Bogleheads Three-fund Portfolio
The three-fund portfolio is a portfolio popularized by Jack Bogle fans (boggleheads). It uses only three fundamental asset classes: a U.S total stock market fund, a total international stock market fund, and a total bond market fund. The portfolio could be replicated using three low-cost ETFs.
Asset Allocation
| Position | Category/Sector | Target Weight |
|---|---|---|
BND Vanguard Total Bond Market ETF | Total Bond Market | 20% |
VEA Vanguard FTSE Developed Markets ETF | Foreign Large Cap Equities | 30% |
VTI Vanguard Total Stock Market ETF | Large Cap Growth Equities | 50% |
Performance
Performance Chart
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The earliest data available for this chart is Jul 26, 2007, corresponding to the inception date of VEA
Returns By Period
As of May 11, 2025, the Bogleheads Three-fund Portfolio returned 2.35% Year-To-Date and 8.11% of annualized return in the last 10 years.
| YTD | 1M | 6M | 1Y | 5Y* | 10Y* | |
|---|---|---|---|---|---|---|
^GSPC S&P 500 | -3.77% | 7.44% | -5.60% | 8.37% | 14.12% | 10.46% |
| Bogleheads Three-fund Portfolio | 2.35% | 7.60% | 0.10% | 9.06% | 11.12% | 8.11% |
| Portfolio components: | ||||||
VTI Vanguard Total Stock Market ETF | -3.75% | 7.98% | -5.68% | 9.17% | 15.27% | 11.77% |
BND Vanguard Total Bond Market ETF | 2.21% | 0.98% | 1.19% | 5.53% | -0.78% | 1.51% |
VEA Vanguard FTSE Developed Markets ETF | 12.77% | 11.62% | 8.93% | 10.01% | 11.74% | 5.66% |
Monthly Returns
The table below presents the monthly returns of Bogleheads Three-fund Portfolio, with color gradation from worst to best to easily spot seasonal factors. Returns are adjusted for dividends.
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | Total | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2.97% | 0.17% | -2.83% | 0.90% | 1.21% | 2.35% | |||||||
| 2024 | 0.20% | 3.21% | 2.92% | -3.68% | 4.11% | 1.22% | 2.32% | 2.23% | 1.60% | -2.40% | 3.75% | -2.90% | 12.89% |
| 2023 | 6.83% | -2.78% | 2.68% | 1.44% | -1.14% | 4.68% | 2.75% | -2.29% | -4.04% | -2.64% | 8.25% | 5.04% | 19.40% |
| 2022 | -4.60% | -2.26% | 1.23% | -7.39% | 0.55% | -7.16% | 6.73% | -4.17% | -8.41% | 5.63% | 7.12% | -3.75% | -16.74% |
| 2021 | -0.55% | 1.99% | 2.43% | 3.61% | 1.32% | 1.14% | 1.26% | 1.79% | -3.46% | 4.31% | -2.09% | 3.11% | 15.60% |
| 2020 | -0.54% | -5.92% | -11.50% | 9.21% | 4.56% | 2.34% | 3.96% | 4.98% | -2.41% | -2.15% | 10.39% | 4.10% | 15.91% |
| 2019 | 6.74% | 2.50% | 1.26% | 2.81% | -4.48% | 5.51% | 0.13% | -1.06% | 1.69% | 2.08% | 2.30% | 2.48% | 23.76% |
| 2018 | 3.79% | -3.65% | -0.97% | 0.44% | 1.07% | -0.13% | 2.34% | 1.34% | 0.20% | -6.45% | 1.28% | -5.82% | -6.91% |
| 2017 | 2.07% | 2.28% | 0.95% | 1.35% | 1.68% | 0.67% | 1.89% | 0.25% | 1.88% | 1.61% | 1.76% | 1.19% | 19.05% |
| 2016 | -4.27% | -0.73% | 5.77% | 1.10% | 0.77% | -0.07% | 3.36% | 0.17% | 0.61% | -2.01% | 1.28% | 1.81% | 7.72% |
| 2015 | -0.67% | 4.41% | -0.84% | 1.40% | 0.53% | -1.94% | 1.47% | -5.27% | -2.45% | 6.00% | 0.00% | -1.75% | 0.38% |
| 2014 | -2.84% | 4.27% | 0.12% | 0.66% | 1.79% | 1.64% | -1.76% | 2.38% | -2.39% | 1.41% | 1.42% | -1.10% | 5.48% |
Expense Ratio
Bogleheads Three-fund Portfolio has an expense ratio of 0.04%, which is considered low. Below, you can find the expense ratios of the portfolio's funds side by side and easily compare their relative costs.
