Bogleheads Four-fund Portfolio
The Bogleheads Four-fund Portfolio is the extension of the Bogleheads Three-fund Portfolio with the addition of international bonds. It uses four fundamental asset classes: a U.S total stock market fund, a total international stock market fund, a total bond market fund, and a total international bond market. The portfolio could be replicated using four low-cost ETFs.
Asset Allocation
| Position | Category/Sector | Target Weight |
|---|---|---|
BND Vanguard Total Bond Market ETF | Total Bond Market | 15% |
BNDX Vanguard Total International Bond ETF | Total Bond Market | 5% |
VEA Vanguard FTSE Developed Markets ETF | Foreign Large Cap Equities | 30% |
VTI Vanguard Total Stock Market ETF | Large Cap Growth Equities | 50% |
Performance
Performance Chart
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The earliest data available for this chart is Jun 4, 2013, corresponding to the inception date of BNDX
Returns By Period
As of May 11, 2025, the Bogleheads Four-fund Portfolio returned 2.29% Year-To-Date and 8.14% of annualized return in the last 10 years.
| YTD | 1M | 6M | 1Y | 5Y* | 10Y* | |
|---|---|---|---|---|---|---|
^GSPC S&P 500 | -3.77% | 7.44% | -5.60% | 8.37% | 14.12% | 10.46% |
| Bogleheads Four-fund Portfolio | 2.29% | 7.59% | 0.12% | 9.06% | 11.17% | 8.14% |
| Portfolio components: | ||||||
VTI Vanguard Total Stock Market ETF | -3.75% | 7.98% | -5.68% | 9.17% | 15.27% | 11.77% |
BND Vanguard Total Bond Market ETF | 2.21% | 0.98% | 1.19% | 5.53% | -0.78% | 1.51% |
VEA Vanguard FTSE Developed Markets ETF | 12.77% | 11.62% | 8.93% | 10.01% | 11.74% | 5.66% |
BNDX Vanguard Total International Bond ETF | 1.10% | 0.72% | 1.65% | 5.47% | 0.11% | 2.09% |
Monthly Returns
The table below presents the monthly returns of Bogleheads Four-fund Portfolio, with color gradation from worst to best to easily spot seasonal factors. Returns are adjusted for dividends.
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | Total | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2.95% | 0.11% | -2.90% | 0.97% | 1.23% | 2.29% | |||||||
| 2024 | 0.18% | 3.25% | 2.93% | -3.63% | 4.03% | 1.21% | 2.31% | 2.18% | 1.60% | -2.31% | 3.77% | -2.85% | 13.01% |
| 2023 | 6.78% | -2.72% | 2.68% | 1.43% | -1.08% | 4.69% | 2.75% | -2.25% | -4.01% | -2.57% | 8.19% | 5.03% | 19.57% |
| 2022 | -4.56% | -2.26% | 1.26% | -7.34% | 0.47% | -7.16% | 6.77% | -4.21% | -8.35% | 5.72% | 7.05% | -3.84% | -16.72% |
| 2021 | -0.54% | 1.99% | 2.49% | 3.56% | 1.32% | 1.12% | 1.27% | 1.78% | -3.47% | 4.29% | -2.05% | 3.10% | 15.59% |
| 2020 | -0.54% | -5.97% | -11.59% | 9.17% | 4.55% | 2.33% | 3.94% | 4.99% | -2.37% | -2.10% | 10.35% | 4.12% | 15.72% |
| 2019 | 6.73% | 2.52% | 1.25% | 2.82% | -4.50% | 5.53% | 0.18% | -1.09% | 1.70% | 2.04% | 2.28% | 2.47% | 23.71% |
| 2018 | 3.82% | -3.59% | -0.95% | 0.47% | 1.02% | -0.10% | 2.35% | 1.31% | 0.21% | -6.41% | 1.28% | -5.85% | -6.78% |
| 2017 | 2.01% | 2.30% | 0.95% | 1.34% | 1.68% | 0.65% | 1.87% | 0.25% | 1.89% | 1.65% | 1.78% | 1.18% | 18.99% |
| 2016 | -4.26% | -0.71% | 5.77% | 1.07% | 0.81% | -0.08% | 3.37% | 0.19% | 0.61% | -2.02% | 1.35% | 1.81% | 7.82% |
| 2015 | -0.70% | 4.47% | -0.84% | 1.36% | 0.53% | -1.95% | 1.49% | -5.29% | -2.45% | 6.03% | 0.03% | -1.75% | 0.42% |
| 2014 | -2.84% | 4.27% | 0.14% | 0.65% | 1.78% | 1.67% | -1.73% | 2.39% | -2.37% | 1.40% | 1.42% | -1.05% | 5.63% |
Expense Ratio
Bogleheads Four-fund Portfolio has an expense ratio of 0.04%, which is considered low. Below, you can find the expense ratios of the portfolio's funds side by side and easily compare their relative costs.
Risk-Adjusted Performance
Risk-Adjusted Performance Rank
The current rank of Bogleheads Four-fund Portfolio is 58, indicating average performance compared to other portfolios on our website. Here’s a breakdown of how it compares using common performance measures.
