Diversify Smarter with Swensen’s Model

Strategy Overview

The Swensen-Inspired portfolio applies David Swensen’s endowment principles to your investing journey. It allocates 30% to the Vanguard Total Stock Market ETF (VTI, 0.03% expense ratio), 15% to the Vanguard FTSE Developed Markets ETF (VEA, 0.05%), 5% to the Vanguard FTSE Emerging Markets ETF (VWO, 0.08%), 15% to the Vanguard Intermediate-Term Treasury ETF (VGIT, 0.04%), 15% to the iShares TIPS Bond ETF (TIP, 0.19%), and 20% to the Vanguard Real Estate ETF (VNQ, 0.12%). This deliberate mix balances growth, inflation protection, and real assets—designed for resilience and clarity.

Brief history context

David Frederik Swensen reshaped institutional investing by emphasizing diversification beyond U.S. equities and fixed income alone. Quantlake translates this philosophy into a disciplined, accessible portfolio that removes complexity while preserving long-term rigor.

Rebalancing

Quarterly rebalancing keeps your allocation aligned, capturing rebalancing benefits and removing emotion from portfolio management. The last rebalance occurred on June 30, 2025; the next is due September 30, 2025.

Performance Snapshot (as of July 9, 2025)

CAGR since November 2009: 8.2%

Max drawdown: -26%

Sharpe ratio: 0.6

10-year return: 101.9%

5-year return: 49%

3-year return: 31.9%

1-year return: 11.6%

YTD return: 7.5%

Quantlake Risk Level

This portfolio sits at Risk Level 4 on Quantlake’s 1–7 scale—a moderate risk profile, suited for investors willing and able to tolerate some volatility.

Worth noting: risk tolerance (your comfort with volatility) and risk capacity (your financial ability to endure losses) are distinct. Quantlake helps you understand both in less than 10 minutes, providing clarity and ensuring alignment between your mindset and financial position—a foundation for staying invested through cycles.

Why This Portfolio?

What stands out is its structural balance: real estate and TIPS anchor purchasing power, while intermediate Treasuries temper volatility without eliminating return potential. Another point investors often overlook—the equity allocation deliberately reduces overexposure to U.S. equities by including developed and emerging markets, offering better diversification than a typical U.S.-centric portfolio.

Final Note

Quantlake’s Swensen-Inspired portfolio embodies patient, systematic investing: diversified, disciplined, and designed to help you stay invested through cycles. It reflects our belief that long-term wealth creation requires a strategy that tempers emotions, reduces noise, and privileges clarity over complexity. Investors can easily track this portfolio by logging in to the Quantlake site.

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Happy Long-Term Investing!

Romain Gandon, CEO & Founder of Quantlake
🔗 LinkedIn

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‍Disclaimer: Past performance is no guarantee of future results. Results are simulated, actual results may differ based on many factors such as liquidity, transaction costs, tax. Always use your best judgment and exercice caution when making financial decisions. You should read our T&C for more information.

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