Want A Simple, 3-ETF Portfolio? Here Are 25 Of Them
Exchange-traded products have found their way into countless portfolios as investors of all walks have embraced these financial instruments for their ease-of-use, cost-efficiency, and unparalleled transparency. Institutional and self-directed money managers alike have taken advantage of ETFs as they offer instant diversification along with the ability to easily tap into virtually any asset class around the globe; with over 1,400 products on the market, there is an ETF for almost everything imaginable, spanning from gold funds to emerging markets small caps to international bonds and everything in between [Download 101 ETF Lessons Every Financial Advisor Should Learn].
A recent WSJ article by Anna Prior highlights the sheer diversity among products in the ETF universe and how investors can actually build fairly complete portfolios with just a few funds. In the spirit of simplicity, below we outline 25 All-ETF portfolios, each comprised of just three funds in total; please note that investors should adjust the suggested allocations within each of the strategies to better suite their individual risk preferences and current income needs.
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25. Global Stocks & Bonds
This strategy spans the entire globe, covering both equity and fixed income asset classes from both developed and emerging markets:
Ticker | ETF | Allocation |
Total Stock Market ETF | 50% | |
FTSE All World Ex US ETF | 30% | |
Madrona Forward Global Bond ETF | 20% | |
Portfolio Expense Ratio | 0.26% |
24. U.S. Total Market
This strategy is geared towards investors who are wary of international markets and would prefer to get foreign exposure tangentially through U.S. companies with overseas operations; a small bond component is also included to add diversification:
Ticker | ETF | Allocation |
S&P Equal Weight ETF | 40% | |
U.S. Small-Cap ETF | 40% | |
Total Bond Market ETF | 20% | |
Portfolio Expense Ratio | 0.22% |
23. Foreign Growth
This portfolio is not for the risk-averse as it focuses entirely on foreign developed and emerging markets equity funds along with an ex-U.S. bond component:
Ticker | ETF | Allocation |
International Equity ETF | 60% | |
Emerging Market SmallCap Fund | 20% | |
SPDR Barclays Intl Treasury Bond | 20% | |
Portfolio Expense Ratio | 0.28% |
22. Low Volatility
Anyone with capital preservation as a top priority ought to consider this “safer” equity-centric strategy:
Ticker | ETF | Allocation |
S&P 500 Low Volatility Portfolio | 50% | |
MSCI EAFE Minimum Volatility ETF | 30% | |
MSCI Emerging Markets Minimum Volatility ETF | 20% | |
Portfolio Expense Ratio | 0.24% |
21. Ex-Financials
This is another strategy geared towards more risk-averse investors who wish to entirely steer clear of the infamous financials sector:
Ticker | ETF | Allocation |
Dividend ex-Financials Fund | 50% | |
International Dividend ex-Financials Fund | 25% | |
Industrials Bond ETF | 25% | |
Portfolio Expense Ratio | 0.41% |
20. U.S. Dollar-Denominated
This strategy offers international stock and bond exposure while at the same time circumventing the inherent currency risk by utilizing U.S. dollar-denominated funds:
Ticker | ETF | Allocation |
MSCI EAFE Hedged Equity Fund | 60% | |
MSCI Emerging Markets Hedged Equity Fund | 20% | |
J.P. Morgan USD Emerging Markets Bond ETF | 20% | |
Portfolio Expense Ratio | 0.47% |
19. BRIC Bull
The name says it all, this strategy delivers targeted exposure to the BRIC markets:
Ticker | ETF | Allocation |
MSCI Brazil Capped ETF | 25% | |
Market Vectors Russia ETF | 25% | |
ISE Chindia Index Fund | 50% | |
Portfolio Expense Ratio | 0.61% |
18. Ex-Europe
Investors looking to steer clear of the debt-burdened currency bloc, but still wish to maintain international exposure, ought to consider this strategy:
Ticker | ETF | Allocation |
U.S. Broad Market ETF | 50% | |
FTSE Pacific ETF | 30% | |
Latin America 40 ETF | 20% | |
Portfolio Expense Ratio | 0.16% |
17. Cyclical-Tilt
This strategy focuses on the most cyclical sectors, and as such, should appeal to bullish investors with a stomach for volatility:
Ticker | ETF | Allocation |
SPDR S&P International Energy Sector ETF | 40% | |
SPDR S&P International Technology Sector ETF | 40% | |
Market Vectors Gaming ETF | 20% | |
Portfolio Expense Ratio | 0.53% |
16. Global Consumers
As a complement to the Cyclical-Tilt Portfolio, this strategy is based around consumer staples exposure across the entire globe, covering both developed and emerging markets; the bond component is heavily tilted towards consumer staples as well:
Ticker | ETF | Allocation |
Global Consumer Staples ETF | 50% | |
Emerging Markets Consumer | 25% | |
Industrials Bond ETF | 25% | |
Portfolio Expense Ratio | 0.53% |
15. Commodity Bull
This strategy is intended for those with a bullish outlook on the global economy and is balanced between commodity stocks and futures-based exposure to natural resource prices:
Ticker | ETF | Allocation |
Market Vectors Hard Assets Producers ETF | 40% | |
Market Vectors Agribusiness ETF | 40% | |
Rogers International Commodity ETN | 20% | |
