Here is my monthly update of the trailing total returns for the major asset classes that I find useful. I am using passive ETFs to track asset classes, as they represent “real” investments that you can buy and sell. Return data was taken after market close at the end of October 2012.
| Asset Class Representative ETF Benchmark Index |
1-Mo | 1-Year | 5-Year | 10-Year |
| Broad US Stock Market Vanguard Total Stock Market (VTI) MSCI US Broad Market Index |
-1.75% | 14.75% | 1.57% | 8.73% |
| Broad International Stock Market Vanguard Total International Stock (VXUS) MSCI All Country World ex USA Investable Market Index |
0.56% | 5.43% | -5.49% | 8.90% |
| Emerging Markets Vanguard Emerging Markets ETF (VWO) MSCI Emerging Markets Index |
-0.41% | 3.47% | -3.94% | 15.80% |
| REIT (Real Estate) Vanguard REIT ETF (VNQ) MSCI US REIT Index |
-0.82% | 14.72% | 2.26% | 11.89% |
| Broad US Bond Market Vanguard Total Bond Market ETF (BND) Barclays U.S. Aggregate Float Adj. Bond Index |
0.11% | 4.99% | 6.35% | 5.39% |
| US Treasury Bonds – Short-Term iShares 1-3 Year Treasury Bond ETF (SHY) Barclays U.S. 1-3 Year Treasury Bond Index |
-0.06% | 0.30% | 2.58% | 2.66% |
| US Treasury Bonds – Long-Term iShares 20+ Year Treasury Bond ETF (TLT) Barclays U.S. 20+ Year Treasury Bond Index |
-0.12% | 10.97% | 10.82% | 8.21% |
| TIPS / Inflation-Linked Bonds iShares TIPS Bond ETF (TIP) Barclays U.S. TIPS Index |
0.83% | 7.85% | 7.72% | n/a |
| Gold SPDR Gold Shares (GLD) Price of Gold Bullion |
-3.25% | -0.57% | 16.38% | n/a |
Here is a chart of the 1-year trailing returns for the major asset classes above, which I use for rebalancing. Note that I do not necessarily invest in all the listed asset classes, see my personal portfolio for more details.
I’ve barely been investing for a decade, but this month I notice that all the 10-year returns look pretty good for all the asset classes. (The 2001 dot-com crash is now left out.) Is this why everyone seems to be pretty happy with the market right now? I wonder if the good times will last.
* Listed are total returns (includes dividends and interest) as calculated by Morningstar as of 10/31/12. All periods longer than one year are annualized. NAV returns are listed except in the case of GLD, as there is not a significant premium/discount to NAV for the other ETFs and the NAV returns match the equivalent Vanguard mutual fund returns. In certain cases, I am using the long-term returns of the equivalent Vanguard mutual funds as Vanguard ETFs are simply a different share class of the mutual funds, share the same underlying investments (VXUS/VTIAX, VWO/VEIEX, VNQ/VGLSX, BND/VBLTX).
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Wow in the past decade Emerging Markets ETF has outperformed Broad US Stock Market by almost 100%.
Gold has gone bonkers in the last five years. Good to see some reversal in the last month.
Thanks for putting so much time into this; I find your blog to be both informative and understandable.
Yes, thank you for putting in the work on this…but I believe things would look pretty ugly again (in certain sectors) if you had a *15 year* look back…the S&P 500 is still below where it was *12 years ago* and that is probably the most common benchmark out there.
Great post. You have a diversified portfolio. Perhaps adding commodities (besides gold) could further diversification. You can consider holding oil and soft commodities.