Aggressive Portfolio

The Aggressive Portfolio aims to grow your assets through capital appreciation. It may be suitable for people in their 20s and 30s, who have a very long investment horizon. The static portfolio targets 80% in risk assets such as equity, commodity, real estate and energy master trust and 20% in bonds as strategic long-term allocations. The dynamic portfolio has 80% in risk asset on average, though the allocations on risk assets vary across different stages of economic and market cycles.  Historically, this strategy delivered 15% annual return with a 15% drawdown. The following are the backtesting results based on monthly data since 1970.

Long Term Performance Compared to Benchmark (80% S&P 500 +20% Barclays Aggregate Bond Index)

Portfolio Composition in 12/2011

Equities Static Dynamic
SPY US Large Cap 15% 27%
IWM US Small Cap 15% 27%
EFA Developed Market Equity 15%
VWO Emerging Market Equity 15%
Dividend Assets
IYR US REIT 5%
AMJ US Energy Master Trust 5% 13%
Commodities
GLD Gold 5%
GSG Commodity 5%
Bonds
HYG US High Yield 5% 13%
AGG US Bond 5% 7%
TIP US Treasury Inflation Indexed Bond 5% 7%
IEF US Treasury Bond 5%
TLT US Long Term Treasury Bond 7%
SHY US Short Term Bond

Two-year Monthly Performance

Forty-year Annual Performance

Portfolio Performance Statistics

Static Dynamic Benchmark
Average Monthly Return 0.9% 1.2% 0.8%
Monthly Standard Deviation 3.3% 2.8% 3.7%
Annualized Return 10.5% 14.4% 10.0%
Annualized Standard Deviation 11.4% 9.7% 12.7%
Sharpe Ratio (Risk-free Rate =   5.5%) 0.4 0.9 0.4
Maximum Drawdown (Loss) 43% 15% 41%
Expected Time to Recover (yrs) 4.1 1.0 4.2

Current Portfolio Composition

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