Coffeehouse Portfolio

The Coffeehouse Portfolio by Bill Schultheis is a traditional 60% stock portfolio that seeks to capture market returns while subdividing the stocks into several targeted funds.

Asset Allocation
Performance
Author
Overview
Articles
Books
Discussion
Alternatives

Asset Allocation

%	Asset Class
10%	Large Cap Blend Stocks
10%	Large Cap Value Stocks
10%	Small Cap Blend Stocks
10%	Small Cap Value Stocks
10%	International Large Cap Blend Stocks
40%	Intermediate Term Bonds
10%	REITs

Performance

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Portfolio Charts

Author

Bill Schultheis

Bill Schultheis is a Wall Street veteran and a financial adviser at Soundmark Wealth Management. He talks about the Coffeehouse Portfolio in his book The Coffeehouse Investor.

Overview

The Coffeehouse Portfolio straddles an interesting line between promoting a conservative Classic 60-40 mindset while mixing in a more aggressive slice and dice approach to factor investing. Its author Bill Schultheis believes that the most important concepts in investing are actually not so much about specific asset choices but about three key principles:

Don’t put all your eggs in one basket
There’s no such thing as a free lunch
Save for a rainy day

In fact, in his unique humble style Schultheis underplays the specific asset allocation on his Coffeehouse Investor blog. He once explained that his initial portfolio recommendation was intended to be just one example of a Coffeehouse-style portfolio, but that his suggestion soon took on a life of its own. As he described it:

Despite its enduring popularity, the portfolio benefit isn’t found in its specific construction nor its 20-year returns. It’s found in investors “capturing their fair share of market returns” over time, as Mr. Bogle was fond of saying.

So one could argue that the Coffeehouse Portfolio might best be described as a mindset rather than a single specific asset allocation. Still, I think Schultheis perhaps sells himself a little short in his recommended portfolio. Even if it was just one example, I find a lot of wisdom in his work and believe his instincts are absolutely worth further study.