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Second Grader's Starter Portfolio

Last updated Dec 3, 2022

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.

Expense Ratio

Rank 21 of 54

Dividend Yield

Rank 24 of 54

10Y Annualized Return

Rank 16 of 54

Sharpe Ratio

Rank 16 of 54

Maximum Drawdown

Rank 41 of 54


Second Grader's Starter PortfolioAsset Allocation

Second Grader's Starter PortfolioPerformance

The chart shows the growth of $10,000 invested in Second Grader's Starter Portfolio in Jan 2010 and compares it to the S&P 500 index or another benchmark. It would be worth nearly $30,499 for a total return of roughly 204.99%. All prices are adjusted for splits and dividends. The portfolio is rebalanced Quarterly

Second Grader's Starter Portfolio
Benchmark (^GSPC)
Portfolio components

Second Grader's Starter PortfolioReturns

As of Dec 3, 2022, the Second Grader's Starter Portfolio returned -14.22% Year-To-Date and 10.46% of annualized return in the last 10 years.

Second Grader's Starter Portfolio7.52%-2.28%-13.64%-9.90%7.08%9.42%
Vanguard Total Stock Market ETF
Vanguard Total Bond Market ETF
Vanguard FTSE All-World ex-US ETF

Second Grader's Starter PortfolioSharpe Ratio Chart

The Sharpe ratio shows whether the portfolio's excess returns are due to smart investment decisions or a result of taking a higher risk. The higher a portfolio's Sharpe ratio, the better its risk-adjusted performance.

The current Second Grader's Starter Portfolio Sharpe ratio is -0.50. A negative Sharpe ratio means that the risk-free rate is higher than the portfolio's return. This value does not convey any meaningful information.

The chart below displays rolling 12-month Sharpe Ratio.

Second Grader's Starter Portfolio
Benchmark (^GSPC)
Portfolio components

Second Grader's Starter PortfolioDividends

Second Grader's Starter Portfolio granted a 2.19% dividend yield in the last twelve months.


Dividend yield


Second Grader's Starter PortfolioDrawdowns Chart

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

Second Grader's Starter Portfolio
Benchmark (^GSPC)
Portfolio components

Second Grader's Starter PortfolioWorst 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 31.07%, recorded on Mar 23, 2020. It took 99 trading sessions for the portfolio to recover.



To Bottom


To Recover



-31.07%Feb 13, 202027Mar 23, 202099Aug 12, 2020126
-25.11%Nov 9, 2021235Oct 14, 2022
-20.16%May 2, 2011108Oct 3, 2011115Mar 19, 2012223
-16.87%Jan 29, 2018229Dec 24, 201881Apr 23, 2019310
-16.3%May 22, 2015183Feb 11, 2016126Aug 11, 2016309
-13.91%Apr 16, 201055Jul 2, 201071Oct 13, 2010126
-10.54%Mar 27, 201247Jun 1, 201267Sep 6, 2012114
-8.61%Jan 20, 201014Feb 8, 201025Mar 16, 201039
-7.59%Sep 8, 201429Oct 16, 201426Nov 21, 201455
-7.17%May 22, 201323Jun 24, 201319Jul 22, 201342

Second Grader's Starter PortfolioVolatility Chart

Current Second Grader's Starter Portfolio volatility is 6.80%. 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.

Second Grader's Starter Portfolio
Benchmark (^GSPC)
Portfolio components