The Ivy Portfolio by Meb Faber mimics the investing strategies of the Harvard and Yale endowments in a form that an individual investor can easily manage.
Home Country
Portfolio Charts is able to translate portfolio information to the local currency, inflation, and available funds of many different countries. Choose the home country where you live, and it will update every section of the page.
Asset Allocation
How to build an Ivy Portfolio
Other Versions
The charts show the historical results based on a fixed asset allocation. While I’m not able to model it, Faber also discusses the benefits of overlaying momentum strategies on the portfolio. So it’s worth reading his work to understand other approaches to the same idea.
Author
Meb Faber
Meb Faber is the co-founder and Chief Investment Officer of Cambria Investment Management. He talks about the Ivy Portfolio the book The Ivy Portfolio by Faber and Eric Richardson.
Overview
The Ivy Portfolio originates from the idea of studying the investing styles of the largest and most successful college endowments. While not every institutional investment is available to individuals like you and me, many of the core principles can be closely mirrored relatively easily with just a few core index funds.
The most notable feature of the Ivy Portfolio is a relatively large allocation to real assets, reflective of the investing choices of many endowments that diverge a bit from conventional wisdom. By equally weighting very different types of assets, it’s a good example of a more tactical investing mindset that seeks returns under every stone rather than holding tight to old allocation paradigms.
In professional investing circles, Meb Faber is perhaps best known for his famous work on Tactical Asset Allocation using momentum trading strategies. So it’s only natural that in the book he also discusses using momentum to trade in and out of Ivy assets depending on market trends. The charts here only track the passive buy and hold version of the Ivy Portfolio just like all of the other options, but if you’re interested in Faber’s full ideas I encourage you to read his work.
Performance
Since 1970, an investor in the United States holding the Ivy Portfolio earned an average 6.3% real return, with a baseline CAGR of 3.8% over 15 years. It supported a 4.4% safe withdrawal rate for 30 years and 3.6% indefinitely. Its worst peak-to-trough loss was 30%, and the longest a new investment spent below water was under 6 years.
Ivy Portfolio Performance
| # | Metric | What it measures |
|---|---|---|
| 6.3% | Average return | Mean annual return after inflation |
| 3.8% | Baseline real return (15 years) | What 15-year stretches returned in the weaker outcomes |
| 4.4% | Safe withdrawal rate (30 years) | Highest spending rate that lasted 30 years in the worst case |
| 3.6% | Long-term withdrawal rate | The SWR floor over very long retirements |
| 30% | Deepest drawdown | Worst peak-to-trough loss after inflation |
| 6 years | Longest drawdown | Longest a new investment stayed below what you put in |
| 10.4% | Volatility (standard deviation) | Year-to-year variation in returns |
Charts
Different ways to visualize the Ivy Portfolio
Comparisons
How the Ivy Portfolio compares to other options
Alternatives
Portfolios with a similar structure or design intent
Swensen Portfolio — Another interpretation of endowment investing ideas
7Twelve Portfolio — Wide diversification with a shared focus on real assets
Golden Butterfly — Another portfolio with five equal parts of unique assets
Articles
Insights that mention the Ivy Portfolio
Discussion
Join the conversation
