Larry Portfolio

The Larry Portfolio is the name for a class of portfolios promoted by Larry Swedroe and Kevin Grogan in the book Reducing The Risk of Black Swans.  The main idea is that by purchasing the highest return stock assets available, one can reduce overall stock exposure and maintain similar returns to other portfolio options but with less volatility.

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Asset Allocation

(*) Swedroe specifically recommends a combination of international developed small cap value and emerging market value.  A simple international small index contains the percentages of developed and emerging markets he recommends but it does not have the value tilt.  However, it should behave similarly enough to accurately illustrate how the concept works and is a nice option when more exotic international funds are not available or affordable.

Note: Because verified data is not available, this portfolio includes estimated returns prior to 1982.  Data for those years is highlighted on each chart.

 

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