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Bogleheads Four-fund Portfolio

Last updated Dec 2, 2023

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


BND 15%BNDX 5%VTI 50%VEA 30%BondBondEquityEquity
PositionCategory/SectorWeight
BND
Vanguard Total Bond Market ETF
Total Bond Market15%
BNDX
Vanguard Total International Bond ETF
Total Bond Market5%
VTI
Vanguard Total Stock Market ETF
Large Cap Growth Equities50%
VEA
Vanguard FTSE Developed Markets ETF
Foreign Large Cap Equities30%

Performance

The chart shows the growth of an initial investment of $10,000 in Bogleheads Four-fund Portfolio, comparing it to the performance of the S&P 500 index or another benchmark. All prices have been adjusted for splits and dividends. The portfolio is rebalanced Quarterly


-6.00%-4.00%-2.00%0.00%2.00%4.00%6.00%8.00%JulyAugustSeptemberOctoberNovemberDecember
5.02%
7.29%
Bogleheads Four-fund Portfolio
Benchmark (^GSPC)
Portfolio components

The earliest data available for this chart is Jun 4, 2013, corresponding to the inception date of BNDX

Returns

As of Dec 2, 2023, the Bogleheads Four-fund Portfolio returned 14.85% Year-To-Date and 7.51% of annualized return in the last 10 years.


Year-To-Date1 month6 months1 year5 years (annualized)10 years (annualized)
^GSPC
N/AN/AN/AN/AN/AN/A
Bogleheads Four-fund Portfolio14.85%8.08%5.02%9.95%8.32%7.51%
VTI
Vanguard Total Stock Market ETF
20.72%9.25%8.07%13.58%11.92%11.34%
BND
Vanguard Total Bond Market ETF
2.86%4.38%0.50%1.19%0.87%1.43%
VEA
Vanguard FTSE Developed Markets ETF
12.86%8.81%2.61%9.46%6.25%4.41%
BNDX
Vanguard Total International Bond ETF
6.03%3.48%2.47%2.53%0.64%2.10%

Monthly Returns Heatmap


JanFebMarAprMayJunJulAugSepOctNovDec
2023-1.08%4.69%2.75%-2.25%-4.01%-2.57%8.18%

Sharpe Ratio

The current Bogleheads Four-fund Portfolio Sharpe ratio is 0.93. A Sharpe ratio between 0 and 1.0 is considered sub-optimal.

-1.000.001.002.003.000.93

The Sharpe ratio of Bogleheads Four-fund Portfolio lies between the 25th and 75th percentiles. It indicates that the portfolio's risk-adjusted performance is in line with the majority of portfolios. This suggests a balanced approach to risk and return, which might be suitable for a broad range of investors.


Rolling 12-month Sharpe Ratio0.000.501.001.50JulyAugustSeptemberOctoberNovemberDecember
0.93
0.91
Bogleheads Four-fund Portfolio
Benchmark (^GSPC)
Portfolio components

Dividend yield

Bogleheads Four-fund Portfolio granted a 2.20% dividend yield in the last twelve months.


TTM20222021202020192018201720162015201420132012
Bogleheads Four-fund Portfolio2.20%2.17%2.04%1.71%2.38%2.60%2.18%2.35%2.33%2.48%2.11%2.44%
VTI
Vanguard Total Stock Market ETF
1.46%1.66%1.21%1.42%1.78%2.04%1.71%1.92%1.98%1.76%1.74%2.13%
BND
Vanguard Total Bond Market ETF
3.11%2.60%1.97%2.22%2.72%2.81%2.54%2.51%2.57%2.79%2.78%3.24%
VEA
Vanguard FTSE Developed Markets ETF
3.00%2.91%3.16%2.04%3.04%3.35%2.77%3.05%2.92%3.68%2.60%2.97%
BNDX
Vanguard Total International Bond ETF
2.10%1.51%3.74%1.11%3.40%3.01%2.23%1.89%1.63%1.54%0.86%0.00%

Expense Ratio

The Bogleheads Four-fund Portfolio has an expense ratio of 0.04% which is considered to be low. Below you can find the expense ratios of portfolio funds side-by-side and effortlessly compare their relative costs.


0.07%
0.00%2.15%
0.05%
0.00%2.15%
0.03%
0.00%2.15%

Risk-Adjusted Performance

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 ratioSortino ratioOmega ratioCalmar ratioUlcer Index
VTI
Vanguard Total Stock Market ETF
0.96
BND
Vanguard Total Bond Market ETF
0.27
VEA
Vanguard FTSE Developed Markets ETF
0.74
BNDX
Vanguard Total International Bond ETF
0.55

Asset Correlations Table

The table below displays the correlation coefficients between the individual components of the portfolio, the entire portfolio, and the chosen benchmark.

BNDXBNDVEAVTI
BNDX1.000.71-0.03-0.04
BND0.711.00-0.03-0.06
VEA-0.03-0.031.000.82
VTI-0.04-0.060.821.00

Drawdowns Chart

The Drawdowns chart displays portfolio losses from any high point along the way.


-14.00%-12.00%-10.00%-8.00%-6.00%-4.00%JulyAugustSeptemberOctoberNovemberDecember
-5.15%
-4.21%
Bogleheads Four-fund Portfolio
Benchmark (^GSPC)
Portfolio components

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.


Depth

Start

To Bottom

Bottom

To Recover

End

Total

-28.24%Feb 13, 202027Mar 23, 202099Aug 12, 2020126
-24.38%Nov 9, 2021233Oct 12, 2022
-15.13%Jan 29, 2018229Dec 24, 201875Apr 12, 2019304
-13.8%May 22, 2015183Feb 11, 2016117Jul 29, 2016300
-6.87%Jul 7, 201473Oct 16, 201427Nov 24, 2014100

Volatility Chart

The current Bogleheads Four-fund Portfolio volatility is 2.70%, representing the average percentage change in the investments's value, either up or down over the past month. The chart below shows the rolling one-month volatility.


2.50%3.00%3.50%4.00%4.50%5.00%JulyAugustSeptemberOctoberNovemberDecember
2.70%
2.79%
Bogleheads Four-fund Portfolio
Benchmark (^GSPC)
Portfolio components
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