The Swensen Portfolio by David Swensen packages the investing ideas used by the Yale Endowment in a format accessible to normal investors.
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 a Swensen Portfolio
Asset Notes
1. Swensen specifically calls for 15% TIPS as part of the bond portion of the portfolio. I don’t have good data for that asset, so I added it to the overall IT bond allocation. Be sure to read Swensen’s explanation for why he chooses the assets he does.
Other Versions
The allocation here is the one discussed in Unconventional Success. In later interviews, Swensen recommended a small tweak where he shifted an additional 5% of the REIT allocation to emerging markets.
Author
David Swensen
David Swensen was the famed Chief Investment Officer at Yale who led their endowment for more than three decades. He talks about the Swensen Portfolio in his book Unconventional Success.
Overview
David Swensen is most famous for his role as Chief Investment Officer of the Yale Endowment, one of the largest endowments in the world famous for its sustained superior returns. But since the Yale Endowment manages billions of dollars and invests in all kinds of exotic assets only available to large institutions, its methods are not that attainable by your average retail investor. Swensen sought to correct that shortcoming, however, and the Swensen Portfolio is his personal investing recommendation to people like you and me.
Swensen’s philosophy goes far beyond simple asset allocation. True to his principles that are sadly all too rare among big-time investors, his book Unconventional Success makes a compelling case for individuals to take control of their investments from the financial industry that does not have their best interests in mind.
One of the notable features of the Swensen Portfolio is a sizable allocation to REITs that reflect a common endowment strategy not always embraced by mainstream asset allocators. The balance between stocks, bonds, and real assets is an important part of what makes it tick, and the Swensen Portfolio serves as an educational window into the inner workings of some of the most successful funds that are responsible not for fleeting returns but for decades of sustainable growth and income. It may especially appeal to investors like early retirees who share similar goals.
Featured Discussion
Performance
Since 1970, an investor in Switzerland holding the Swensen Portfolio earned an average 5.9% real return, with a baseline CAGR of 4.4% over 15 years. It supported a 3.8% safe withdrawal rate for 30 years and 3.2% indefinitely. Its worst peak-to-trough loss was 48%, and the longest a new investment spent below water was under 14 years.
Swensen Portfolio Performance
| # | Metric | What it measures |
|---|---|---|
| 5.9% | Average return | Mean annual return after inflation |
| 4.4% | Baseline real return (15 years) | What 15-year stretches returned in the weaker outcomes |
| 3.8% | Safe withdrawal rate (30 years) | Highest spending rate that lasted 30 years in the worst case |
| 3.2% | Long-term withdrawal rate | The SWR floor over very long retirements |
| 48% | Deepest drawdown | Worst peak-to-trough loss after inflation |
| 14 years | Longest drawdown | Longest a new investment stayed below what you put in |
| 14.0% | Volatility (standard deviation) | Year-to-year variation in returns |
Stats for all home countries
Summary Stats by Home Country
| Home country | Average | Baseline | SWR | LTWR | Deepest | Longest | Volatility |
|---|---|---|---|---|---|---|---|
| Australia (aus) | 5.9% | 4.5% | 3.6% | 3.1% | 51% | 15 years | 12.8% |
| Canada (can) | 6.4% | 4.9% | 4.8% | 4.2% | 36% | 10 years | 10.4% |
| France (fra) | 6.8% | 4.8% | 4.4% | 3.9% | 41% | 14 years | 14.4% |
| Germany (deu) | 6.5% | 5.3% | 4.7% | 4.1% | 34% | 11 years | 13.8% |
| Italy (ita) | 6.1% | 3.3% | 3.4% | 2.9% | 47% | 15 years | 15.6% |
| Japan (jpn) | 6.3% | 3.9% | 3.9% | 3.2% | 48% | 12 years | 13.9% |
| Netherlands (nld) | 6.8% | 4.5% | 4.5% | 4.0% | 43% | 13 years | 14.4% |
| Spain (esp) | 5.7% | 3.1% | 2.9% | 2.4% | 62% | 19 years | 15.2% |
| Sweden (swe) | 8.1% | 6.1% | 4.8% | 4.4% | 30% | 12 years | 14.9% |
| Switzerland (che) | 5.9% | 4.4% | 3.8% | 3.2% | 48% | 14 years | 14.0% |
| United Kingdom (gbr) | 6.1% | 4.5% | 4.4% | 3.8% | 52% | 13 years | 13.3% |
| United States (usa) | 6.3% | 4.9% | 4.7% | 4.1% | 37% | 11 years | 11.4% |
To see this portfolio from a specific home country’s perspective, link readers to this page with ?home=COUNTRY added to the URL, using the codes shown in parentheses in the table above (e.g. ?home=aus). The portfolio itself is fixed by the page, so ?pk= has no effect here. More in the Guide for AI Assistants.
Charts
Different ways to visualize the Swensen Portfolio
Comparisons
How the Swensen Portfolio compares to other options
Alternatives
Portfolios with a similar structure or design intent
Ivy Portfolio — Another portfolio directly inspired by college endowments
Pinwheel Portfolio — Similar structure with a focus on real assets
7Twelve Portfolio — Same percentage of stocks and domestic bonds with fewer real assets
Articles
Insights that mention the Swensen Portfolio
Discussion
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