Investment Returns By Asset Class – March 2013 Update

Here is my monthly update of the trailing total returns for the major asset classes that I find useful. Passive ETFs are used to represent major asset classes, as they represent actual investments that folks can buy and sell. Return data was taken after market close at the end of February 2013.

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
1.29% 13.89% 5.62% 9.12%
Broad International Stock Market
Vanguard Total International Stock (VXUS)
MSCI All Country World ex USA Investable Market Index
-1.20% 6.98% -0.93% 10.33%
Emerging Markets
Vanguard Emerging Markets ETF (VWO)
FTSE Emerging Index
-1.73% 0.14% 0.34% 16.60%
REIT (Real Estate)
Vanguard REIT ETF (VNQ)
MSCI US REIT Index
1.23% 17.36% 8.00% 12.34%
Broad US Bond Market
Vanguard Total Bond Market ETF (BND)
Barclays U.S. Aggregate Float Adj. Bond Index
0.51% 3.09% 5.41% 5.46%
US Treasury Bonds – Short-Term
iShares 1-3 Year Treasury Bond ETF (SHY)
Barclays U.S. 1-3 Year Treasury Bond Index
0.07% 0.43% 1.65% 2.58%
US Treasury Bonds – Long-Term
iShares 20+ Year Treasury Bond ETF (TLT)
Barclays U.S. 20+ Year Treasury Bond Index
1.29% 3.24% 8.62% 7.17%
TIPS / Inflation-Linked Bonds
iShares TIPS Bond ETF (TIP)
Barclays U.S. TIPS Index
0.01% 4.06% 5.66% 5.9%
(est.)
Gold
SPDR Gold Shares (GLD)
Price of Gold Bullion
-4.61% -10.62% 9.90% 15.9%
(est.)

For an easy visual comparison, here is a chart of the 1-year trailing returns:

March 2013 Trailing 1-year Returns

I like collecting this information because it allows me to keep an eye on the market while still keeping the long-term returns in perspective. Often, the asset classes with the best long-term returns have had recent poor performance. The 1-year chart helps me decide where to invest new funds and also for rebalancing. Note that I do not necessarily invest in all the listed asset classes, see my personal portfolio for details.

* Listed are total returns (includes dividends and interest) as calculated by Morningstar as of 2/28/13. All periods longer than one year are annualized. NAV returns are listed, as there is not a significant premium/discount to NAV (except for GLD) 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 and thus share the same underlying investments (VXUS/VTIAX, VWO/VEMAX, VNQ/VGLSX, BND/VBLTX).

**10-Year returns for TIP are estimated using Barclays US Treasury Inflation Protected Index (tracked here) minus 0.20% expense ratio. 10-Year returns for GLD are estimated using spot price of gold from Kitco minus 0.40% expense ratio.

Comments

  1. For my portfolio, emerging markets sector (the fund that i chose) is relatively well compared to Large Value Domestic Funds I had chosen. Have you thought about buying shares in another non-Vanguard emerging markets etfs?

    I’m glad I didn’t buy much of gold as much as my co-workers did (i didn’t have the cash for one thing). There were even gold buying parties….

  2. I am curious about your college saving portfolio (for your infant).

    I am guessing the portfolio would look different than your retirement portfolio since the investment period is fixed (<= 18 years) and all the funds need to be spent in 4 years.

    I am wondering what investment vehicles (Coverdell ESA/ 529/ UTMA) you chose and the investment mix.

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