Balanced Strategy Performance (as of 4/18/2024)
The chart below compares the performance of our Balanced investment strategy to a typical “buy and hold” portfolio consisting of 60% stocks and 40% bonds. The Balanced strategy has been consistently profitable, with a compound annual growth rate (CAGR) of 10.1%. An initial investment of $1,000 in 1996 would be worth $14,357 today [1].
| Strategy: | Balanced | 60/40 Benchmark [2] |
|---|---|---|
| Compound Annual Growth Rate [1] | 10.1% | 7.9% |
| Standard Deviation [3] | 8.2% | 10.7% |
| Maximum Drawdown [5] | -17.8% | -29.8% |
| Sharpe Ratio [4] | 0.89 | 0.51 |
| Growth of $1,000 invested in 1996 | $14,357 | $8,220 |
Annual Performance
| Year | Balanced Strategy | 60/40 Benchmark |
|---|---|---|
| 1997 | 14.05% | 23.53% |
| 1998 | 9.13% | 20.18% |
| 1999 | 20.81% | 11.72% |
| 2000 | 12.30% | -1.49% |
| 2001 | 2.61% | -4.32% |
| 2002 | 10.50% | -7.87% |
| 2003 | 20.69% | 17.73% |
| 2004 | 16.08% | 8.11% |
| 2005 | 9.35% | 3.93% |
| 2006 | 19.02% | 10.52% |
| 2007 | 11.73% | 7.23% |
| 2008 | 13.99% | -14.92% |
| 2009 | 7.26% | 13.18% |
| 2010 | 15.61% | 12.78% |
| 2011 | 15.71% | 7.39% |
| 2012 | 7.56% | 11.06% |
| 2013 | 6.66% | 16.95% |
| 2014 | 8.04% | 11.70% |
| 2015 | -5.18% | 1.36% |
| 2016 | 4.49% | 7.60% |
| 2017 | 7.79% | 14.04% |
| 2018 | -5.07% | -2.34% |
| 2019 | 12.82% | 21.94% |
| 2020 | 10.17% | 14.93% |
| 2021 | 15.65% | 15.92% |
| 2022 | -3.53% | -16.97% |
| 2023 | 4.95% | 17.16% |
| 2024 | 7.05% | 1.58% |
Monthly Strategy Performance
| Year | JAN | FEB | MAR | APR | MAY | JUN | JUL | AUG | SEP | OCT | NOV | DEC | Year |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 1996 | 2.1 | 2.2 | 3.1 | 5.0 | 12.93% | ||||||||
| 1997 | 1.3 | 0.9 | -1.5 | -1.3 | 2.5 | 3.5 | 3.0 | -2.8 | 6.4 | -0.6 | 0.6 | 1.6 | 14.05% |
| 1998 | 0.6 | 1.4 | 2.8 | 0.2 | 0.3 | 0.5 | -1.1 | 0.8 | 2.7 | -0.8 | 0.7 | 0.9 | 9.13% |
| 1999 | 0.3 | -3.2 | 5.8 | 4.9 | -0.8 | 2.8 | -0.8 | 0.7 | 2.7 | -2.1 | 1.0 | 8.4 | 20.81% |
| 2000 | 1.2 | 3.3 | 0.7 | -0.9 | 0.9 | 2.6 | 0.4 | 1.1 | -0.6 | -1.0 | 1.3 | 2.8 | 12.30% |
| 2001 | 0.8 | 0.1 | -3.0 | 0.1 | -0.5 | 2.6 | 0.2 | 2.1 | -0.4 | 0.9 | -1.9 | 1.6 | 2.61% |
| 2002 | 0.9 | 1.6 | 1.6 | 1.5 | 2.1 | -0.9 | -1.4 | 3.7 | 2.6 | -4.0 | -0.4 | 2.9 | 10.50% |
| 2003 | 1.8 | 0.8 | -5.2 | 2.8 | 6.5 | -1.1 | 0.6 | 3.3 | 2.7 | 0.8 | 1.9 | 4.6 | 20.69% |
| 2004 | 3.1 | 2.4 | 2.2 | -9.6 | 2.5 | 0.2 | 1.2 | 2.8 | 2.5 | 3.2 | 2.6 | 2.6 | 16.08% |
| 2005 | -0.1 | 2.3 | -1.8 | -0.8 | 1.6 | 2.0 | 2.4 | 0.4 | 1.3 | -4.5 | 2.5 | 3.8 | 9.35% |
| 2006 | 5.0 | -0.7 | 2.8 | 1.8 | -3.2 | -0.8 | 1.9 | 1.5 | 0.7 | 3.4 | 3.5 | 1.8 | 19.02% |
| 2007 | 1.8 | 1.5 | -0.9 | 1.3 | 0.8 | -1.7 | 1.0 | -0.2 | 2.3 | 3.8 | 0.4 | 1.0 | 11.73% |
