Glidepath

 

 

25% Stocks

 

50% Stocks

 

65% Stocks

 

75% Stocks

 

100% Stocks

 

 

1973-1997 Models

 

Annual
Return
(%)

 

Annual
Risk
(%)
25% Stocks

Growth & Value, 50% U.S.

 

11.5

 

7.6

Value-Only, 50% U.S.

 

12.0

 

7.7

Growth & Value, 60% U.S.

 

11.5

 

7.6

Value-Only, 60% U.S.

 

12.0

 

7.7

Growth & Value, 70% U.S.

 

11.5

 

7.6

Value-Only, 70% U.S.

 

12.0

 

7.7

 

50% Stocks    

Growth & Value, 50% U.S.

 

12.9

 

10.2

Value-Only, 50% U.S.

 

14.0

 

10.5

Growth & Value, 60% U.S.

 

13.0

 

10.0

Value-Only, 60% U.S.

 

14.0

 

10.3

Growth & Value, 70% U.S.

 

13.1

 

10.0

Value-Only, 70% U.S.

 

14.0

 

10.2

 

65% Stocks    

Growth & Value, 50% U.S.

 

13.7

 

12.2

Value-Only, 50% U.S.

 

15.1

 

12.6

Growth & Value, 60% U.S.

 

13.8

 

12.1

Value-Only, 60% U.S.

 

15.1

 

12.3

Growth & Value, 70% U.S.

 

13.9

 

12.1

Value-Only, 70% U.S.

 

15.1

 

12.2

 

75% Stocks    

Growth & Value, 50% U.S.

 

14.1

 

13.8

Value-Only, 50% U.S.

 

15.8

 

14.2

Growth & Value, 60% U.S.

 

14.3

 

13.5

Value-Only, 60% U.S.

 

15.8

 

13.8

Growth & Value, 70% U.S.

 

14.4

 

13.5

Value-Only, 70% U.S.

 

15.9

 

13.6

 

100% Stocks    

Growth & Value, 50% U.S.

 

15.2

 

17.7

Value-Only, 50% U.S.

 

17.4

 

18.1

Growth & Value, 60% U.S.

 

15.4

 

17.4

Value-Only, 60% U.S.

 

17.5

 

17.6

Growth & Value, 70% U.S.

 

15.6

 

17.3

Value-Only, 70% U.S.

 

17.5

 

17.4

 

 

* Standard deviation of annual returns

Due to longer returns series back to 1973, the DFA Five-Year Government Bond index was used as a proxy for Global Fixed Income and the Morgan Stanley EAFE index was used for 1973 and 1974 as a proxy for International Large Value Stocks.

By law, advisors must state something like the following: "Past performance is no guarantee of future returns. This is especially true of model portfolios, which are not subject to specific economic and market factors."

We'll be more blunt: If you think you will realize these same returns over the next 25 years, especially factoring in advisor fees, fund expenses, and transaction costs, you may have an unpleasant surprise coming!

Enjoy!

IndexFunds.com Staff