The “mostly stocks” Retirement Portfolio

By Dale Roberts, cutthecrapinvesting

Special to the Financial Independence Hub

It was a long time in the making, but I recently finished and posted the stock portfolio for retirees, on Seeking Alpha. It uses an all-weather portfolio approach but only puts stocks to work. Stocks are arranged by sector to perform in certain economic environments. Stocks and REITs will have to step up to do the work of bonds, gold, cash and commodities. We’re building the retirement stock portfolio on the Sunday Reads.

Here’s the post – Stocks for the retirement portfolio. That is a U.S. version. I will also post the Canadian stock portfolio (ideas for consideration)  on Cut The Crap Investing.

Defense wins ball games

The key is a core defensive stance: for market corrections, recessions and deflation. For those who are not able to access Seeking Alpha, here’s the portfolio.

As always, this is not advice. This is an idea and strategy for consideration.

Defensives @ 60%

Utilities – 10%

NextEra Energy, Duke Energy Corp, The Southern Co, Dominion Energy, Alliant Energy, Oneok, WEC Energy.

Pipelines – 10%

Enbridge, TC Energy, Enterprise Partners, Energy Transfer, Oneok.

Telecom – 10%

AT&T, Verizon, Comcast, T-Mobile, Bell Canada, Telus.

Telco REITs – American Tower, Crown Castle.

Consumer Staples – 10%

Colgate-Palmolive, Procter & Gamble, Walmart, Pepsi, Kraft Heinz, Tyson Foods, Kellogg, Kroger, Hormel Foods, Albertsons Companies.

Healthcare – 10%

Johnson & Johnson, Abbott Labs, Medtronic, Stryker, CVS Health, McKesson Corporation, United Health, Merck, Becton Dickinson, Cigna Corp.

Canadian banks – 10%

RBC, TD Bank, Scotiabank, Bank of Montreal.

Growth assets – 20%

Consumer discretionary, retailers, technology, healthcare, financials, industrials and energy stocks.

Apple, Microsoft, Qualcomm, Texas Instruments, Nike, BlackRock, Alphabet, Lowe’s, Amazon, TJX Companies, McDonald’s, Tesla, Visa, Mastercard, Raytheon, Waste Management, Berkshire Hathaway, Broadcom.

Inflation protection – 20%

REITs 10%

Agree Realty Corporation, Realty Income, Essential Properties, Regency Centres Corporation, Stag Industrial, Medical Properties Trust, Store Capital Corporation, Global Self Storage and EPR Properties.

Oil and gas / commodities stocks 10%

Canadian Natural Resources, Imperial Oil, ConocoPhillips, Exxon Mobil, Chevron, EOG Resources, Occidental Petroleum, Devon Energy.


Nutrien, The Mosaic Company.

Precious and other metals

Tech Resources, BHP Group, Rio Tinto

All said, I am still a fan of some cash and commodities and bonds. This was offered in the post …

The hybrid approach might then include:

  • 5% cash
  • 5% bonds
  • 5% commodities
  • 85% retirement stocks

More Sunday Reads

A Harvest ETF post on the Findependence Hub echoes the strength of the healthcare sector. The sector offers a unique combination of defense and growth.

Lance Roberts (no relation) offers a very interesting post on the task of today’s Federal Reserve in comparison to the Fed chief who killed the stagflation in the late 70’s and early 80s – Paul Volcker. Stock market cheerleaders (not Lance) have been suggesting that any bear market could be reversed or corrected in a matter of months. Just as occured in the early 80’s. Lance sees a bit of cherry picking in looking at that event.

When an analyst “cherry picks” a random point in market history to base their investment thesis, one should take such with a “heavy dose of salt.” The reason is that “this time is different.” Every period is different due to the differences in the makeup of the economy, markets, consumption, production, debt, and a litany of other domestic and global factors.

To say 2022 is like 1982 is a dangerous statement, particularly when 1982 is taken entirely out of the context of what preceded it.

