Bill Schultheis Coffee House Portfolio
The Coffee House Portfolio is an investment strategy developed by Bill Schultheis, a financial advisor and author of "The Coffeehouse Investor." It is designed to be a simple, low-cost, diversified portfolio that individual investors can quickly implement.
The Coffee House Portfolio comprises a mix of three index funds: a domestic stock index fund, an international stock index fund, and a bond index fund. The specific asset classes and investments within each category can vary, but the overall allocation is meant to be relatively stable over time. In addition, the portfolio is designed to be globally diversified and to balance growth and income.
One of the fundamental principles of the Coffee House Portfolio is the idea of "passive investing," which involves using index funds to track the performance of a broad market or market segment rather than trying to beat the market through active stock picking or market timing. The goal is to maximize returns while minimizing costs and complexity to produce consistent, long-term results.
Asset Allocation
Performance
Performance Chart
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The earliest data available for this chart is Sep 9, 2010, corresponding to the inception date of VOO
Returns By Period
As of May 15, 2025, the Bill Schultheis Coffee House Portfolio returned 1.43% Year-To-Date and 5.91% of annualized return in the last 10 years.
| YTD | 1M | 6M | 1Y | 5Y* | 10Y* | |
|---|---|---|---|---|---|---|
^GSPC S&P 500 | 0.19% | 9.00% | -1.55% | 12.31% | 15.59% | 10.78% |
| Bill Schultheis Coffee House Portfolio | 1.43% | 4.27% | -0.88% | 6.68% | 8.37% | 5.91% |
| Portfolio components: | ||||||
VOO Vanguard S&P 500 ETF | 0.59% | 9.01% | -0.97% | 13.78% | 17.33% | 12.75% |
BND Vanguard Total Bond Market ETF | 1.46% | -0.22% | 1.30% | 4.36% | -1.08% | 1.38% |
VTV Vanguard Value ETF | 0.68% | 3.35% | -3.69% | 7.11% | 15.37% | 9.80% |
VNQ Vanguard Real Estate ETF | -0.66% | 2.61% | -5.55% | 8.85% | 9.07% | 4.93% |
VEA Vanguard FTSE Developed Markets ETF | 13.05% | 7.66% | 11.68% | 9.53% | 12.46% | 5.54% |
VB Vanguard Small-Cap ETF | -3.19% | 11.29% | -7.34% | 4.42% | 14.28% | 8.21% |
VBR Vanguard Small-Cap Value ETF | -2.67% | 10.43% | -7.81% | 3.01% | 18.17% | 7.98% |
Monthly Returns
The table below presents the monthly returns of Bill Schultheis Coffee House Portfolio, with color gradation from worst to best to easily spot seasonal factors. Returns are adjusted for dividends.
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | Total | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2.31% | 0.54% | -2.17% | -0.73% | 1.53% | 1.43% | |||||||
| 2024 | -0.94% | 1.75% | 2.78% | -4.14% | 3.20% | 0.37% | 4.21% | 1.93% | 1.69% | -2.23% | 4.02% | -4.33% | 8.09% |
| 2023 | 6.10% | -3.04% | 0.47% | 0.65% | -2.14% | 3.99% | 2.19% | -2.13% | -3.94% | -2.86% | 7.25% | 5.93% | 12.23% |
| 2022 | -3.91% | -1.23% | 0.56% | -5.48% | 0.47% | -5.86% | 5.80% | -3.53% | -7.63% | 4.65% | 5.53% | -3.19% | -14.00% |
| 2021 | -0.19% | 2.27% | 2.23% | 3.10% | 1.09% | 0.68% | 0.99% | 1.18% | -2.76% | 3.24% | -1.72% | 3.22% | 13.95% |
| 2020 | -0.18% | -4.37% | -10.91% | 7.80% | 3.09% | 1.42% | 2.97% | 2.20% | -1.78% | -0.78% | 8.61% | 3.18% | 10.17% |
| 2019 | 6.16% | 1.83% | 1.17% | 1.75% | -2.66% | 3.98% | 0.45% | -0.12% | 1.32% | 1.31% | 1.37% | 1.49% | 19.34% |
| 2018 | 1.04% | -3.39% | 0.27% | 0.02% | 1.77% | 0.45% | 1.53% | 1.56% | -0.60% | -4.59% | 1.73% | -4.53% | -4.94% |
| 2017 | 0.87% | 1.88% | -0.12% | 0.79% | 0.35% | 1.00% | 1.16% | 0.06% | 1.48% | 0.72% | 1.60% | 0.77% | 11.07% |
| 2016 | -2.76% | 0.23% | 5.06% | 0.73% | 0.80% | 1.48% | 2.71% | -0.24% | 0.04% | -2.18% | 1.50% | 1.85% | 9.37% |
| 2015 | 0.48% | 1.84% | 0.26% | -0.44% | 0.35% | -1.84% | 1.27% | -3.73% | -0.99% | 4.13% | 0.13% | -1.32% | -0.08% |
| 2014 | -0.69% | 3.11% | 0.41% | 0.60% | 1.50% | 1.58% | -1.58% | 2.53% | -2.60% | 2.60% | 1.28% | 0.20% | 9.13% |
Expense Ratio
Bill Schultheis Coffee House Portfolio has an expense ratio of 0.05%, which is considered low. Below, you can find the expense ratios of the portfolio's funds side by side and easily compare their relative costs.
