Coward’s Portfolio by Bill Bernstein: Allocations, Performance, and Returns Analysis
The Bernstein Coward’s Portfolio by Bill Bernstein aims to diversify investments as widely as possible across asset classes (bonds & stocks), countries, company size, and valuation.
Bill Bernstein Coward’s Portfolio strategy can be implemented with only 9 ETFs, of which 60% are stock ETFs and 40% are bond ETFs. You do not need to pick individual stocks and bonds. In other words, this is close to a passive portfolio that only requires some rebalancing once in a while.
According to our backtests spanning 16 years, Bill Bernstein Coward’s Portfolio got the following performance metrics:
- Compound annual return (CAR): 5.14%;
- Standard deviation: 14.34%;
- Maximum drawdown (MDD): –36.20%;
- Sharpe ratio (with a risk-free rate of 3%): 0.15;
- CAR/MDD ratio: 0.14.
(This article is just one of hundreds we have written about different investment strategies.)
Let’s explain and backtest the portfolio in detail:
Who Is Bill Bernstein – personal bio
Bill Bernstein is an American author, financial theorist, and retired neurologist. He is best known for his work on asset allocation and portfolio construction, and he has written several influential books on the subject, including “The Intelligent Asset Allocator” and “The Four Pillars of Investing”.
Bernstein has also written extensively on financial history, including “A Splendid Exchange: How Trade Shaped the World” and “Masters of the Word: How Media Shaped History”.
He co-founded the investment advisory firm Efficient Frontier Advisors and has served as a consultant to several financial institutions.
Bernstein’s work has earned him a reputation as a leading expert in the field of investment theory and portfolio construction. His approach emphasizes the importance of diversification, risk management, and a long-term perspective.
He has been a strong advocate for using low-cost index funds and has been critical of the financial services industry for its focus on high fees and active management.
What Is The Bernstein Coward’s Portfolio – facts and figures
The Bernstein Coward’s Portfolio is a broadly diversified portfolio that consists of two main asset classes:
- Stocks that make up 60% of the portfolio and are diversified by stock types (growth, value, and both), capitalization (small and large caps), market development types (emerging and developed markets), and geographic regions (European, Pacific, and domestic regions). Real estate stocks are also included;
- Corporate bonds make up the remaining 40% of the portfolio.
The asset allocation of The Bernstein Coward’s Portfolio is as follows:
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