Q: I am setting up a retirement portfolio. i know that in your view allocations are personal but if you were setting up your retirement portfolio what would be your highest ZUT allocation that you would be comfortable with? what would be your allocation per dividend/conservative non-overlapping ETFs? what would be your top 5-6 ETFs for such a portfolio?
5i Research Answer:
Utilities are typically stable, and ZUT is a decent ETF. That being said, on an annual basis it has still declined in four years of the past 10. We would see 15% as a cap. While we would be fine with an all-ETF portfolio, an investor likely can get by with 5 or 6 for 65% of a portfolio, assuming some diversification. Having some stock exposure can provide additional upside potential and allow some tax planning (selling losers). For a conservative set up we would look at: ZUT, CDZ, XMV, VBAL, VGG, XBB, ZLU