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Monday, September 13, 2010

Lost Decade for Investors ? Some More Data

While it is true US stocks turned in a negative performance for the past 10 years, a balanced portfolio would have shown better results and few investors that paid attention to their asset allocation would in fact hold 100% s+p 500

here is a relatively straightforward global portfolio

us total stock market russell 3000  30%
us small value russell 2000 value 10%
emerging markets msci 10%
developed intl msci  10%
aggregate bonds      40%

$ 1000 invested in this portfolio for the last ten years would have grown to $1630 vs $880 for 100% s+p 500

the 20 year numbers  are close;
4920 for the 60/40 and 4,500 for the 100% sp 500

missing out on emerging markets would have cut performance drastically

$1000 in emerging markets grew to $3,000 in the last 10 years  $17,280 in the last 20 years

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