Developed World 60/40 To EUR Portfolio: Rebalancing Strategy

Data Source: from January 1972 to May 2024
Consolidated Returns as of 31 May 2024

Managing the Developed World 60/40 To EUR Portfolio with a yearly rebalancing, you would have obtained a 6.41% compound annual return in the last 30 Years.

With a quarterly rebalancing, over the same period, the return would have been 6.35%.

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 May 31, 2024

Implementing different rebalancing strategies, the Developed World 60/40 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 60/40 TO EUR PORTFOLIO RETURNS
Period: January 1972 - May 2024
Annualized Returns
Swipe left to see all data
Return (%) and number of rebalances as of May 31, 2024
Rebalancing Strategy 1Y 5Y 10Y 30Y MAX
(~52Y)
Yearly Rebalancing 11.93 (1) 6.99 (5) 7.54 (10) 6.41 (30) 7.06 (53)
Half Yearly Rebalancing 11.78 (2) 6.94 (10) 7.56 (20) 6.30 (60) 7.00 (105)
Quarterly Rebalancing 11.66 (4) 7.01 (20) 7.63 (40) 6.35 (120) 7.03 (210)
5% Tolerance per asset 12.12 (1) 7.03 (3) 7.58 (4) 6.35 (15) 6.99 (18)
10% Tolerance per asset 13.28 (1) 7.54 (2) 7.88 (3) 6.56 (7) 7.10 (7)

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

Performances as of May 31, 2024

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

DEVELOPED WORLD 60/40 TO EUR PORTFOLIO PERFORMANCES
Period: January 1972 - May 2024
Swipe left to see all data
Standard Deviation
Max Drawdown (%)
Rebalancing Strategy Return % Std Dev(%) Ret. / Std Dev MaxDD(%) Ret. / MaxDD
Yearly Rebalancing 7.06 (53) 9.11 0.78 -34.38 0.21
Half Yearly Rebalancing 7.00 (105) 9.10 0.77 -35.13 0.20
Quarterly Rebalancing 7.03 (210) 9.11 0.77 -34.59 0.20
5% Tolerance per asset 6.99 (18) 9.23 0.76 -34.54 0.20
10% Tolerance per asset 7.10 (7) 9.37 0.76 -34.86 0.20
(*) Since Jan 1972 (~52 yrs) | Annualized Returns (and number of rebalances)

Drawdowns as of May 31, 2024

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

DEVELOPED WORLD 60/40 TO EUR PORTFOLIO DRAWDOWNS
Period: January 1972 - May 2024
Swipe left to see all data
Rebalancing
Tolerance per asset
Yearly Half Yearly Quarterly 5% 10%
-34.38
Sep 2000 - Nov 2010
-35.13
Sep 2000 - Dec 2010
-34.59
Sep 2000 - Dec 2010
-34.54
Sep 2000 - Dec 2010
-34.86
Sep 2000 - Nov 2010
-22.57
Jan 1973 - Dec 1975
-22.83
Jan 1973 - Jan 1976
-22.85
Jan 1973 - Jan 1976
-22.88
Jan 1973 - Dec 1975
-22.88
Jan 1973 - Jan 1976
-20.27
Feb 1994 - Apr 1996
-20.26
Feb 1994 - Apr 1996
-20.25
Feb 1994 - Apr 1996
-20.27
Feb 1994 - Apr 1996
-20.47
Feb 1994 - Apr 1996
-18.17
Oct 1987 - Jan 1989
-17.76
Oct 1987 - Jan 1989
-17.28
Oct 1987 - Jan 1989
-18.51
Oct 1987 - Jan 1989
-19.85
Oct 1987 - Jan 1989
-15.19
Sep 1989 - May 1991
-15.16
Sep 1989 - Apr 1991
-15.15
Sep 1989 - May 1991
-15.70
Sep 1989 - May 1991
-16.46
Sep 1989 - Aug 1991
5 Worst Drawdowns - Average
-22.11 -22.23 -22.03 -22.38 -22.90
10 Worst Drawdowns - Average
-16.56 -16.54 -16.44 -16.74 -17.08

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