Seeking Alpha

Building Your Own ETF Portfolio: A Case Study (Podcast)

About: SPDR Bloomberg Barclays 1-3 Month T-Bill ETF (BIL), CORP, GBIL, LQD, QLTA, QQQ, STIP, USIG, VXF, Includes: BAR, CIBR, FIW, IEMG, KWEB, NACP, SHE, SPLV, VEA, VLUE, VNQ
by: Let's Talk ETFs

One of the best things about exchange-traded funds is how compatible they are with a do-it-yourself ethos.

Unlike with mutual funds, ETFs are fully transparent and easy to research, meaning investors know exactly what they are getting with each fund they add to their portfolio.

On the latest Let's Talk ETFs, host Jonathan Liss takes a break from the usual expert interview format to help his friend build her own ETF portfolio.

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By Jonathan Liss

Perhaps more than anywhere on earth, Americans are known for their do-it-yourself ethos. The popularization of the phrase itself likely originates with the home improvement market; the massive success of companies like Home Depot (HD) and Lowe's (LOW) is testament to this.

A similar ethos has existed in the investing space for many decades now. Exchange-traded funds, with their low expense ratios, commission-free trades, tax efficiency, full transparency of what they hold, and the ease with which they can be researched, are the perfect vehicle for fiercely independent do-it-yourselfers. As Vanguard founder Jack Bogle famously quipped, "In investing, you get what you don't pay for." Any money you don't pay in fund expenses, taxes or advisor fees ultimately is money that can go to work for you, helping you to achieve your financial goals.

In this episode of Let's Talk ETFs, I assist a friend with no interest in paying a financial advisor in her task of constructing her own ETF portfolio. Her back-story is as follows: she and her husband came into roughly $350,000 in inheritance. They decided to split the money into 2 parts with $90,000 being allocated to "safe" assets should they decide to do an addition on their house in 4 years' time or need some money for a rainy day. The remaining $260,000 is money they don't plan on touching until retirement, which at age 36 is at least 30 years away.

She decided to adopt a "core and satellite" strategy, placing the lion's share of her investments into 5 core equity and 3 core fixed income ETFs. She then added in some REIT and gold for their non-correlation to stocks and bonds. Finally, she decided to have a bit of fun with the remaining cash, spreading her money between several thematic and values-driven strategies she is passionate about.

The research process involved mainly a few key tools on Seeking Alpha as well as visits to each of the issuer's fund websites. We made regular use of Seeking Alpha's ETF Screener - a product I helped build. During the podcast, I reference exactly which asset classes and filters I am applying so that listeners can follow along. We also made extensive use of Seeking Alpha's greatly improved ETF quote pages - something that has been made possible by the introduction of Seeking Alpha Premium. In particular, we made regular use of the Holdings and expanded (for Premium subscribers) Peers/Key Stats Comparison tabs in our research process (example of LQD included here):

The final portfolio ended up as follows:



Asset Class

Allocation %


Invesco QQQ ETF

Equities – U.S. Large Cap



Vanguard Extended Market Index ETF

Equities – U.S. Mid/Small Cap



iShares Edge MSCI USA Value Factor ETF

Equities - Value



Vanguard FTSE Developed Markets ETF

Equities – Developed Markets



iShares Core MSCI Emerging Markets ETF

Equities – Emerging Markets



Goldman Sachs Treasury Access 0-1 Year ETF

Bonds – Treasuries



iShares 0-5 Year TIPS Bond ETF

Bonds – Treasuries



iShares Aaa – A Rated Corporate Bond ETF

Bonds – Corporate Investment Grade



Vanguard Real Estate ETF




GraniteShares Gold Trust




KraneShares CSI China Internet ETF

Equities - Thematic



First Trust Nasdaq CEA Cybersecurity ETF

Equities - Thematic



First Trust Water ETF

Equities - Thematic



SPDR SSGA Gender Diversity Index ETF

Equities - ESG



Impact Shares NAACP Minority Empowerment ETF

Equities – ESG


It's important to note that nothing said or written here should be interpreted as investment advice for any particular investor. Each of us has our own life circumstances, risk tolerance and financial goals. I hope you enjoy listening to this episode as much as I enjoyed making it!

Show Notes

  • 0:55 - A note on the research tools used during this show
  • 2:45 - My friend's backstory: Investing goals/objectives
  • 4:45 - Portfolio rundown: Core (QQQ) (VEA) (IEMG) (VXF) and satellite (CIBR) (FIW) (KWEB) (NACP), (SHE) (VNQ) (BAR) (SPLV) holdings
  • 9:00 - Using limit vs. market orders
  • 11:30 - Finding the right risk balance between the equity and fixed income parts of the portfolio
  • 16:00 - Utilizing commission-free trades to split investible cash across positions proportionally
  • 17:30 - Fixed income objectives: Preserving capital vs. reaching for yield
  • 19:00 - Using the Seeking Alpha ETF Screener to locate ultra-short duration U.S. Treasury funds (BIL) (GBIL)
  • 21:00 - Fixed income building block #2: TIPS (STIP)
  • 21:45 - Fixed income building block #3: Adding yield without compromising underlying quality - Investment Grade Rated Corporates (LQD) (USIG) (CORP)
  • 25:15 - Contemplating adding more physical gold (BAR)
  • 26:15 - Investment Grade Rated Corporate Bond ETFs, continued (QLTA)
  • 27:45 - Finding the right mix between the four fixed income ETFs we've selected: BIL, GBIL, STIP and QLTA
  • 32:45 - Addendum: Spreading out the equity exposure to include more "value" (VLUE)

Disclosure: I am/we are long QQQ, VXF, VLUE, VEA, IEMG, GBIL, STIP, QLTA, BAR, VNQ, NACP, SHE, FIW, CIBR, KWEB. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: Jonathan Liss is long QQQ, VNQ, FIW and CIBR.