Developed World 40/60 To EUR Portfolio: Rebalancing Strategy

Data Source: from January 1972 to April 2024
Consolidated Returns as of 30 April 2024

Managing the Developed World 40/60 To EUR Portfolio with a yearly rebalancing, you would have obtained a 5.47% compound annual return in the last 30 Years.

With a quarterly rebalancing, over the same period, the return would have been 5.42%.

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 Apr 30, 2024

Implementing different rebalancing strategies, the Developed World 40/60 To EUR Portfolio guaranteed the following returns.

According to the available data source, we assume we built the portfolio on January 1972.

Portfolio returns are calculated in EUR, 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)
DEVELOPED WORLD 40/60 TO EUR PORTFOLIO RETURNS
Period: January 1972 - April 2024
Annualized Returns
Swipe left to see all data
Return (%) and number of rebalances as of Apr 30, 2024
Rebalancing Strategy 1Y 5Y 10Y 30Y MAX
(~52Y)
Yearly Rebalancing 8.46 (1) 3.61 (5) 5.67 (10) 5.47 (30) 6.47 (53)
Half Yearly Rebalancing 8.31 (2) 3.56 (10) 5.69 (20) 5.37 (60) 6.40 (105)
Quarterly Rebalancing 8.23 (4) 3.66 (20) 5.75 (40) 5.42 (120) 6.44 (210)
5% Tolerance per asset 8.64 (1) 3.62 (3) 5.68 (4) 5.42 (15) 6.45 (22)
10% Tolerance per asset 8.84 (0) 3.88 (1) 5.97 (2) 5.55 (6) 6.49 (7)

In order to have complete information about the portfolio, please refer to the Developed World 40/60 To EUR Portfolio: ETF allocation and returns page.

Performances as of Apr 30, 2024

Historical returns and stats of Developed World 40/60 To EUR Portfolio, after implementing different rebalancing strategies.

DEVELOPED WORLD 40/60 TO EUR PORTFOLIO PERFORMANCES
Period: January 1972 - April 2024
Swipe left to see all data
Standard Deviation
Max Drawdown (%)
Rebalancing Strategy Return % Std Dev(%) Ret. / Std Dev MaxDD(%) Ret. / MaxDD
Yearly Rebalancing 6.47 (53) 7.40 0.87 -22.71 0.28
Half Yearly Rebalancing 6.40 (105) 7.37 0.87 -23.54 0.27
Quarterly Rebalancing 6.44 (210) 7.37 0.87 -22.91 0.28
5% Tolerance per asset 6.45 (22) 7.44 0.87 -23.26 0.28
10% Tolerance per asset 6.49 (7) 7.42 0.87 -24.01 0.27
(*) Since Jan 1972 (~52 yrs) | Annualized Returns (and number of rebalances)

Drawdowns as of Apr 30, 2024

Historical Drawdowns of Developed World 40/60 To EUR Portfolio, after implementing different rebalancing strategies.

DEVELOPED WORLD 40/60 TO EUR PORTFOLIO DRAWDOWNS
Period: January 1972 - April 2024
Swipe left to see all data
Rebalancing
Tolerance per asset
Yearly Half Yearly Quarterly 5% 10%
-22.71
Sep 2000 - May 2007
-23.54
Sep 2000 - Feb 2010
-22.91
Sep 2000 - Feb 2010
-23.26
Sep 2000 - May 2007
-24.01
Sep 2000 - May 2007
-19.53
Feb 1994 - Apr 1996
-19.52
Feb 1994 - Apr 1996
-19.52
Feb 1994 - Apr 1996
-19.59
Feb 1994 - Apr 1996
-19.38
Feb 1994 - Apr 1996
-17.55
Jan 1973 - Oct 1975
-17.70
Jan 1973 - Nov 1975
-17.54
Jan 1973 - Nov 1975
-17.58
Jan 1973 - Nov 1975
-17.95
Jan 1973 - Nov 1975
-15.20
Jun 2007 - Jan 2010
-13.41
Jan 2022 - In progress
-13.40
Jan 2022 - In progress
-16.42
Jun 2007 - Jan 2010
-16.65
Jun 2007 - Jan 2010
-13.52
Jan 2022 - In progress
-12.59
Oct 1987 - Jul 1988
-12.26
Sep 1989 - Mar 1991
-13.52
Jan 2022 - In progress
-13.35
Jan 2022 - In progress
5 Worst Drawdowns - Average
-17.70 -17.35 -17.12 -18.07 -18.27
10 Worst Drawdowns - Average
-13.83 -12.94 -12.82 -13.94 -14.00

For a deeper insight, please refer to the Developed World 40/60 To EUR Portfolio: ETF allocation and returns page.