Vanguard Growth Portfolio: Rebalancing Strategy

Data Source: from January 1988 to September 2024
Consolidated Returns as of 30 September 2024

Managing the Vanguard Growth Portfolio with a yearly rebalancing, you would have obtained a 8.30% compound annual return in the last 30 Years.

With a quarterly rebalancing, over the same period, the return would have been 7.99%.

How do returns and drawdowns change, implementing different rebalancing strategies?

Rebalancing Strategies

In order to keep risk under control, you should rebalance assets quotes from time to time, so to keep them at the original percentage of the asset allocation.

Rebalancing can be performed in several ways.

At fixed time intervals:
  • Yearly: Jan 1st
  • Half Yearly: Jan 1st, Jul 1st
  • Quarterly: Jan 1st, Apr 1st, Jul 1st, Oct 1st
When a component (at least one) diverges from its original weight beyond a certain threshold (e.g. 5% or 10%).

Portfolio Returns as of Sep 30, 2024

Implementing different rebalancing strategies, the Vanguard Growth Portfolio guaranteed the following returns.

According to the available data source, we assume we built the portfolio on January 1988.

Portfolio returns are calculated in CAD, assuming:
  • No fees or capital gain taxes
  • the reinvestment of dividends, if existing
  • the adjustment for actual currency exchange rates (simulation derived from original US returns)
  • the currency hedging (simulation taking into account the interest rate differentials of the countries). It is also assumed that hedged instruments have an additional expense ratio of 0.25% (yearly), compared to the US original instrument.
VANGUARD GROWTH PORTFOLIO RETURNS
Period: January 1988 - September 2024
Annualized Returns
Swipe left to see all data
Return (%) and number of rebalances as of Sep 30, 2024
Rebalancing Strategy 1Y 5Y 10Y 30Y MAX
(~37Y)
No Rebalancing 30.25 (0) 12.17 (0) 10.79 (0) 8.30 (0) 9.18 (0)
Yearly Rebalancing 25.75 (1) 9.80 (5) 8.99 (10) 8.06 (30) 8.69 (37)
Half Yearly Rebalancing 25.74 (2) 9.81 (10) 8.99 (20) 7.99 (60) 8.60 (74)
Quarterly Rebalancing 25.66 (4) 9.84 (20) 8.98 (40) 7.96 (120) 8.56 (147)
5% Tolerance per asset 25.68 (0) 10.12 (2) 9.11 (4) 8.05 (11) 8.70 (13)
10% Tolerance per asset 25.68 (0) 10.25 (1) 9.29 (2) 8.08 (5) 8.84 (6)

In order to have complete information about the portfolio, please refer to the Vanguard Growth Portfolio: ETF allocation and returns page.

Performances as of Sep 30, 2024

Historical returns and stats of Vanguard Growth Portfolio, after implementing different rebalancing strategies.

VANGUARD GROWTH PORTFOLIO PERFORMANCES
Period: January 1988 - September 2024
Swipe left to see all data
Standard Deviation
Max Drawdown (%)
Rebalancing Strategy Return % Std Dev(%) Ret. / Std Dev MaxDD(%) Ret. / MaxDD
No Rebalancing 9.18 (0) 11.17 0.82 -34.38 0.27
Yearly Rebalancing 8.69 (37) 10.04 0.87 -32.25 0.27
Half Yearly Rebalancing 8.60 (74) 10.02 0.86 -32.16 0.27
Quarterly Rebalancing 8.56 (147) 10.04 0.85 -32.66 0.26
5% Tolerance per asset 8.70 (13) 10.08 0.86 -32.15 0.27
10% Tolerance per asset 8.84 (6) 10.23 0.86 -33.12 0.27
(*) Since Jan 1988 (~37 yrs) | Annualized Returns (and number of rebalances)

Drawdowns as of Sep 30, 2024

Historical Drawdowns of Vanguard Growth Portfolio, after implementing different rebalancing strategies.

VANGUARD GROWTH PORTFOLIO DRAWDOWNS
Period: January 1988 - September 2024
Swipe left to see all data
Rebalancing
Tolerance per asset
No Rebalancing Yearly Half Yearly Quarterly 5% 10%
-34.38
Jun 2007 - Mar 2011
-32.25
Jun 2007 - Jan 2011
-32.16
Jun 2007 - Jan 2011
-32.66
Jun 2007 - Feb 2011
-32.15
Jun 2007 - Apr 2011
-33.12
Jun 2007 - Apr 2011
-34.32
Sep 2000 - Mar 2006
-31.69
Sep 2000 - Dec 2005
-31.68
Sep 2000 - Dec 2005
-31.26
Sep 2000 - Dec 2005
-31.28
Sep 2000 - Nov 2005
-30.92
Sep 2000 - Dec 2005
-17.56
Jan 2022 - Nov 2023
-16.06
Jan 2022 - Dec 2023
-15.99
Jan 2022 - Dec 2023
-15.95
Jan 2022 - Dec 2023
-16.20
Jan 2022 - Dec 2023
-16.37
Jan 2022 - Nov 2023
-15.64
Feb 2020 - Jul 2020
-14.98
Jan 1990 - Mar 1991
-15.13
Jan 1990 - Mar 1991
-15.10
Jan 1990 - Mar 1991
-15.24
Feb 2020 - Jul 2020
-15.45
Jan 1990 - Feb 1991
-15.45
Jan 1990 - Feb 1991
-14.93
Feb 2020 - Jul 2020
-14.93
Feb 2020 - Jul 2020
-14.93
Feb 2020 - Jul 2020
-14.83
Jan 1990 - Mar 1991
-15.21
Feb 2020 - Jul 2020
5 Worst Drawdowns - Average
-23.47 -21.98 -21.98 -21.98 -21.94 -22.21
10 Worst Drawdowns - Average
-16.77 -15.43 -15.42 -15.42 -15.39 -15.62

For a deeper insight, please refer to the Vanguard Growth Portfolio: ETF allocation and returns page.