Charles Schwab Conservative Income Portfolio: ETF allocation and returns

Data Source: from January 1985 to May 2024 (~39 years)
Consolidated Returns as of 31 May 2024
Live Update: Jun 25 2024, 02:00PM Eastern Time
Currency: USD
PORTFOLIO • LIVE PERFORMANCE (USD currency)
0.05%
1 Day
Jun 25 2024, 02:00PM Eastern Time
1.05%
Current Month
June 2024

The Charles Schwab Conservative Income Portfolio can be implemented with 6 ETFs. This portfolio has a low risk, suggesting it experiences minor value changes. It is ideal for conservative investors who prioritize capital preservation and prefer stable, predictable returns.

The asset allocation is the following: 5% on the Stock Market, 95% on Fixed Income, 0% on Commodities. In general, bonds are useful for mitigating overall portfolio risk, especially if they are issued by national entities or highly reliable companies. This portfolio has a 95% allocation to bonds, leading to its classification as low risk.

In the last 30 Years, the Charles Schwab Conservative Income Portfolio obtained a 4.45% compound annual return, with a 3.61% standard deviation. It suffered a maximum drawdown of -11.50% that required 29 months to be recovered.

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Asset Allocation and ETFs

The Charles Schwab Conservative Income Portfolio has the following asset allocation:

5% Stocks
95% Fixed Income
0% Commodities

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The Charles Schwab Conservative Income Portfolio can be implemented with the following ETFs:

Weight
(%)
ETF
Ticker
ETF
Currency
ETF Name Investment Themes (Orig.Currency)
5.00
VNQ
USD Vanguard Real Estate Real Estate, U.S. (USD)
40.00
BND
USD Vanguard Total Bond Market Bond, U.S., All-Term (USD)
25.00
BIL
USD SPDR Blmbg Barclays 1-3 Mth T-Bill Bond, U.S., Ultra Short-Term (USD)
18.00
TIP
USD iShares TIPS Bond Bond, U.S., All-Term (USD)
7.00
HYG
USD iShares iBoxx $ High Yield Corporate Bond Bond, U.S., Intermediate-Term (USD)
5.00
BNDX
USD Vanguard Total International Bond Bond, Developed Markets Ex-US, All-Term (USD)

Most of Lazy Portfolios are made of common components (asset classes), very simple and well defined. For a more complete view, find out the most common ETFs you can use to build your portfolio.

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Portfolio and ETF Returns as of May 31, 2024

The Charles Schwab Conservative Income Portfolio guaranteed the following returns.

Returns are calculated in USD, assuming: June 2024 return is calculated on the hypothesis of a newly built portfolio, with the starting asset allocation.
CHARLES SCHWAB CONSERVATIVE INCOME PORTFOLIO
Consolidated returns as of 31 May 2024
Live Update: Jun 25 2024, 02:00PM Eastern Time
Swipe left to see all data
  Chg (%) Return (%) Return (%) as of May 31, 2024
  1 Day Time ET(*) Jun 2024 1M 6M 1Y 5Y 10Y 30Y MAX
(~39Y)
Charles Schwab Conservative Income Portfolio -0.05 1.05 1.44 2.59 3.51 1.22 1.78 4.45 5.64
US Inflation Adjusted return 1.44 0.89 0.25 -2.83 -1.02 1.86 2.76
Components
VNQ
USD Vanguard Real Estate -1.41 02:00PM, Jun 25 2024 0.22 4.56 3.98 8.46 2.88 5.20 8.66 9.07
BND
USD Vanguard Total Bond Market -0.01 01:59PM, Jun 25 2024 1.59 1.68 2.05 1.44 -0.19 1.23 4.30 5.66
BIL
USD SPDR Blmbg Barclays 1-3 Mth T-Bill 0.02 01:59PM, Jun 25 2024 0.36 0.46 2.63 5.37 1.97 1.31 2.28 3.12
TIP
USD iShares TIPS Bond 0.05 01:58PM, Jun 25 2024 1.11 1.78 2.42 1.36 1.58 1.56 5.24 6.66
HYG
USD iShares iBoxx $ High Yield Corporate Bond 0.10 01:59PM, Jun 25 2024 0.80 1.63 5.03 10.58 3.14 3.12 5.63 6.87
BNDX
USD Vanguard Total International Bond 0.02 01:59PM, Jun 25 2024 1.13 0.29 2.05 3.64 -0.19 1.93 4.91 6.54
Returns over 1 year are annualized | Available data source: since Jan 1985
(*) Eastern Time (ET - America/New York)
US Inflation is updated to May 2024. Current inflation (annualized) is 1Y: 3.25% , 5Y: 4.17% , 10Y: 2.83% , 30Y: 2.54%
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In 2023, the Charles Schwab Conservative Income Portfolio granted a 3.92% dividend yield. If you are interested in getting periodic income, please refer to the Charles Schwab Conservative Income Portfolio: Dividend Yield page.