Lance Roberts

I often suggest that we don’t know if the current Fed will actually get serious about killing inflation – good and dead the first time. Volcker tightened the money supply and pushed the federal-funds rate above 19%. We don’t know if Jermone Powell will turn out to be the viscious rate hiking Volker, or his predecessor Arthur Burns who let stagflation get out of control a few times.

The stock markets, what a follower

And looks it’s magic. Here is a wonderful post (including a simple disappearing ball magic trick video) that explains how the narrative always follows the price action in the markets. Explaining the recent bear market, and then the recent market recovery:

The prevailing narratives 2-3 months ago in the stock market were as follows:

  • The stock market is pricing in an imminent recession or we’re already in one.
  • The Fed has lost control of inflation.
  • Without the Fed put there’s nothing stopping the stock market from falling 40-50%.

These narratives all made sense at the time because the stock market was down almost 25%. When prices are down it’s always going to be easier to talk yourself into every bearish argument.

Markets changed their mind and your mindset

Now that the market has rallied 15%, here are some new narratives gaining steam:

  • It’s possible the Fed could orchestrate a soft landing.
  • A recession is no longer guaranteed.
  • Inflation is improving.
  • Well even if we do go into a mild recession, the Fed will probably step in and lower rates.

All it took for a change in sentiment was higher prices.

Muddling through stagflation

On Mauldin Economics, we’re muddling through the current stagflation. Guest author David Bahnsen also touches on the advantageous valuation of dividend stocks in the U.S. and adds …

Am I cherry-picking with McDonald’s? Not exactly. A slew of familiar names from Johnson & Johnson to Walmart to Coca-Cola are similar. My point is that for those accumulating assets for the future, a properly constructed portfolio of dividend-growing companies has created a significant total return, with generally lower volatility than the market, and that those needing to withdraw from their portfolios can do so in a straight line up, unimpeded by the inconvenience (and mathematical danger) of withdrawing from a declining asset.

‘Ironically’ those are all stocks mentioned in the stock portfolio for retirees post. 🙂

John Mauldin is off getting some medical tests taken care of. I wish John the best …

I am not getting great news for my first few days at the Cleveland Clinic. Difficult lifestyle changes are in front of me. Sigh. But we do what we must.

You can ask Mark anything about inflation on the Weekend Reads at My Own Advisor.

Here’s is the July dividend update on Tawcan. That is some impressive growth. Bob is a prolific saver and investor.

While tracking the dividends can help reinforce good investor behaviour we should always consider the cost of our Canadian home bias. It is very beneficial to separate the accumulation and decumulation (retirement) stages. More money buys or creates more retirement income.

Here is the week in review on Dividend Hawk. The “review” is some nice vacation shots, enjoy your break Hawk.

On Banker on Fire, investors are born to be bad. Yes we have to fight our own internal human wiring to turn ourselves into good and ‘sane’ investors.

And these are the goods on The Irrelevant Investor. A nice roundup from the serious adults in the personal finance room.

I will leave you with a quote from the Mauldin report post …

I don’t know what Jay Powell is doing for the next 10 years. But you know what? I feel pretty good about what Ronald McDonald is going to do.

Thanks for reading, we’ll see you in the comment section. You can follow this blog by entering your email address in the Subscribe area. It’s free.

You should also follow me on Twitter.

Here’s the Tweet of the week. Speaking of creating more money for retirement …

Be sure to check out my posts on Seeking Alpha. Here for example is my recent piece on Retirement and the All-Weather portfolio.

Dale Roberts is the owner operator of the Cut The Crap Investing blog,  and a columnist for MoneySense. This blog originally appeared on Cut the Crap Investing on Aug. 21, 2022 and is republished on the Hub with permission. 

One thought on “The “mostly stocks” Retirement Portfolio

  1. On what basis does Devon Energy make your list of recommendations? This company’s management has destroyed more capital in the last couple of decades than any other remaining O&G producer. Don’t mistake its’ recent run up due to commodity price surge for good investment decisions by company management.

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