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Second Grader's Starter Portfolio

Last updated Aug 13, 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

0.04%
0.00%0.94%
Dividend Yield

Rank 20 of 54

2.16%
0.00%4.34%
10Y Annualized Return

Rank 17 of 54

11.20%
4.13%64.70%
Sharpe Ratio

Rank 24 of 54

-0.35
-0.980.14
Maximum Drawdown

Rank 42 of 54

-32.89%
-91.88%-17.74%

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 $31,504 for a total return of roughly 215.04%. All prices are adjusted for splits and dividends. The portfolio is rebalanced Quarterly


-15.00%-10.00%-5.00%0.00%5.00%MarchAprilMayJuneJulyAugust
-5.02%
-2.76%
Second Grader's Starter Portfolio
Benchmark (^GSPC)
Portfolio components

Second Grader's Starter PortfolioReturns

As of Aug 13, 2022, the Second Grader's Starter Portfolio returned -10.65% Year-To-Date and 11.20% of annualized return in the last 10 years.


1M6MYTD1Y5Y10Y
Benchmark12.08%-4.97%-10.20%-3.65%11.89%11.81%
Second Grader's Starter Portfolio10.22%-6.87%-10.80%-8.12%9.35%10.09%
VTI
Vanguard Total Stock Market ETF
12.82%-4.78%-10.34%-4.99%13.37%13.68%
BND
Vanguard Total Bond Market ETF
1.49%-4.92%-8.75%-9.37%0.97%1.54%
VEU
Vanguard FTSE All-World ex-US ETF
7.95%-11.91%-12.82%-14.30%3.63%5.38%

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 -0.35. 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.


-1.00-0.500.000.501.00MarchAprilMayJuneJulyAugust
-0.46
-0.20
Second Grader's Starter Portfolio
Benchmark (^GSPC)
Portfolio components

Second Grader's Starter PortfolioDividends

Second Grader's Starter Portfolio granted a 2.16% dividend yield in the last twelve months.


PeriodTTM202120202019201820172016201520142013201220112010

Dividend yield

2.16%1.87%1.73%2.39%2.68%2.30%2.59%2.70%2.86%2.59%3.10%3.27%2.75%

Second Grader's Starter PortfolioDrawdowns Chart

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


-20.00%-15.00%-10.00%-5.00%0.00%SeptemberOctoberNovemberDecember2022FebruaryMarchAprilMayJuneJulyAugust
-11.57%
-10.77%
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.


Depth

Start

To Bottom

Bottom

To Recover

End

Total

-31.07%Feb 13, 202027Mar 23, 202099Aug 12, 2020126
-21.69%Nov 9, 2021152Jun 16, 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 10.32%. 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.


10.00%15.00%20.00%25.00%30.00%35.00%40.00%MarchAprilMayJuneJulyAugust
15.00%
16.68%
Second Grader's Starter Portfolio
Benchmark (^GSPC)
Portfolio components

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