HOW TO CREATE A MODERATELY CONSERVATIVE INVESTMENT PORTFOLIO

Welcome to the Real Sense Podcast where we bring bite sized advice to help you make real sense of money, the markets, and helping you create a legacy for you and your family. In this episode we are going to go over how to make a conservative portfolio for an investor. I am your host, Isaiah Real, Financial Advisor for Laguna Wealth Advisors

Throughout this episode I will share with you what types of people tend to invest in this type of portfolio and why. Sharing and giving to you an example of a conservative portfolio provided by Charles Schwab going over what type of investments to invest in a conservative portfolio as well as the exact percentages of how much to put into each investment. Lastly, I’ll share with you outcomes. Charles Schwab Investment Advisory with data provided by Morningstar, Inc. provide an average annual return, best year, and worst year, from the portfolio put together through historical data from 1970-2014.

Source: Charles Schwab Investment Advisory with data provided by Morningstar, Inc. The return figures for 1970–2014
are the compounded annual average and the minimum and maximum annual total returns of hypothetical asset allocation plans. The asset allocation plans are weighted averages of the performance of the indices used to represent each asset class in the plans, include reinvestment of dividends and interest, and are rebalanced annually. The indices representing each asset class in the historical asset allocation plans are S&P 500® Index ( large-cap stocks); CRSP 6–8 Index for the period 1970–1978 and Russell 2000® Index for the period 1979–2014 (small-cap stocks); MSCI EAFE® Net of Taxes ( international stocks); Ibbotson
Intermediate-Term Government Bond Index for the period
1970–1975 and Barclays U.S. Aggregate Bond Index for the period 1976–2014 (fixed income); and Ibbotson U.S. 30- day Treasury Bill Index for the period 1970–1977 and Citigroup 3-month U.S.
Treasury Bills for the period 1978–2014 (cash investments). Indices are unmanaged, do not incur fees or expenses, and cannot be invested in directly. Past performance is no indication of future
results.

Sources:
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15 Small Company Stocks You Should Own Now. (n.d.). In Forbes. Retrieved March 29, 2018, from https://www.forbes.com/pictures/mee45edfe/15-small-company-stocks-you-should-own-now/#791e25f03d9c

Fixed Income. (n.d.). In Investopedia. Retrieved March 21, 2018, from https://www.investopedia.com/terms/f/fixedincome.asp

Gibley, M. (24 July 2012). Why Invest Internationally? Retrieved from https://www.schwab.com/resource-center/insights/content/why-invest-internationally

Kiesnoski, K. (8 March 2017). The Top 10 US Companies by Market Capitalization. Retrieved from https://www.cnbc.com/2017/03/08/the-top-10-us-companies-by-market-capitalization.html#slide=12

Large Cap – Big Cap. (n.d.). In Investopedia. Retrieved March 21, 2018, from https://www.investopedia.com/terms/l/large-cap.asp

“Optional” Investor Profile Questionnaire (2015). Retrieved from Charles Schwab & Co.

Segal, T. (13 March 2018). An Introduction To Small Cap Stocks. In Investopedia. Retrieved March 29, 2018, from https://www.investopedia.com/investing/introduction-to-small-cap-stocks/

Tokat, Y. & Wicas, N. (2005). International Equity Investing: Long-Term Expectations and Short-Term Departures. Retrieved from https://personal.vanguard.com/pdf/flgcii.pdf

Yesim Tokat and Nelson W. Wicas, 2005. Short-Run Considerations for the Long-Term International Investor. Journal of Investing 14(1):32–40.

Information throughout this video, whether stock quotes, charts, articles, or any other statement or statements regarding market or other financial information, is obtained from sources which we, and our suppliers, believe reliable, but we do not warrant or guarantee the timeliness or accuracy of this information.  Nothing on this video should be interpreted to state or imply that past results are an indication of future performance.  Neither we nor our information providers shall be liable for any errors or inaccuracies, regardless of cause, or the lack of timeliness of, or for any delay or interruption in the transmission thereof to the user.