Beating The Couch Potato: 20 Portfolios That Outperform Scott Burns' Simple Asset Allocation

Published: September 1, 2016

Summary

 

Scott Burns's Couch Potato Portfolio was devised in 1991 as a super-simple way to invest.

 

New brokerage trading technologies allow investors to create more sophisticated portfolios and rebalance easily. So we evaluate if the Couch Potato Portfolio is still a good approach.

 

On a risk-adjusted basis, the Couch Potato Portfolio has performed well against other static portfolios.

 

However, several tactical ETF portfolios offer superior returns with less risk.

 

In 1991, Dallas Morning News columnist Scott Burns proposed a dead-simple portfolio: invest 50% in the U.S. Total Stock Market and 50% in a U.S. Total Bond Market fund or Treasury Inflation-Protected Securities. This simple portfolio has moved steadily forward with a 6.6% annual return over the past 10 years.


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