1. Simple Asset Allocation Example (Stocks/Bonds):
| Asset | Allocation Percentage |
| Global Equities | 75 % |
|
U.S. Stock Market |
55 % |
| International Stocks |
20 % |
| Global Fixed Income | 25% |
|
U.S. Bonds |
20 % |
| International Bonds |
5 % |
2. More Detailed Asset Allocation Example (Stocks/Bonds):
| Asset | Allocation Percentage |
| U.S. Stocks* | 60 % |
|
S&P 500 (Large Cap) |
40% |
|
Mid-Cap |
10% |
| Small Cap |
10% |
| International Stocks | 20 % |
|
Developed Market Stocks |
13% |
| Emerging Market Stocks |
7% |
| Fixed Income | 20% |
|
U.S. Bonds |
12% |
|
International Bonds |
5% |
| High-Yield (Junk) Bonds |
3% |
*This example is overweight mid-cap and small-cap, and underweight S&P 500, since the S&P 500 makes up approximately 80% of the U.S. total stock market capitalization.
3. Example Adding Gold/Commodities:
| Asset | Allocation Percentage |
| U.S. Stocks** | 60 % |
|
S&P 500 (Large Cap) |
47% |
|
Mid-Cap |
9% |
| Small Cap |
4% |
| International Stocks | 18 % |
|
Developed Market Stocks |
12% |
| Emerging Market Stocks |
6% |
| Fixed Income | 15% |
|
U.S. Bonds |
10 % |
|
International Bonds |
3% |
| High-Yield (Junk) Bonds |
2% |
| Gold/Commodities | 7% |
**This allocation approach for U.S. stocks is closer to tracking the total U.S. stock market index than the second example above. This approach allows for rebalancing between large, mid-, and small-cap stocks, but one could pursue a similar approach by purchasing a total U.S. stock market index or ETF, if there is no desire or need to rebalance based on U.S. market cap size.
4. Example Adding Real Estate, through Real Estate Investment Trusts (REIT) ETFs or Index Funds:
| Asset | Allocation Percentage |
| U.S. Stocks | 60 % |
|
S&P 500 (Large Cap) |
40% |
|
Mid-Cap |
10% |
|
Small Cap |
10% |
| International Stocks | 14 % |
|
Developed Market Stocks |
8% |
|
Emerging Market Stocks |
6% |
| Fixed Income | 12% |
|
U.S. Bonds |
7% |
|
International Bonds |
3% |
|
High-Yield (Junk) Bonds |
2% |
| Gold/Commodities | 7% |
| Real Estate | 7% |
| U.S. Real Estate (REIT EFT or Index Fund) |
5% |
| International Real Estate |
2% |
5. More aggressive asset allocation example: This example increases allocation to equities, including small-cap; emerging market stocks; and high-yield bonds.
| Asset | Allocation Percentage |
| U.S. Stocks | 65% |
|
S&P 500 (Large Cap) |
40% |
|
Mid-Cap |
10% |
|
Small Cap |
15% |
| International Stocks |
15% |
|
Developed Market Stocks |
5% |
|
Emerging Market Stocks |
10% |
| Fixed Income | 10% |
|
U.S. Bonds |
3% |
|
International Bonds |
2% |
|
High-Yield (Junk) Bonds |
5% |
| Gold/Commodities | 4% |
| Real Estate | 6% |
|
U.S. Real Estate (REIT EFT or Index Fund) |
4% |
| International Real Estate |
2% |
Disclosure: The above examples are overweight U.S. assets based on percentages of the total global markets that U.S. markets represent. The author is a U.S. citizen and admittedly biased toward U.S. equities, fixed income, and real estate. While the U.S. stock market has outperformed other international markets historically, every investor should be aware of the potential (likelihood) of home market bias and the potential benefits of diversifying internationally.
