Second Grader's Starter Portfolio
Second Grader's Starter Portfolio is a lazy portfolio by Paul Farrell. It is designed as a simple portfolio to follow for beginner investors with small capital and long investment horizon. Farrell gives an example of a second-grader who received a $10,000 gift from his grandmother.
Asset Allocation
| Position | Category/Sector | Weight |
|---|---|---|
BND Vanguard Total Bond Market ETF | Total Bond Market | 10% |
VTI Vanguard Total Stock Market ETF | Large Cap Growth Equities | 60% |
VEU Vanguard FTSE All-World ex-US ETF | Foreign Large Cap Equities | 30% |
Performance
The chart shows the growth of an initial investment of $10,000 in Second Grader's Starter 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
Returns
As of Oct 3, 2023, the Second Grader's Starter Portfolio returned 8.40% Year-To-Date and 7.97% of annualized return in the last 10 years.
| 1 month | 6 months | Year-To-Date | 1 year | 5 years (annualized) | 10 years (annualized) | |
|---|---|---|---|---|---|---|
| Benchmark | -5.04% | 4.58% | 11.69% | 16.58% | 8.16% | 9.78% |
| Second Grader's Starter Portfolio | -4.90% | 1.54% | 8.40% | 15.33% | 6.69% | 7.97% |
| Portfolio components: | ||||||
VTI Vanguard Total Stock Market ETF | -5.24% | 5.14% | 12.23% | 17.16% | 9.22% | 11.17% |
BND Vanguard Total Bond Market ETF | -2.68% | -5.46% | -1.58% | -0.80% | 0.09% | 1.02% |
VEU Vanguard FTSE All-World ex-US ETF | -4.93% | -3.22% | 4.18% | 16.87% | 3.12% | 3.48% |
| Returns over 1 year are annualized | ||||||
Monthly Returns Heatmap
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2023 | 2.74% | 1.27% | -0.88% | 5.41% | 3.32% | -2.55% | -4.12% |
Dividend yield
Second Grader's Starter Portfolio granted a 2.22% dividend yield in the last twelve months.
| TTM | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Second Grader's Starter Portfolio | 2.22% | 2.23% | 1.93% | 1.78% | 2.46% | 2.76% | 2.36% | 2.67% | 2.78% | 2.94% | 2.66% | 3.19% |
| Portfolio components: | ||||||||||||
VTI Vanguard Total Stock Market ETF | 1.58% | 1.68% | 1.25% | 1.48% | 1.88% | 2.21% | 1.88% | 2.15% | 2.27% | 2.06% | 2.07% | 2.58% |
BND Vanguard Total Bond Market ETF | 3.12% | 2.66% | 2.06% | 2.37% | 2.97% | 3.16% | 2.94% | 2.98% | 3.13% | 3.47% | 3.57% | 4.27% |
VEU Vanguard FTSE All-World ex-US ETF | 3.20% | 3.18% | 3.23% | 2.16% | 3.44% | 3.74% | 3.14% | 3.60% | 3.70% | 4.53% | 3.54% | 4.02% |
Expense Ratio
The Second Grader's Starter 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.
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 ratio | Sortino ratio | Omega ratio | Calmar ratio | Ulcer Index | |
|---|---|---|---|---|---|
VTI Vanguard Total Stock Market ETF | 1.07 | ||||
BND Vanguard Total Bond Market ETF | -0.03 | ||||
VEU Vanguard FTSE All-World ex-US ETF | 1.16 |
Asset Correlations Table
| BND | VEU | VTI | |
|---|---|---|---|
| BND | 1.00 | -0.15 | -0.20 |
| VEU | -0.15 | 1.00 | 0.85 |
| VTI | -0.20 | 0.85 | 1.00 |
Drawdowns Chart
The Drawdowns chart displays portfolio losses from any high point along the way.
Worst Drawdowns
The table below shows the maximum drawdowns of the Second Grader's Starter Portfolio. A maximum drawdown is an indicator of risk. It shows a reduction in portfolio value from its maximum due to a series of losing trades.
The maximum drawdown since January 2010 for the Second Grader's Starter Portfolio is 52.66%, recorded on Mar 9, 2009. It took 884 trading sessions for the portfolio to recover.
Depth | Start | To Bottom | Bottom | To Recover | End | Total |
|---|---|---|---|---|---|---|
| -52.66% | Nov 1, 2007 | 339 | Mar 9, 2009 | 884 | Sep 7, 2012 | 1223 |
| -31.07% | Feb 13, 2020 | 27 | Mar 23, 2020 | 99 | Aug 12, 2020 | 126 |
| -25.11% | Nov 9, 2021 | 235 | Oct 14, 2022 | — | — | — |
| -16.87% | Jan 29, 2018 | 229 | Dec 24, 2018 | 81 | Apr 23, 2019 | 310 |
| -16.3% | May 22, 2015 | 183 | Feb 11, 2016 | 126 | Aug 11, 2016 | 309 |
Volatility Chart
The current Second Grader's Starter Portfolio volatility is 2.76%, 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.