Join Early Retirement Today
Thread Tools Search this Thread Display Modes
A portfolio with consistent annual market growth of ...
Old 11-01-2009, 05:11 PM   #1
Thinks s/he gets paid by the post
Rustward's Avatar
Join Date: Apr 2006
Posts: 1,607
A portfolio with consistent annual market growth of ...

I was comparing FireCalc to another calculator, and to get apples and apples on the 'Your Portfolio' tab selected 'A portfolio with consistent annual market growth of n%, fixed income returns of m%, and an inflation rate of x%' because that is all the other calculator supports. While I realize this is probably not the way FireCalc was intended to be used, it's the only way I can make a valid comparison.

How does FireCalc know how much I have in the market vs. fixed income when 'A portfolio with consistent annual market growth of ...' is selected?

Rustward is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 11-01-2009, 06:07 PM   #2
Moderator Emeritus
W2R's Avatar
Join Date: Jan 2007
Location: New Orleans
Posts: 40,169
I don't think it does. It just assumes that whatever the equity/bond percentages, you get the annual market growth and yield that you specify.

If you want to specify the percentages, and let Firecalc figure out what you get out of it, you would choose "Total Market" or "Mixed Portfolio".

5/17/2018: Retired a second time, this time from my volunteer Admin duties. After 10 years of being on the team, and 40,000+ posts, the time just seemed right. It has been such fun to work with all of our Mods and Admins and I plan to stick around as a regular member.
W2R is offline   Reply With Quote
Old 11-09-2009, 12:01 PM   #3
Thinks s/he gets paid by the post
Rustward's Avatar
Join Date: Apr 2006
Posts: 1,607
It appears that FireCalc completely ignores what you enter for the market growth percentage, and treats the entire starting amount like fixed income applying what you enter in "Fixed income returns of ...".

Here is how to see it:
Start with default settings: Spending 30000, Portfolio 750000, Years 30.

Change spending to 0.

Go to the Your Portfolio Tab.

Set the investment expense ratio to 0.

Click "A portfolio with consistent annual growth of".

Set the annual growth percentage to a non-zero number of your choice -- 1, 10, 100, 1000 -- it won't affect the outcome.

Set fixed income returns to 0%.

Set inflation to 0%.

Submit. Look at the results graph. The portfolio value does not change.

Now, change the fixed income returns to something predictable. A consistent return of 7.2% should roughly double the portfolio every 10 years. Look at the result. It doubles every 10 years.

Am I missing something?

Rustward is offline   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
How to determine projected annual real growth of capital? Dude FIRE and Money 8 02-04-2007 01:38 PM
Market Return Portfolio ranch111 Young Dreamers 16 01-31-2007 06:16 PM
Feedback on my income/growth portfolio BD1 FIRE and Money 4 07-10-2006 07:00 PM
Beating the Market- Portfolio Advice charlottebandito Young Dreamers 8 07-02-2005 02:27 PM
Consistent 6-12% Returns? Tommy_Dolitte Young Dreamers 6 07-21-2004 04:40 PM


All times are GMT -6. The time now is 03:08 PM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2018, vBulletin Solutions, Inc.