Originally Posted by Walkinwood
I want to model my portfolio & am looking for information on average nominal rates of return & standard deviation for different asset classes like
domestic large cap
domestic small cap
international etc. etc.
Does anyone have a link or information handy?
If you were to make a guess on the average nominal (before inflation) rate of return for a portfolio that was 75 % equity (mix of large, small & international) & 25% short term bonds & cash, what would that be? I have guessed at 6%, but I'm beginning to think that's too conservative.
my anecdotal guesses going forward
100% equity 10-12% annual return, with returns as low as -30% and gains as much as +40% (assuming minimums of 45% large cap domestic, and small cap is around 15%.)
80-20 8-10% annual returns, with returns as low as -20% and gains as much as 30%. (Assuming minimum of 40% domestic large caps and 10% small caps)
60-40 6-8% returns, with low of -5% and highs around 12%.
40-60 4-6% returns, with most years being positive. Low of -1%, high of around 8-10%. Assume in this situation the equity position is primarily US large cap domestic.
small caps have long term returns of 12%, but the volatility of that is much higher than the large cap returns- large caps generally return around 9-10%.