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The traditional balanced portfolio — 60% equities, 40% bonds and cash.
Equities (60%)
The growth engine. Large companies like Apple, Microsoft, and JPMorgan. Historically returns ~10% per year but can drop 50% in a crisis.
Fixed Income (30%)
The shock absorber. Government and corporate debt that typically rises when stocks fall. Returns ~5% per year with much less volatility.
Cash (10%)
The safety net. Treasury bills and money market funds. Returns barely beat inflation but never lose value.
8.5%per year
60/40 Classic turned $10,000 into $174,255 over 35 years.
CAGRCompound Annual Growth Rate — the average yearly return over the full period. Benchmark: S&P 500 ~10%, 60/40 ~8%, Bonds ~5%.
8.51%
Annualized returnYour money doubled roughly every 8.5 years.Max DrawdownThe worst peak-to-trough decline. Benchmark: S&P 500 hit -51% in 2008; a 60/40 portfolio saw -30%. Lower is better.
-20.48%
Worst peak-to-troughIn the worst period, you would have temporarily lost about 1 in 5 dollars.Sharpe RatioRisk-adjusted return per unit of volatility. Benchmark: S&P 500 ~0.5, 60/40 ~0.6. Above 1.0 is excellent.
0.65
Risk-adjusted returnModerate risk-adjusted returns — reasonable compensation for risk.VolatilityAnnualized standard deviation of returns. Benchmark: S&P 500 ~15%, Bonds ~5%, 60/40 ~10%. Lower = smoother ride.
10.87%
Annualized std devModerate swings — expect some turbulence but manageable.Win RatePercentage of calendar years with positive returns. Benchmark: S&P 500 wins ~73% of years, 60/40 ~80%.
83.00%
29+ / 6−This portfolio made money in about 3 out of every 4 years.Best YearThe single best calendar-year return. Benchmark: S&P 500 best was +54% (1933), 60/40 best ~+28%.
+28.7%
1995Exceptional upside potential in the best years.Worst YearThe single worst calendar-year return. Benchmark: S&P 500 worst was -43% (1931), 60/40 worst ~-22%.
-20.5%
2008Painful worst years — requires conviction to hold through.SortinoLike Sharpe but only penalizes downside volatility. Benchmark: S&P 500 ~0.7, 60/40 ~0.8. Above 1.0 is strong.
0.97
Downside risk-adj.Strong downside protection — losses were well managed.$174,255(1643% total return)35 years
- Portfolio
- S&P 500
- 60/40 Benchmark
How would 60/40 Classic have performed during major market crises?
2008 GFC-20.5%
COVID 2020-17.7%
Dot-Com 2000-25.6%
1994 Bond Crash+0.3%
2022 Rate Hikes-14.6%