Portfolio Construction Methodology
Step-by-step guide to building an investment portfolio aligned with your goals and risk tolerance.
Portfolio construction is a holistic discipline that takes into account your investment goals, risk tolerance, and time horizon to build a well-balanced strategy.
Table of Contents
1. Core-Satellite Strategy
Core (70-80%): Broad market index ETFs
Satellite (20-30%): Sector or thematic ETFs
Balances stability with growth potential
2. 3-Fund Portfolio
US Stock ETF (VTI)
International Stock ETF (VXUS)
Bond ETF (BND)
Simple yet highly effective
3. All Weather Portfolio
Stocks 30%, Long-term Treasuries 40%
Intermediate Treasuries 15%, Gold 7.5%, Commodities 7.5%
Designed to perform across all economic environments
4. Target Date Strategy
Adjusts asset allocation as your retirement date approaches
Higher equity exposure when young
Gradually shifts toward bonds as you age
Key Tips
- •A simple portfolio is easier to manage and stick with over time
- •Over-diversification can dilute returns without meaningful risk reduction
- •Regular review and rebalancing are essential for staying on track
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