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 $10,000 invested in Second Grader's Starter Portfolio in Oct 2022 and compares it to the S&P 500 index or another benchmark. It would be worth nearly $26,913 for a total return of roughly 169.13%. All prices are adjusted for splits and dividends. The portfolio is rebalanced Quarterly
Returns
As of Mar 25, 2023, the Second Grader's Starter Portfolio returned 3.47% Year-To-Date and 8.39% of annualized return in the last 10 years.
| 1 month | Year-To-Date | 6 months | 1 year | 5 years (annualized) | 10 years (annualized) | |
|---|---|---|---|---|---|---|
| Benchmark | 0.19% | 3.59% | 7.70% | -12.45% | 8.78% | 9.76% |
| Second Grader's Starter Portfolio | -0.10% | 3.67% | 10.25% | -9.51% | 6.93% | 8.31% |
| Portfolio components: | ||||||
VTI Vanguard Total Stock Market ETF | -0.63% | 3.68% | 8.10% | -11.95% | 9.89% | 11.33% |
BND Vanguard Total Bond Market ETF | 2.28% | 2.65% | 3.36% | -4.29% | 0.80% | 1.24% |
VEU Vanguard FTSE All-World ex-US ETF | 0.17% | 3.97% | 16.76% | -6.96% | 2.36% | 4.18% |
| Returns over 1 year are annualized | ||||||
Dividends
Second Grader's Starter Portfolio granted a 2.48% dividend yield in the last twelve months.
| Period | TTM | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dividend yield | 2.48% | 2.20% | 1.90% | 1.75% | 2.43% | 2.73% | 2.33% | 2.64% | 2.75% | 2.90% | 2.63% | 3.15% |
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 |
| -9.15% | Jul 16, 2007 | 24 | Aug 16, 2007 | 31 | Oct 1, 2007 | 55 |
| -7.59% | Sep 8, 2014 | 29 | Oct 16, 2014 | 26 | Nov 21, 2014 | 55 |
| -7.17% | May 22, 2013 | 23 | Jun 24, 2013 | 19 | Jul 22, 2013 | 42 |
| -7.06% | Sep 3, 2020 | 14 | Sep 23, 2020 | 31 | Nov 5, 2020 | 45 |
| -6.13% | Sep 17, 2012 | 42 | Nov 15, 2012 | 22 | Dec 18, 2012 | 64 |
Volatility Chart
Current Second Grader's Starter Portfolio volatility is 11.15%. The chart below shows the rolling 10-day volatility. Volatility is a statistical measure showing how big price swings are in either direction. The higher asset volatility, the riskier it is, because the price movements are less predictable.