The truly free-floating Global Market Portfolio naturally shifts percentages of stocks, bonds, and other real assets every year, which makes it tricky to measure historical results and fairly compare the underlying risk to other portfolios. The percentages shown here represent the average portfolio composition since 1970, and the portfolio is rebalanced back to that average annually.

1. Allocating 10% of the stock portion (5% of the portfolio) to emerging markets is a little high in terms of historical averages, as easily investible EM stocks really didn’t become widespread until the 1990s. But since the percentage has leveled out and EM stocks are here to stay, it seems reasonable to allocate a representative portion of the portfolio to emerging markets.

2. The global market research specifically splits out separate categories for government bonds and other things like corporate, inflation-linked, and emerging market debt. I don’t have good data for every bond type, so I allocated them to government bonds of a similar average maturity. In my experience this is still a reasonable approximation for general study.

3. If you read the research, the 2% allocation is most commonly referred to as “commodities”. But dig deeper into the details, and the total invested commodities market studied has an average index weight of about 88% gold. So for both simplicity and accuracy, I allocated the full portion to gold rather than a much more diversified commodities index.

4. The paper calls for Developed World stocks. Since the explicit goal is to model the entire market, for the purposes of backtesting I split that into 85% Dev. Wld. large caps and 15% Dev. Wld small caps to properly model the returns using my data. But when building your own portfolio, a single all-cap Developed World fund should work the same.