| 2008 | 3.4 | 3.1 | -0.9 | -0.1 | 0.3 | 2.3 | -3.3 | -0.5 | -0.8 | -4.0 | 7.2 | 7.0 | 13.99% |
| 2009 | -4.5 | -0.2 | 1.1 | 0.3 | 3.4 | -1.8 | 2.8 | 1.6 | 2.1 | -0.5 | 6.6 | -3.3 | 7.26% |
| 2010 | -2.2 | 0.9 | 3.2 | 2.7 | -0.5 | 1.8 | 0.7 | 3.4 | 2.0 | 1.4 | -1.9 | 3.2 | 15.61% |
| 2011 | 0.6 | 3.1 | 0.4 | 4.0 | -1.0 | -2.9 | 2.2 | 7.5 | -0.2 | 0.2 | 0.1 | 1.2 | 15.71% |
| 2012 | 1.1 | 0.5 | -0.1 | 0.9 | 1.0 | 1.2 | 2.4 | 0.1 | -0.6 | -0.8 | 0.2 | 1.3 | 7.56% |
| 2013 | -0.7 | -0.4 | 1.7 | 2.5 | -3.7 | -2.8 | 3.7 | -1.5 | 2.2 | 3.2 | 1.2 | 1.4 | 6.66% |
| 2014 | -1.7 | 2.5 | -0.7 | 1.5 | 2.3 | 0.1 | -0.8 | 3.5 | -3.9 | 1.9 | 2.3 | 0.9 | 8.04% |
| 2015 | 7.3 | -2.8 | -0.6 | -0.4 | -2.2 | -3.8 | 1.9 | -4.7 | -0.2 | 1.2 | -0.9 | 0.3 | -5.18% |
| 2016 | 0.4 | 3.4 | 0.9 | 0.1 | -0.9 | 4.9 | 0.9 | -1.7 | -0.0 | -1.9 | -3.2 | 1.8 | 4.49% |
| 2017 | 0.4 | 2.2 | -0.5 | 0.4 | 1.4 | -0.3 | 1.0 | 0.9 | -0.4 | 0.8 | 0.8 | 0.9 | 7.79% |
| 2018 | 3.3 | -4.4 | -0.9 | 0.8 | 1.0 | -1.3 | -0.4 | 1.4 | 0.4 | -5.6 | 0.9 | -0.2 | -5.07% |
| 2019 | 2.1 | -0.2 | 2.3 | -0.6 | 2.0 | 1.9 | -0.2 | 5.5 | -1.6 | 0.6 | -0.9 | 1.3 | 12.82% |
| 2020 | 2.0 | -2.1 | 2.4 | 1.0 | 0.2 | 0.1 | 5.2 | -0.2 | -3.9 | -2.4 | 3.6 | 4.1 | 10.17% |
| 2021 | -0.2 | 2.9 | 0.6 | 5.4 | 1.6 | 1.4 | 2.4 | 0.4 | -2.8 | 4.2 | -2.7 | 1.7 | 15.65% |
| 2022 | -3.2 | 3.5 | 5.1 | -1.1 | 0.5 | -4.0 | -0.4 | -3.0 | -5.6 | 1.8 | 4.4 | -0.9 | -3.53% |
| 2023 | 4.3 | -4.2 | 2.7 | 1.2 | -2.9 | 2.6 | 1.9 | -1.9 | -3.0 | -0.8 | 2.9 | 2.5 | 4.95% |
| 2024 | -0.3 | 1.9 | 4.5 | 0.9 | 7.05% |
Notes
- The Balanced strategy was made available to subscribers on 3/31/2013. Performance results before this date represent a hypothetical strategy backtest. Strategy performance is tracked and verified by TimerTrac.com. (Note that Allocations made within the past 3 months are only shown to current subscribers).
- The benchmark portfolio is a typical allocation of 60% U.S. stocks and 40% bonds, rebalanced annually.
- Standard deviation, also known as historical volatility, is used by investors as a gauge of the amount of expected portfolio volatility. Volatile funds or portfolios have a high standard deviation. When comparing investments, a low standard deviation is preferable.
- The Sharpe Ratio measures risk-adjusted performance. It's calculated by subtracting the risk-free interest rate from the rate of return for a specific portfolio, and dividing the result by the standard deviation of the portfolio returns. We use U.S. Treasury Bill returns as our risk-free investment. When comparing portfolios, a high Sharpe Ratio is preferable.
- Drawdown: the peak-to-trough decline in investment or portfolio value, measured as a percentage between the peak and the trough. A good investment strategy aims to minimize drawdowns.