Capital Growth as of May 31, 2024

An investment of 1$, since June 1994, now would be worth 3.69$, with a total return of 268.83% (4.45% annualized).

The Inflation Adjusted Capital now would be 1.74$, with a net total return of 73.69% (1.86% annualized).

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An investment of 1$, since January 1985, now would be worth 8.68$, with a total return of 767.89% (5.64% annualized).

The Inflation Adjusted Capital now would be 2.92$, with a net total return of 192.32% (2.76% annualized).

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Portfolio Metrics as of May 31, 2024

Metrics of Charles Schwab Conservative Income Portfolio, updated as of 31 May 2024, provide a comprehensive overview of the portfolio's performance and risk characteristics.

These metrics include detailed data on returns, volatility, drawdowns and other key performance indicators. By examining them, you can gain insights into how the portfolio has performed over various time periods and understand its risk profile.

Metrics are calculated based on monthly returns, assuming:
CHARLES SCHWAB CONSERVATIVE INCOME PORTFOLIO
Advanced Metrics
Data Source: 1 January 1985 - 31 May 2024 (~39 years)
Swipe left to see all data
Metrics as of May 31, 2024
1M 3M 6M 1Y 3Y 5Y 10Y 20Y 30Y MAX
(~39Y)
Investment Return (%) 1.44 0.49 2.59 3.51 -0.88 1.22 1.78 3.20 4.45 5.64
Infl. Adjusted Return (%)
1.44 -0.20 0.89 0.25 -5.84 -2.83 -1.02 0.60 1.86 2.76
US Inflation (%) 0.01 0.70 1.69 3.25 5.28 4.17 2.83 2.58 2.54 2.80
Returns / Inflation rates over 1 year are annualized.
DRAWDOWN
Inflation Adjusted:
Inflation Adjusted:
1Y 3Y 5Y 10Y 20Y 30Y MAX
Deepest Drawdown Depth (%) -3.07 -11.50 -11.50 -11.50 -11.50 -11.50 -11.50
Start to Recovery (# months)
4 29* 29* 29* 29* 29* 29*
Start (yyyy mm) 2023 08 2022 01 2022 01 2022 01 2022 01 2022 01 2022 01
Start to Bottom (# months) 3 9 9 9 9 9 9
Bottom (yyyy mm) 2023 10 2022 09 2022 09 2022 09 2022 09 2022 09 2022 09
Bottom to End (# months) 1 20 20 20 20 20 20
End (yyyy mm) 2023 11 - - - - - -
Longest Drawdown Depth (%)
same

same

same

same

same

same

same
Start to Recovery (# months)
Start (yyyy mm) 2023 08 2022 01 2022 01 2022 01 2022 01 2022 01 2022 01
Start to Bottom (# months) 3 9 9 9 9 9 9
Bottom (yyyy mm) 2023 10 2022 09 2022 09 2022 09 2022 09 2022 09 2022 09
Bottom to End (# months) 1 20 20 20 20 20 20
End (yyyy mm) 2023 11 - - - - - -
Longest negative period (# months)
5 36* 52 52 52 52 52
Period Start (yyyy mm) 2023 06 2021 06 2019 07 2019 07 2019 07 2019 07 2019 07
Period End (yyyy mm) 2023 10 2024 05 2023 10 2023 10 2023 10 2023 10 2023 10
Annualized Return (%) -5.88 -0.88 -0.22 -0.22 -0.22 -0.22 -0.22
Drawdowns / Negative periods marked with * are in progress
Deepest Drawdown Depth (%) -3.98 -20.48 -22.21 -22.21 -22.21 -22.21 -22.21
Start to Recovery (# months)
5 34* 46* 46* 46* 46* 46*
Start (yyyy mm) 2023 08 2021 08 2020 08 2020 08 2020 08 2020 08 2020 08
Start to Bottom (# months) 3 27 39 39 39 39 39
Bottom (yyyy mm) 2023 10 2023 10 2023 10 2023 10 2023 10 2023 10 2023 10
Bottom to End (# months) 2 7 7 7 7 7 7
End (yyyy mm) 2023 12 - - - - - -
Longest Drawdown Depth (%) -3.04
same