Portfolio Expense Ratio | 0.56% |
14. ex-Japan
It’s no secret that Asian markets are going to account for a growing share of global GDP growth over the coming years; however, Japan has long been stuck in rut, and as such, this strategy entirely avoids exposure to this developed market in an otherwise booming region:
Ticker | ETF | Allocation |
MSCI All Country Asia ex Japan Index Fund | 50% | |
SPDR S&P Emerging Asia Pacific ETF | 30% | |
Australia & New Zealand Debt Fund | 20% | |
Portfolio Expense Ratio | 0.60% |
13. Warren Buffett Clone
This strategy revolves around the investment principles embraced by the Wall Street legend:
Ticker | ETF | Allocation |
Market Vectors Wide Moat Research ETF | 40% | |
Dividend Appreciation ETF | 40% | |
SmallCap Earnings Fund | 20% | |
Portfolio Expense Ratio | 0.31% |
12. Monthly Income
This strategy should appeal to conservative investors or those nearing retirement and in search of meaningful current income; each of the components here pays out a monthly dividend:
Ticker | ETF | Allocation |
SuperDividend ETF | 40% | |
KBW High Dividend Yield Financial Portfolio | 30% | |
Total Bond Market ETF | 30% | |
Portfolio Expense Ratio | 0.37% |
11. Emerging Markets Fever
This portfolio is intended for aggressive, long-term investors who wish to tap into the world’s fastest growing economies:
Ticker | ETF | Allocation |
Emerging Markets ETF | 50% | |
SPDR S&P Emerging Markets Small Cap ETF | 25% | |
MSCI Frontier 100 Index Fund | 25% | |
Portfolio Expense Ratio | 0.45% |
10. Commodity Countries
This strategy offers tangential exposure to commodity markets by focusing on the world’s largest producers of natural resources:
Ticker | ETF | Allocation |
ABC High Dividend ETF | 40% | |
Morningstar Global Upstream Natural Resources Index Fund | 40% | |
Dreyfus Commodity Currency Fund | 20% | |
Portfolio Expense Ratio | 0.56% |
9. Ultra-Cheap
The name says it all, this is a traditional stock-bond portfolio with the distinguishing feature being its rock-bottom expense ratio:
Ticker | ETF | Allocation |
U.S. Broad Market ETF | 50% | |
Europe Pacific | 30% | |
U.S. Aggregate Bond ETF | 20% | |
Portfolio Expense Ratio | 0.07% |
8. Hedge Fund Clone
For anyone looking to replicate the strategies of professional money managers, this is a great starting point:
Ticker | ETF | Allocation |
IQ Hedge Macro Tracker ETF | 35% | |
S&P CTI ETN | 35% | |
Managed Futures Strategy Fund | 30% | |
Portfolio Expense Ratio | 0.81% |
7. Retirement-Ready
Unlike most of the other strategies covered here, this portfolio is bond-heavy and geared towards very conservative investors who wish to preserve capital and generate a steady stream of income:
Ticker | ETF | Allocation |
Dividend Appreciation ETF | 20% | |
Total Bond Market ETF | 60% | |
TIPS Bond ETF | 20% | |
Portfolio Expense Ratio | 0.12% |
6. Growth-Tilt
This strategy is geared towards aggressive investors with a very long-term horizon in mind:
Ticker | ETF | Allocation |
Russell 3000 Growth ETF | 50% | |
MSCI EAFE Growth ETF | 30% | |
MSCI Emerging Markets Growth Index Fund | 20% | |
Portfolio Expense Ratio | 0.34% |
5. Storm Proof
This strategy looks to weather all economic environments by holding onto three asset classes that have historically generated stable returns over the long-haul:
Ticker | ETF | Allocation |
Consumer Staples Select Sector SPDR | 50% | |
1-30 Treasury Ladder Portfolio | 30% | |
DB Precious Metals Fund | 20% | |
Portfolio Expense Ratio | 0.32% |
4. All About Dividends
With interest rates still stuck at historically low levels, this strategy should appeal to anyone looking to generate meaningful current income:
Ticker | ETF | Allocation |
S&P Global Dividend Opportunities Index ETF | 60% | |
iBoxx $ High Yield Corporate Bond ETF | 25% | |
Emerging Markets High Yield Bond Fund | 15% | |
Portfolio Expense Ratio | 0.58% |
3. Tax Escape
This strategy is intended for investors that fall in the high-income tax bracket, and as such, it avoids dividend-paying securities; the bond component is also made up entirely of municipal debt, which is tax-exempt:
Ticker | ETF | Allocation |
Russell 1000 Growth ETF | 50% | |
Small-Cap Growth ETF | 20% | |
National AMT-Free Muni Bond ETF | 30% | |
Portfolio Expense Ratio | 0.20% |
2. Big Bear
Anyone looking to go against the bull trend should consider this strategy; however, note that the holdings here are intended to serve as complements to a traditional long-only portfolio:
Ticker | ETF | Allocation |
Defensive Equity ETF | 50% | |
Active Bear ETF | 30% | |
DB USD Index Bullish | 20% | |
Portfolio Expense Ratio | 0.96% |
1. All Abroad
Since most investors’ portfolios tend to have a glaring home-country bias, this strategy looks to avoid direct exposure to U.S. stocks and bonds:
Ticker | ETF | Allocation |
FTSE All World Ex US ETF | 65% | |
S&P/Citigroup International Treasury Fund | 20% | |
Emerging Markets Local Debt Fund | 15% | |
Portfolio Expense Ratio | 0.25% |
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Disclosure: No positions at time of writing.
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