Risk-Adjusted Performance
Risk-Adjusted Performance Rank
The current rank of Bogleheads Three-fund Portfolio is 58, indicating average performance compared to other portfolios on our website. Here’s a breakdown of how it compares using common performance measures.
Risk-Adjusted Performance Indicators
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 | Martin ratio | |
|---|---|---|---|---|---|
VTI Vanguard Total Stock Market ETF | 0.47 | 0.83 | 1.12 | 0.51 | 1.94 |
BND Vanguard Total Bond Market ETF | 1.00 | 1.45 | 1.17 | 0.42 | 2.54 |
VEA Vanguard FTSE Developed Markets ETF | 0.59 | 1.00 | 1.13 | 0.80 | 2.42 |
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Dividends
Dividend yield
Bogleheads Three-fund Portfolio provided a 2.30% dividend yield over the last twelve months.
| TTM | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2.30% | 2.37% | 2.28% | 2.23% | 1.95% | 1.77% | 2.34% | 2.59% | 2.19% | 2.38% | 2.38% | 2.54% |
| Portfolio components: | ||||||||||||
VTI Vanguard Total Stock Market ETF | 1.35% | 1.27% | 1.44% | 1.67% | 1.21% | 1.42% | 1.78% | 2.04% | 1.71% | 1.92% | 1.98% | 1.76% |
BND Vanguard Total Bond Market ETF | 3.75% | 3.67% | 3.09% | 2.60% | 1.97% | 2.22% | 2.72% | 2.81% | 2.54% | 2.51% | 2.57% | 2.79% |
VEA Vanguard FTSE Developed Markets ETF | 2.91% | 3.36% | 3.16% | 2.91% | 3.16% | 2.04% | 3.04% | 3.35% | 2.77% | 3.05% | 2.92% | 3.68% |
Drawdowns
Drawdowns Chart
The Drawdowns chart displays portfolio losses from any high point along the way. Drawdowns are calculated considering price movements and all distributions paid, if any.
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Worst Drawdowns
The table below displays the maximum drawdowns of the Bogleheads Three-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 Three-fund Portfolio was 47.74%, occurring on Mar 9, 2009. Recovery took 539 trading sessions.
The current Bogleheads Three-fund Portfolio drawdown is 2.45%.
Depth | Start | To Bottom | Bottom | To Recover | End | Total |
|---|---|---|---|---|---|---|
| -47.74% | Nov 1, 2007 | 339 | Mar 9, 2009 | 539 | Apr 27, 2011 | 878 |
| -28.12% | Feb 13, 2020 | 27 | Mar 23, 2020 | 95 | Aug 6, 2020 | 122 |
| -24.47% | Nov 9, 2021 | 235 | Oct 14, 2022 | 329 | Feb 7, 2024 | 564 |
| -17.25% | May 2, 2011 | 108 | Oct 3, 2011 | 111 | Mar 13, 2012 | 219 |
| -15.25% | Jan 29, 2018 | 229 | Dec 24, 2018 | 81 | Apr 23, 2019 | 310 |
Volatility
Volatility Chart
The chart below shows the rolling one-month volatility.
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Diversification
Diversification Metrics
Number of Effective Assets
The portfolio contains 3 assets, with an effective number of assets of 2.63, reflecting the diversification based on asset allocation. This number of effective assets suggests a highly concentrated portfolio, where a few assets dominate the allocation, potentially increasing the portfolio's risk due to lack of diversification.
Asset Correlations Table
| ^GSPC | BND | VEA | VTI | Portfolio | |
|---|---|---|---|---|---|
| ^GSPC | 1.00 | -0.16 | 0.83 | 0.99 | 0.96 |
| BND | -0.16 | 1.00 | -0.10 | -0.16 | -0.08 |
| VEA | 0.83 | -0.10 | 1.00 | 0.83 | 0.94 |
| VTI | 0.99 | -0.16 | 0.83 | 1.00 | 0.97 |
| Portfolio | 0.96 | -0.08 | 0.94 | 0.97 | 1.00 |