same

same

same

same

same
Start to Recovery (# months)
5*
Start (yyyy mm) 2024 01 2021 08 2020 08 2020 08 2020 08 2020 08 2020 08
Start to Bottom (# months) 4 27 39 39 39 39 39
Bottom (yyyy mm) 2024 04 2023 10 2023 10 2023 10 2023 10 2023 10 2023 10
Bottom to End (# months) 1 7 7 7 7 7 7
End (yyyy mm) - - - - - - -
Longest negative period (# months)
11 36* 60* 120* 189 189 189
Period Start (yyyy mm) 2023 06 2021 06 2019 06 2014 06 2008 02 2008 02 2008 02
Period End (yyyy mm) 2024 04 2024 05 2024 05 2024 05 2023 10 2023 10 2023 10
Annualized Return (%) -1.28 -5.84 -2.83 -1.02 -0.04 -0.04 -0.04
Drawdowns / Negative periods marked with * are in progress
RISK INDICATORS
1Y 3Y 5Y 10Y 20Y 30Y MAX
Standard Deviation (%) 5.40 5.77 5.03 3.99 3.83 3.61 3.85
Sharpe Ratio -0.34 -0.64 -0.15 0.12 0.47 0.60 0.43
Sortino Ratio -0.56 -0.93 -0.21 0.16 0.63 0.80 0.58
Ulcer Index 1.18 6.66 5.20 3.77 2.88 2.39 2.21
Ratio: Return / Standard Deviation 0.65 -0.15 0.24 0.45 0.84 1.23 1.46
Ratio: Return / Deepest Drawdown 1.14 -0.08 0.11 0.16 0.28 0.39 0.49
Positive Months (%)
50.00 52.77 58.33 61.66 66.25 70.27 71.03
Positive Months 6 19 35 74 159 253 336
Negative Months 6 17 25 46 81 107 137
LONG TERM RETURNS
Inflation Adjusted:
Inflation Adjusted:
1Y 3Y 5Y 10Y 20Y 30Y MAX
Best 10 Years Return (%) - Annualized 1.78 4.63 7.43 9.31
Worst 10 Years Return (%) - Annualized 1.26 1.26 1.26
Best 10 Years Return (%) - Annualized -1.02 2.49 4.84 5.54
Worst 10 Years Return (%) - Annualized -1.30 -1.30 -1.30
TIMEFRAMES
Inflation Adjusted:
Inflation Adjusted:
1M 3M 6M 1Y 3Y 5Y 10Y 20Y 30Y MAX
··· Over the latest 30Y
Best Rolling Return (%) - Annualized 15.82 10.10 7.68 7.43 5.87 4.45
Worst Rolling Return (%) - Annualized -10.62 -2.23 0.79 1.26 2.99
Positive Periods (%) 87.1 93.5 100.0 100.0 100.0 100.0
Best Rolling Return (%) - Annualized 12.96 7.33 5.11 4.84 3.51 1.86
Worst Rolling Return (%) - Annualized -17.08 -7.53 -2.92 -1.30 0.40
Positive Periods (%) 70.7 86.4 90.0 89.2 100.0 100.0
95% VaR - Value at Risk (%) - Cumulative
1.35 1.87 1.99 2.90 1.99 0.00 0.00 0.00
95% CVaR - Conditional Value at Risk (%) 1.78 2.62 3.05 6.34 4.00 0.00 0.00 0.00
99% VaR - Value at Risk (%) - Cumulative
2.06 3.10 3.73 9.97 4.83 0.00 0.00 0.00
99% CVaR - Conditional Value at Risk (%) 2.51 3.88 4.84 10.45 6.63 0.00 0.00 0.00
Short term VaRs: analytical | 1+ year VaRs: historical data
Safe Withdrawal Rate (%) 90.32 29.18 19.08 9.97 5.74 5.28
Perpetual Withdrawal Rate (%) --- --- --- --- 0.45 2.24
% based on initial capital, inflation-adj. monthly withdrawals afterwards | Credits: BestRetirementPortfolio.com
··· All available data (Jan 1985 - May 2024)
Best Rolling Return (%) - Annualized 25.02 12.90 10.75 9.31 8.24 6.90
Worst Rolling Return (%) - Annualized -10.62 -2.23 0.79 1.26 2.99 4.11
Positive Periods (%) 88.7 95.2 100.0 100.0 100.0 100.0
Best Rolling Return (%) - Annualized 22.39 9.56 6.84 5.54 5.06 4.10
Worst Rolling Return (%) - Annualized -17.08 -7.53 -2.92 -1.30 0.40 1.55
Positive Periods (%) 72.5 89.9 92.7 92.6 100.0 100.0
95% VaR - Value at Risk (%) - Cumulative
1.36 1.77 1.69 2.15 0.00 0.00 0.00 0.00
95% CVaR - Conditional Value at Risk (%) 1.82 2.57 2.82 5.38 3.24 0.00 0.00 0.00
99% VaR - Value at Risk (%) - Cumulative
2.12 3.08 3.54 7.71 4.75 0.00 0.00 0.00
99% CVaR - Conditional Value at Risk (%) 2.60 3.92 4.72 9.85 6.03 0.00 0.00 0.00
Short term VaRs: analytical | 1+ year VaRs: historical data
