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The New 60/40 Portfolio

By Michael Batnick, CFA
The Irrelevant Investor, LLC

The 60/40 portfolio has one of the best track records over the past 50 years.

It has had positive returns 82% of the time over rolling 1-year periods, 93% of the time over rolling 3-year periods, and 99.4% of the time over rolling 5-year periods.

It fell 20% or more in a year just one time, gained 20% or more in a year 10 different times, and had an average annual return of 10.7%.

The returns were driven not just by stocks, but also by bonds, which had an average annual return of 7.5% from 1976-2019.

Over the last 44 years, it gained over 7,000%, and had a maximum drawdown of just 30%. But that was then, and this is now.

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The New 60/40 Portfolio