Chart of the Week – October 21, 2024

This week’s chart illustrates the worst annual returns for a 60% stock and 40% bond portfolio. A couple items stand out. First, the lowest return ever recorded for this portfolio was -27.3% in 1931, during the Great Depression. Was anyone else surprised that it wasn’t worse? Second, the third worst year for the 60/40 portfolio was quite recent, with a return of -16.9% in 2022. Investors should be cautious, but historical data shows that balanced portfolios have proven to be effective and diversification helps. Looking on the positive side, the average return for a 60/40 portfolio from 1950 to 2023 was 9.3%.