I bias readers with my choices, please place your ETF recommendations in the Comment section provided below. If you are commenting for the first time, I need to approve your first message, so be patient. On occasion, a comment is caught in the Spam folder. I check that regularly, but if your comment does not immediately show up, the Spam net might be the problem – which I will solve.
Have a go and let me know what ETFs should be added to the “Swensen Six.”