Risk-Adjusted Performance
Risk-Adjusted Performance Rank
The current rank of Bill Schultheis Coffee House Portfolio is 31, indicating average performance compared to other portfolios on our website. Here’s a breakdown of how it compares using common performance measures.
Risk-Adjusted Performance Indicators
This table presents a comparison of risk-adjusted performance metrics for positions. Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.
| Sharpe ratio | Sortino ratio | Omega ratio | Calmar ratio | Martin ratio | |
|---|---|---|---|---|---|
VOO Vanguard S&P 500 ETF | 0.72 | 1.15 | 1.17 | 0.77 | 2.94 |
BND Vanguard Total Bond Market ETF | 0.83 | 1.31 | 1.15 | 0.38 | 2.29 |
VTV Vanguard Value ETF | 0.46 | 0.77 | 1.11 | 0.51 | 1.86 |
VNQ Vanguard Real Estate ETF | 0.50 | 0.87 | 1.11 | 0.42 | 1.78 |
VEA Vanguard FTSE Developed Markets ETF | 0.56 | 0.96 | 1.13 | 0.76 | 2.31 |
VB Vanguard Small-Cap ETF | 0.20 | 0.52 | 1.07 | 0.22 | 0.69 |
VBR Vanguard Small-Cap Value ETF | 0.14 | 0.43 | 1.06 | 0.17 | 0.51 |
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Dividends
Dividend yield
Bill Schultheis Coffee House Portfolio provided a 2.94% dividend yield over the last twelve months.
| TTM | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2.94% | 2.87% | 2.70% | 2.50% | 2.00% | 2.18% | 2.51% | 2.81% | 2.44% | 2.56% | 2.53% | 2.57% |
| Portfolio components: | ||||||||||||
VOO Vanguard S&P 500 ETF | 1.29% | 1.24% | 1.46% | 1.69% | 1.25% | 1.54% | 1.88% | 2.06% | 1.78% | 2.02% | 2.10% | 1.85% |
BND Vanguard Total Bond Market ETF | 3.78% | 3.67% | 3.09% | 2.60% | 1.97% | 2.22% | 2.72% | 2.81% | 2.54% | 2.51% | 2.57% | 2.79% |
VTV Vanguard Value ETF | 2.31% | 2.31% | 2.46% | 2.52% | 2.15% | 2.56% | 2.50% | 2.73% | 2.29% | 2.44% | 2.60% | 2.22% |
VNQ Vanguard Real Estate ETF | 4.15% | 3.85% | 3.95% | 3.91% | 2.56% | 3.93% | 3.39% | 4.74% | 4.23% | 4.82% | 3.92% | 3.60% |
VEA Vanguard FTSE Developed Markets ETF | 2.90% | 3.35% | 3.15% | 2.91% | 3.16% | 2.04% | 3.04% | 3.35% | 2.77% | 3.05% | 2.92% | 3.68% |
VB Vanguard Small-Cap ETF | 1.46% | 1.30% | 1.55% | 1.59% | 1.24% | 1.14% | 1.39% | 1.67% | 1.35% | 1.50% | 1.48% | 1.43% |
VBR Vanguard Small-Cap Value ETF | 2.20% | 1.98% | 2.12% | 2.03% | 1.75% | 1.68% | 2.06% | 2.35% | 1.79% | 1.77% | 1.99% | 1.77% |
Drawdowns
Drawdowns Chart
The Drawdowns chart displays portfolio losses from any high point along the way. Drawdowns are calculated considering price movements and all distributions paid, if any.
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Worst Drawdowns
The table below displays the maximum drawdowns of the Bill Schultheis Coffee House Portfolio. A maximum drawdown is a measure of risk, indicating the largest reduction in portfolio value due to a series of losing trades.
The maximum drawdown for the Bill Schultheis Coffee House Portfolio was 24.01%, occurring on Mar 23, 2020. Recovery took 141 trading sessions.
