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If you look at the definition of "60/40 stock/bond portfolio" at 24:14 of the video, it says:

60/40 is 60% S&P 500 and 40% 10-year Treasury

This is the part where it is misleading. Treasury Bonds had a magnified great run in the past 20 years. The longer the duration of the Treasury, the higher return and lower volatility it brings.

This 60/40 is different from the Modern Portfolio Theory, where the "Market Portfolio" is 60% Total Stock Market and 40% Total Bonds Market (including Treasury, Corporate, Municipal, Junk, etc).

So instead of 40% BND ETF that Bogleheads recommended, the 10-year Treasury is simulated by IEF ETF and TLH ETF on a 7:3 Ratio.

They could have made it more misleading by using 20-25 years Treasury (i.e. TLT and EDV ETF).


Back to your question #1 and #2. In the following charts:

  • Portfolio 1 represents 60% S&P 500 and 40% 10-year Treasury
  • Portfolio 2 100% S&P 500

Asseume Reinvested Dividend/Interest.

$100k Lump Sum with No Rebalancing = False

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$100k Lump Sum with Quarterly Rebalancing = False

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$100k Lump Sum and $5k Monthly Dollar Cost Averaging with No Rebalancing = False

enter image description here

$100k Lump Sum and $5k Monthly Dollar Cost Averaging with Quarterly Rebalancing = False

enter image description here


I would not spend a minute of my life watching such videos.

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