Stocks/Bonds 40/60 To EUR Portfolio: Rebalancing Strategy

Data Source: from August 1953 to November 2024
Consolidated Returns as of 30 November 2024

Managing the Stocks/Bonds 40/60 To EUR Portfolio with a yearly rebalancing, you would have obtained a 10.95% compound annual return in the last 30 Years.

With a quarterly rebalancing, over the same period, the return would have been 7.83%.

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 Nov 30, 2024

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

According to the available data source, we assume we built the portfolio on August 1953.

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)
STOCKS/BONDS 40/60 TO EUR PORTFOLIO RETURNS
Period: August 1953 - November 2024
Annualized Returns
Swipe left to see all data
Return (%) and number of rebalances as of Nov 30, 2024
Rebalancing Strategy 1Y 5Y 10Y 30Y MAX
(~71Y)
No Rebalancing 38.04 (0) 15.66 (0) 14.08 (0) 10.95 (0) 10.08 (0)
Yearly Rebalancing 21.65 (1) 7.14 (5) 7.83 (10) 7.96 (30) 8.36 (71)
Half Yearly Rebalancing 21.27 (2) 7.08 (10) 7.79 (20) 7.83 (60) 8.31 (142)
Quarterly Rebalancing 21.14 (4) 7.11 (20) 7.84 (40) 7.91 (120) 8.31 (285)
5% Tolerance per asset 21.57 (1) 7.07 (3) 7.84 (5) 8.03 (23) 8.39 (44)
10% Tolerance per asset 22.33 (1) 7.50 (2) 8.12 (3) 8.22 (9) 8.40 (13)

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

Performances as of Nov 30, 2024

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

STOCKS/BONDS 40/60 TO EUR PORTFOLIO PERFORMANCES
Period: August 1953 - November 2024
Swipe left to see all data
Standard Deviation
Max Drawdown (%)
Rebalancing Strategy Return % Std Dev(%) Ret. / Std Dev MaxDD(%) Ret. / MaxDD
No Rebalancing 10.08 (0) 13.96 0.72 -51.90 0.19
Yearly Rebalancing 8.36 (71) 10.37 0.81 -28.01 0.30
Half Yearly Rebalancing 8.31 (142) 10.32 0.80 -26.97 0.31
Quarterly Rebalancing 8.31 (285) 10.33 0.80 -26.54 0.31
5% Tolerance per asset 8.39 (44) 10.39 0.81 -27.13 0.31
10% Tolerance per asset 8.40 (13) 10.50 0.80 -27.97 0.30
(*) Since Aug 1953 (~71 yrs) | Annualized Returns (and number of rebalances)

Drawdowns as of Nov 30, 2024

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

STOCKS/BONDS 40/60 TO EUR PORTFOLIO DRAWDOWNS
Period: August 1953 - November 2024
Swipe left to see all data
Rebalancing
Tolerance per asset
No Rebalancing Yearly Half Yearly Quarterly 5% 10%
-51.90
Sep 2000 - Mar 2013
-28.01
Mar 1985 - Apr 1989
-26.97
Mar 1985 - Mar 1989
-26.54
Mar 1985 - Mar 1989
-27.13
Mar 1985 - Mar 1989
-27.97
Mar 1985 - Apr 1989
-39.53
Jan 1973 - Jun 1976
-25.96
Nov 2000 - May 2010
-26.80
Nov 2000 - May 2010
-25.87
Nov 2000 - May 2010
-25.55
Nov 2000 - May 2010
-26.63
Jan 1973 - Jan 1976
-31.34
Sep 1987 - Mar 1989
-23.92
Jan 1973 - Dec 1975
-24.65
Jan 1973 - Dec 1975
-24.48
Jan 1973 - Jan 1976
-24.46
Jan 1973 - Jan 1976
-25.77
Nov 2000 - May 2010
-30.41
Sep 1989 - May 1991
-22.97
Sep 1989 - Apr 1991
-22.94
Sep 1989 - Apr 1991
-22.96
Sep 1989 - Apr 1991
-23.01
Sep 1989 - Apr 1991
-23.77
Sep 1989 - Apr 1991
-23.04
Dec 1968 - Feb 1971
-15.26
Jan 1977 - Jun 1979
-15.35
Jan 1977 - Jun 1979
-15.26
Jan 1977 - Jun 1979
-15.41
Jan 1977 - Jun 1979
-15.17
Jan 1977 - Jun 1979
5 Worst Drawdowns - Average
-35.24 -23.22 -23.34 -23.02 -23.11 -23.86
10 Worst Drawdowns - Average
-25.67 -17.32 -17.33 -17.20 -17.23 -18.03

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