PortfoliosLab logo
Tools
Performance Analysis
Risk Analysis
Optimization
Factor Model
See All Tools
Portfolio Analysis
Portfolios
Lazy PortfoliosUser Portfolios
Discussions

Bogleheads Three-fund Portfolio

Last updated Dec 9, 2023

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


BND 20%VTI 50%VEA 30%BondBondEquityEquity
PositionCategory/SectorWeight
BND
Vanguard Total Bond Market ETF
Total Bond Market20%
VTI
Vanguard Total Stock Market ETF
Large Cap Growth Equities50%
VEA
Vanguard FTSE Developed Markets ETF
Foreign Large Cap Equities30%

Performance

The chart shows the growth of an initial investment of $10,000 in Bogleheads Three-fund 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


150.00%160.00%170.00%180.00%190.00%200.00%210.00%JulyAugustSeptemberOctoberNovemberDecember
174.53%
210.55%
Bogleheads Three-fund Portfolio
Benchmark (^GSPC)
Portfolio components

The earliest data available for this chart is Jul 26, 2007, corresponding to the inception date of VEA

Returns

As of Dec 9, 2023, the Bogleheads Three-fund Portfolio returned 14.75% Year-To-Date and 7.46% of annualized return in the last 10 years.


Year-To-Date1 month6 months1 year5 years (annualized)10 years (annualized)
^GSPC
N/AN/AN/AN/AN/AN/A
Bogleheads Three-fund Portfolio14.75%4.97%4.62%12.60%9.06%7.60%
VTI
Vanguard Total Stock Market ETF
21.08%5.90%7.78%17.27%13.03%11.32%
BND
Vanguard Total Bond Market ETF
2.87%2.79%0.64%0.66%0.71%1.42%
VEA
Vanguard FTSE Developed Markets ETF
12.52%6.12%2.03%11.03%6.88%4.40%

Monthly Returns Heatmap


JanFebMarAprMayJunJulAugSepOctNovDec
2023-1.14%4.68%2.75%-2.29%-4.04%-2.64%8.24%

Sharpe Ratio

The current Bogleheads Three-fund Portfolio Sharpe ratio is 1.14. A Sharpe ratio greater than 1.0 is considered acceptable.

-1.000.001.002.003.001.14

The Sharpe ratio of Bogleheads Three-fund Portfolio lies between the 25th and 75th percentiles. It indicates that the portfolio's risk-adjusted performance is in line with the majority of portfolios. This suggests a balanced approach to risk and return, which might be suitable for a broad range of investors.


Rolling 12-month Sharpe Ratio0.000.501.001.50JulyAugustSeptemberOctoberNovemberDecember
1.14
1.25
Bogleheads Three-fund Portfolio
Benchmark (^GSPC)
Portfolio components

Dividend yield

Bogleheads Three-fund Portfolio granted a 2.25% dividend yield in the last twelve months.


TTM20222021202020192018201720162015201420132012
Bogleheads Three-fund Portfolio2.25%2.23%1.95%1.77%2.34%2.59%2.19%2.38%2.38%2.54%2.21%2.61%
VTI
Vanguard Total Stock Market ETF
1.46%1.66%1.21%1.42%1.78%2.04%1.71%1.92%1.98%1.76%1.74%2.13%
BND
Vanguard Total Bond Market ETF
3.11%2.60%1.97%2.22%2.72%2.81%2.54%2.51%2.57%2.79%2.78%3.24%
VEA
Vanguard FTSE Developed Markets ETF
3.00%2.91%3.16%2.04%3.04%3.35%2.77%3.05%2.92%3.68%2.60%2.97%

Expense Ratio

The Bogleheads Three-fund 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.


0.05%
0.00%2.15%
0.03%
0.00%2.15%

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 ratioSortino ratioOmega ratioCalmar ratioUlcer Index
VTI
Vanguard Total Stock Market ETF
1.30
BND
Vanguard Total Bond Market ETF
0.05
VEA
Vanguard FTSE Developed Markets ETF
0.83

Asset Correlations Table

The table below displays the correlation coefficients between the individual components of the portfolio, the entire portfolio, and the chosen benchmark.

BNDVEAVTI
BND1.00-0.14-0.19
VEA-0.141.000.84
VTI-0.190.841.00

Drawdowns Chart

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


-14.00%-12.00%-10.00%-8.00%-6.00%-4.00%JulyAugustSeptemberOctoberNovemberDecember
-5.27%
-4.01%
Bogleheads Three-fund Portfolio
Benchmark (^GSPC)
Portfolio components

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.


Depth

Start

To Bottom

Bottom

To Recover

End

Total

-47.74%Nov 1, 2007339Mar 9, 2009539Apr 27, 2011878
-28.12%Feb 13, 202027Mar 23, 202095Aug 6, 2020122
-24.47%Nov 9, 2021235Oct 14, 2022
-17.25%May 2, 2011108Oct 3, 2011111Mar 13, 2012219
-15.25%Jan 29, 2018229Dec 24, 201881Apr 23, 2019310

Volatility Chart

The current Bogleheads Three-fund Portfolio volatility is 2.58%, 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.


2.50%3.00%3.50%4.00%4.50%5.00%JulyAugustSeptemberOctoberNovemberDecember
2.58%
2.77%
Bogleheads Three-fund Portfolio
Benchmark (^GSPC)
Portfolio components
0 comments