Safe Withdrawal Rate (%) 90.32 29.18 19.08 9.97 5.74 4.96
Perpetual Withdrawal Rate (%) --- --- --- --- 0.45 1.83
% based on initial capital, inflation-adj. monthly withdrawals afterwards | Credits: BestRetirementPortfolio.com
Terms and Definitions
  • Annualized Portfolio Return: it's the annualized geometric mean return of the portfolio.
  • Deepest/Longest Drawdown: a drawdown refers to the decline in value from a relative peak value to a relative trough. The deepest (or maximum) drawdown is the maximum observed loss from a peak to a trough of a portfolio before a new peak is attained. The longest drawdown is the period observed from a peak to the subsequent peak with the greatest duration.
  • Longest negative period: it's the maximum period for which an overall negative return has been observed.
  • Standard Deviation: it's a measure of the dispersion of returns around the mean.
  • Sharpe Ratio: it's a measure of risk-adjusted performance of the portfolio. It's calculated by dividing the excess return of the portfolio over the risk-free rate by the portfolio standard deviation. The risk-free rate here considered is the 1-3 Mth T-Bill return.
  • Sortino Ratio: another measure of risk-adjusted performance of the portfolio. It's a modification of the Sharpe Ratio (same formula but the denominator is the portfolio downside standard deviation).
  • Ulcer Index: it's a measure of downside risk that quantifies the depth and duration of drawdowns in an investment portfolio.
  • Best/Worst 10Y returns: the best and the worst 10-year return over a time frame.
  • Rolling Returns: N-year returns over a time frame, calculated over all the available data source (best, worst, % of positive returns). Each rolling period, longer than the longest negative period, yielded a non-negative minimum return.
  • Value at Risk (VaR): it's an evaluation of a cumulative worst-case loss (in absolute value), associated with a probability (95%-99%) and a time horizon. For short term, it's calculated based on the expected return and standard deviation, assuming a normal distribution of monthly returns. For long term is retrieved by the historical rolling return data.
  • Conditional Value at Risk (CVaR): it represents the average expected loss if that worst-case threshold (95%-99%) is ever crossed.
  • Safe Withdrawal Rate (SWR): it's the percentage of the initial portfolio balance that can be withdrawn at the beginning of each month with inflation adjustment, without the portfolio running out of money in any case (money amount withdrawal).
    For instance: Your initial invested capital is 100.000$; withdrawal rate (annualized) is 4%. This means that, in the first month, you will withdraw 100.000 * 4% * 1/12 = 333.33$. The second month, you’ll withdraw 333.33$ plus the inflation monthly rate. You’ll continue adjusting your withdraw monthly for inflation.
  • Perpetual Withdrawal Rate (PWR): it's the percentage of the initial portfolio balance that can be withdrawn at the beginning of each month with inflation adjustment, preserving the original invested capital, adjusted for inflation too.
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Portfolio Components Correlation

Correlation measures to what degree the returns of two assets move in relation to each other. It is a statistical measure that describes the extent to which the returns of one asset are related to the returns of another asset.

