The 7Twelve Portfolio is recommended by Craig Israelsen in his book 7Twelve: A Diversified Investment Portfolio with a Plan. The name is derived from equally dividing your portfolio between 12 funds in 7 asset categories: domestic stocks, international stocks, real estate, resources, domestic bonds, international bonds, and cash.
- 8.3% Large Cap Blend
- 8.3% Mid Cap Blend
- 8.3% Small Cap Blend
- 8.3% International Stocks
- 8.3% Emerging Markets
- 17% Intermediate Bonds¹
- 8.3% International Bonds
- 8.3% Cash
- 16.6% Commodities²
- 8.3% REITs
1. Israelsen specifically recommends equal parts nominal bonds and TIPS. Since I don’t have specific data for TIPS, I allocated this portion to intermediate term bonds. While this is a pretty good proxy that should model the design intent reasonably well, be sure to read Israelsen’s justifications for why he chooses the bonds he does.
2. He specifically recommends 8.3% commodities and 8.3% natural resources, but good data for natural resources is not available. Keeping with his theme of having two equal segments in the “resources” category, I allocated the natural resources to the commodities portion. There’s a decent amount of overlap in commodities and natural resources ETFs, so I anticipate this will not change the results all that much.
3. The Portfolio Charts tools use round numbers, so I reallocated the portfolio slightly while preserving the original design intent as closely as possible.
Change the home country to translate the portfolio to local assets, currency, and inflation