The current Bill Schultheis Coffee House Portfolio drawdown is 2.97%.
Depth | Start | To Bottom | Bottom | To Recover | End | Total |
|---|---|---|---|---|---|---|
| -24.01% | Feb 21, 2020 | 22 | Mar 23, 2020 | 141 | Oct 12, 2020 | 163 |
| -20.2% | Nov 8, 2021 | 236 | Oct 14, 2022 | 434 | Jul 10, 2024 | 670 |
| -12.76% | Jul 8, 2011 | 61 | Oct 3, 2011 | 83 | Feb 1, 2012 | 144 |
| -11.01% | Aug 30, 2018 | 80 | Dec 24, 2018 | 56 | Mar 18, 2019 | 136 |
| -10.8% | Dec 2, 2024 | 87 | Apr 8, 2025 | — | — | — |
Volatility
Volatility Chart
The chart below shows the rolling one-month volatility.
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Diversification
Diversification Metrics
Number of Effective Assets
The portfolio contains 7 assets, with an effective number of assets of 4.55, reflecting the diversification based on asset allocation. This number of effective assets suggests a highly concentrated portfolio, where a few assets dominate the allocation, potentially increasing the portfolio's risk due to lack of diversification.
Asset Correlations Table
| ^GSPC | BND | VNQ | VEA | VBR | VB | VTV | VOO | Portfolio | |
|---|---|---|---|---|---|---|---|---|---|
| ^GSPC | 1.00 | -0.10 | 0.63 | 0.82 | 0.84 | 0.88 | 0.90 | 1.00 | 0.90 |
| BND | -0.10 | 1.00 | 0.14 | -0.06 | -0.13 | -0.10 | -0.14 | -0.10 | 0.09 |
| VNQ | 0.63 | 0.14 | 1.00 | 0.57 | 0.67 | 0.66 | 0.65 | 0.63 | 0.79 |
| VEA | 0.82 | -0.06 | 0.57 | 1.00 | 0.76 | 0.77 | 0.80 | 0.82 | 0.85 |
| VBR | 0.84 | -0.13 | 0.67 | 0.76 | 1.00 | 0.97 | 0.89 | 0.84 | 0.92 |
| VB | 0.88 | -0.10 | 0.66 | 0.77 | 0.97 | 1.00 | 0.86 | 0.88 | 0.93 |
| VTV | 0.90 | -0.14 | 0.65 | 0.80 | 0.89 | 0.86 | 1.00 | 0.90 | 0.90 |
| VOO | 1.00 | -0.10 | 0.63 | 0.82 | 0.84 | 0.88 | 0.90 | 1.00 | 0.90 |
| Portfolio | 0.90 | 0.09 | 0.79 | 0.85 | 0.92 | 0.93 | 0.90 | 0.90 | 1.00 |
AI Insight on Diversification
The portfolio is moderately diversified with a notable concentration in equity positions that exhibit high correlations among themselves. The correlation matrix reveals that the equity ETFs—VOO (S&P 500), VTV (value stocks), VB (small-cap stocks), and VBR (small-cap value stocks)—are all strongly correlated with each other, with correlations ranging from 0.84 to 0.97. This high degree of correlation suggests that these positions tend to move in tandem, which limits the diversification benefits within the equity portion of the portfolio.
VNQ (real estate) and VEA (developed international equities) show moderate correlations with the core U.S. equity ETFs (VOO, VTV, VB, VBR), generally in the 0.57 to 0.85 range. While these are somewhat less correlated than the core U.S. equities, their correlations are still relatively high, indicating that they may not provide substantial diversification away from U.S. equity market movements but do add some geographic and sectoral variation.
BND (U.S. bonds) stands out as the least correlated asset relative to the equity ETFs, with correlations mostly negative or near zero (ranging from -0.14 to 0.14). This low or negative correlation with equities is a key diversification strength, as bonds typically behave differently from stocks, especially during market downturns.
The portfolio’s overall correlation with individual positions is highest with the equity ETFs (0.9 and above) and lowest with BND (0.09). This suggests that the portfolio’s performance is largely driven by the equity holdings, with bonds playing a smaller but important role in diversification.
Given the dominance of highly correlated equity positions, the portfolio leans toward concentration within equities, particularly U.S. stocks, with less balance from other asset classes. The presence of BND provides some offset, but the portfolio could be considered moderately concentrated due to the strong equity correlations and relatively limited exposure to low-correlation assets.
In summary, while the portfolio includes a mix of asset classes, the high correlations among equity positions reduce diversification benefits, making it more sensitive to equity market movements. The bond allocation offers valuable diversification, but the portfolio overall is more concentrated in equities than fully diversified across uncorrelated assets.