COMPONENTS MONTHLY CORRELATIONS
Monthly correlations as of 31 May 2024
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Terms and Definitions
Correlation values range between -1 and +1
  • A correlation of +1 indicates that the returns of the two assets move in perfect synchrony; when one asset's returns go up, the other asset's returns also go up by the same percentage, and vice versa. This perfect positive correlation implies that the assets perform similarly in different market conditions.
  • A correlation of -1 indicates a perfect inverse relationship between the returns of the two assets. When one asset's returns go up, the other asset's returns go down by the same percentage. This perfect negative correlation suggests that the assets move in opposite directions, providing a diversification benefit by reducing overall portfolio risk.
  • A correlation of 0 means that there is no linear relationship between the returns of the two assets. The returns of one asset do not predict the returns of the other.
Learn about historical correlations here: see how the main asset classes relate to each other.

Drawdowns

A drawdown refers to the decline in value from a relative peak value to a relative trough. A maximum drawdown is the maximum observed loss from a peak to a trough of a portfolio before a new peak is attained.

CHARLES SCHWAB CONSERVATIVE INCOME PORTFOLIO
Drawdown periods
Drawdown periods - Inflation Adjusted
Data Source: 1 June 1994 - 31 May 2024 (30 Years)
Data Source: 1 January 1985 - 31 May 2024 (~39 years)
Inflation Adjusted:

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Rolling Returns

( more details)

A rolling return is a measure of investment performance that calculates the return of an investment over a set period of time, with the starting date rolling forward. This approach can provide a more accurate representation of the investment's historical performance and helps investors to evaluate the investment's consistency over time.

CHARLES SCHWAB CONSERVATIVE INCOME PORTFOLIO
Annualized Rolling Returns
Annualized Rolling Returns - Inflation Adjusted
Data Source: 1 June 1994 - 31 May 2024 (30 Years)
Data Source: 1 January 1985 - 31 May 2024 (~39 years)
Inflation Adjusted:

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If you need a deeper detail about rolling returns, please refer to the Charles Schwab Conservative Income Portfolio: Rolling Returns page.

Seasonality

In which months is it better to invest in Charles Schwab Conservative Income Portfolio?

Both the Average Return and the Gain Frequency (Win %) are useful to get an idea of what happened in the past.

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For further information about the seasonality, check the Asset Class Seasonality page.

Monthly Returns

This section provides a visual/tabular representation of the performance variability in the Charles Schwab Conservative Income Portfolio over time. It illustrates the distribution of monthly returns, showcasing the range and frequency of positive and negative returns.

CHARLES SCHWAB CONSERVATIVE INCOME PORTFOLIO
Monthly Returns Distribution
Data Source: 1 June 1994 - 31 May 2024 (30 Years)
Data Source: 1 January 1985 - 31 May 2024 (~39 years)
253 Positive Months (70%) - 107 Negative Months (30%)
336 Positive Months (71%) - 137 Negative Months (29%)

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Investment Returns, up to December 2013, have been derived using the historical series of equivalent ETFs / Assets, instead of the actual ETFs of the portfolio.
You can find additional information on extended Data Sources here.

In particular, the series derived from equivalent datasets are:
  • Vanguard Real Estate (VNQ), up to December 2004
  • Vanguard Total Bond Market (BND), up to December 2007
  • SPDR Blmbg Barclays 1-3 Mth T-Bill (BIL), up to December 2007
  • iShares TIPS Bond (TIP), up to December 2003
  • iShares iBoxx $ High Yield Corporate Bond (HYG), up to December 2007
  • Vanguard Total International Bond (BNDX), up to December 2013

Portfolio efficiency

The following portfolios granted a higher return over 30 Years and a less severe drawdown at the same time.

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In the following table, you can compare the current portfolio with a list of famous portfolios. Metrics are calculated over the last 30 Years.

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The first official book of
Build wealth
with Lazy Portfolios and Passive Investing