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. See August 2012 asset class returns for additional background and comparison.
| Asset Class|
| Broad US Stock Market|
Vanguard Total Stock Market (VTI)
MSCI US Broad Market Index
| Broad International Stock Market|
Vanguard Total International Stock (VXUS)
MSCI All Country World ex USA Investable Market Index
| Emerging Markets|
Vanguard Emerging Markets ETF (VWO)
MSCI Emerging Markets Index
| REIT (Real Estate)|
Vanguard REIT ETF (VNQ)
MSCI US REIT Index
| Broad US Bond Market|
Vanguard Total Bond Market ETF (BND)
Barclays U.S. Aggregate Float Adj. Bond Index
| US Treasury Bonds – Short-Term|
iShares 1-3 Year Treasury Bond ETF (SHY)
Barclays U.S. 1-3 Year Treasury Bond Index
| US Treasury Bonds – Long-Term|
iShares 20+ Year Treasury Bond ETF (TLT)
Barclays U.S. 20+ Year Treasury Bond Index
| TIPS / Inflation-Linked Bonds|
iShares TIPS Bond ETF (TIP)
Barclays U.S. TIPS Index
SPDR Gold Shares (GLD)
Price of Gold Bullion
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.
Looks like nearly all asset classes are up from a year ago. Indeed, the US stock market is up over 30% from a year ago… find a guru or economist that predicted that! Over the past 10 years, the US stock market had an a 8.59% annualized return. The hyped “lost decade” looks a lot different once you simply move your timeframe a few years. The longer I invest, the less I pay attention to short-term market predictions from anyone.
* Listed are total returns (includes dividends and interest) as calculated by Morningstar as of 8/31/12. 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).