Risk-Adjusted Performance Indicators
This table presents a comparison of risk-adjusted performance metrics for positions. Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.
| Sharpe ratio | Sortino ratio | Omega ratio | Calmar ratio | Martin ratio | |
|---|---|---|---|---|---|
VTI Vanguard Total Stock Market ETF | 0.47 | 0.83 | 1.12 | 0.51 | 1.94 |
BND Vanguard Total Bond Market ETF | 1.00 | 1.45 | 1.17 | 0.42 | 2.54 |
VEA Vanguard FTSE Developed Markets ETF | 0.59 | 1.00 | 1.13 | 0.80 | 2.42 |
BNDX Vanguard Total International Bond ETF | 1.40 | 1.97 | 1.24 | 0.57 | 6.11 |
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Dividends
Dividend yield
Bogleheads Four-fund Portfolio provided a 2.32% dividend yield over the last twelve months.
| TTM | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2.32% | 2.40% | 2.35% | 2.17% | 2.04% | 1.71% | 2.38% | 2.60% | 2.18% | 2.35% | 2.33% | 2.48% |
| Portfolio components: | ||||||||||||
VTI Vanguard Total Stock Market ETF | 1.35% | 1.27% | 1.44% | 1.67% | 1.21% | 1.42% | 1.78% | 2.04% | 1.71% | 1.92% | 1.98% | 1.76% |
BND Vanguard Total Bond Market ETF | 3.75% | 3.67% | 3.09% | 2.60% | 1.97% | 2.22% | 2.72% | 2.81% | 2.54% | 2.51% | 2.57% | 2.79% |
VEA Vanguard FTSE Developed Markets ETF | 2.91% | 3.36% | 3.16% | 2.91% | 3.16% | 2.04% | 3.04% | 3.35% | 2.77% | 3.05% | 2.92% | 3.68% |
BNDX Vanguard Total International Bond ETF | 4.29% | 4.18% | 4.42% | 1.52% | 3.74% | 1.11% | 3.40% | 3.01% | 2.23% | 1.89% | 1.63% | 1.54% |
Drawdowns
Drawdowns Chart
The Drawdowns chart displays portfolio losses from any high point along the way. Drawdowns are calculated considering price movements and all distributions paid, if any.
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Worst Drawdowns
The table below displays the maximum drawdowns of the Bogleheads Four-fund Portfolio. A maximum drawdown is a measure of risk, indicating the largest reduction in portfolio value due to a series of losing trades.
The maximum drawdown for the Bogleheads Four-fund Portfolio was 28.24%, occurring on Mar 23, 2020. Recovery took 99 trading sessions.
The current Bogleheads Four-fund Portfolio drawdown is 2.48%.
Depth | Start | To Bottom | Bottom | To Recover | End | Total |
|---|---|---|---|---|---|---|
| -28.24% | Feb 13, 2020 | 27 | Mar 23, 2020 | 99 | Aug 12, 2020 | 126 |
| -24.38% | Nov 9, 2021 | 233 | Oct 12, 2022 | 327 | Feb 1, 2024 | 560 |
| -15.13% | Jan 29, 2018 | 229 | Dec 24, 2018 | 75 | Apr 12, 2019 | 304 |
| -13.8% | May 22, 2015 | 183 | Feb 11, 2016 | 117 | Jul 29, 2016 | 300 |
| -13.02% | Feb 19, 2025 | 35 | Apr 8, 2025 | — | — | — |
Volatility
Volatility Chart
The chart below shows the rolling one-month volatility.
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Diversification
Diversification Metrics
Number of Effective Assets
The portfolio contains 4 assets, with an effective number of assets of 2.74, reflecting the diversification based on asset allocation. This number of effective assets suggests a highly concentrated portfolio, where a few assets dominate the allocation, potentially increasing the portfolio's risk due to lack of diversification.
Asset Correlations Table
| ^GSPC | BNDX | BND | VEA | VTI | Portfolio | |
|---|---|---|---|---|---|---|
| ^GSPC | 1.00 | -0.01 | -0.03 | 0.81 | 0.99 | 0.96 |
| BNDX | -0.01 | 1.00 | 0.72 | 0.01 | -0.01 | 0.05 |
| BND | -0.03 | 0.72 | 1.00 | 0.02 | -0.03 | 0.05 |
| VEA | 0.81 | 0.01 | 0.02 | 1.00 | 0.81 | 0.92 |
| VTI | 0.99 | -0.01 | -0.03 | 0.81 | 1.00 | 0.97 |
| Portfolio | 0.96 | 0.05 | 0.05 | 0.92 | 0.97 | 1.00 |
AI Insight on Diversification
The portfolio is moderately diversified with a mix of asset classes that exhibit varying degrees of correlation. The correlation matrix reveals that the two bond funds, BNDX (international bonds) and BND (U.S. bonds), have a relatively high correlation of 0.72, indicating some overlap in their bond exposure which may slightly reduce diversification benefits within the fixed income portion. In contrast, VEA (developed international equities) and VTI (U.S. equities) show a strong positive correlation of 0.81, reflecting their shared equity market exposure, which is expected but suggests these two equity positions move closely together.
Notably, the bond funds (BNDX and BND) have near-zero or slightly negative correlations with the equity funds (VEA and VTI), with values close to zero or slightly below, which is beneficial for diversification as bonds and equities often behave differently in various market environments. This low correlation between bonds and equities helps reduce overall portfolio volatility.
Examining the portfolio’s correlation with individual positions, VTI has the highest correlation at 0.97, indicating it is the dominant driver of the portfolio’s returns and risk profile. VEA also has a high correlation with the portfolio at 0.92, reinforcing the significant influence of equity holdings. The bond funds have much lower correlations with the portfolio (around 0.05), suggesting they contribute more to risk reduction than to return dominance.
Overall, the portfolio is well diversified across asset classes, balancing equity and bond exposures. However, the relatively high correlation between the two equity funds and between the two bond funds indicates some concentration within asset classes. The dominance of VTI in the portfolio’s behavior suggests a tilt toward U.S. equities, which could impact diversification if market conditions heavily affect that segment. Still, the inclusion of international bonds and equities provides meaningful diversification benefits, making the portfolio broadly diversified but with some room to improve within asset class diversification.