CREATING EXTRAORDINARY RETIREMENTS
Pursuing . Investment Experience
Key Principles To Improve Your Odds Of Success
Past performance is no guarantee of future results. Indices are not available for direct investment.
Index performance does not reflect the expenses associated with the management of an actual portfolio.
In New Zealand dollars. Source: Dimensional, using data from Bloomberg LP. Includes primary and secondary exchange trading volume globally for equities. ETFs and funds are excluded. Daily averages were computed by calculating the trading volume of each stock daily as the closing price multiplied by shares traded that day. All such trading volume is summed up and divided by 252 as an approximate number of annual trading days.
The sample includes US mutual funds at the beginning of the 20-year period ending December 31, 2018. Each fund is evaluated relative to its respective primary prospectus benchmark as of the end of the evaluation period. Surviving funds are those with return observations for every month of the sample period. Winner funds are those that survived and whose cumulative net return over the period exceeded that of their respective primary prospectus benchmark. Loser funds are funds that did not survive the period or whose cumulative net return did not exceed that of their respective primary prospectus benchmark. Where the full series of primary prospectus benchmark returns is unavailable, funds are instead evaluated relative to the Morningstar category index assigned to the fund’s category at the start of the evaluation period.
This study evaluated US mutual fund performance persistence over rolling periods from 1999 through 2018. Each year, funds are sorted within their category based on their previous five-year total return. Those ranked in the top quartile (25%) of returns are evaluated over the following five-year period. The chart shows the average percentage of top-ranked equity and fixed interest funds that kept their top ranking in the subsequent period.
The Dimensional Funds referred to are U.S. mutual funds which are not registered as managed investment schemes with the Australian Securities and Investments Commission and as such these funds are not currently available to Australian investors. US-domiciled open-end mutual fund data is from Morningstar. Equity fund sample includes the Morningstar historical categories: Diversified Emerging Markets, Europe Stock, Foreign Large Blend, Foreign Large Growth, Foreign Large Value, Foreign Small/Mid Blend, Foreign Small/Mid Growth, Foreign Small/Mid Value, Global Real Estate, Japan Stock, Large Blend, Large Growth, Large Value, Mid-Cap Blend, Mid-Cap Growth, Mid-Cap Value, Miscellaneous Region, Pacific/Asia ex-Japan Stock, Real Estate, Small Blend, Small Growth, Small Value, World Large Stock, and World Small/Mid Stock. Fixed interest fund sample includes the Morningstar historical categories: Corporate Bond, High Yield Bond, Inflation-Protected Bond, Intermediate Government, Intermediate-Term Bond, Long Government, Muni California Intermediate, Muni California Long, Muni Massachusetts, Muni Minnesota, Muni National Intermediate, Muni National Long, Muni National Short, Muni New Jersey, Muni New York Intermediate, Muni New York Long, Muni Ohio, Muni Pennsylvania, Muni Single State Intermediate, Muni Single State Long, Muni Single State Short, Short Government, Short-Term Bond, Ultrashort Bond, and World Bond. See Dimensional’s Mutual Fund Landscape 2019 for more detail. Index data provided by Bloomberg Barclays, MSCI, Russell, FTSE Fixed Income LLC, and S&P Dow Jones Indices LLC. Bloomberg Barclays data provided by Bloomberg. MSCI data © MSCI 2019, all rights reserved. Frank Russell Company is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes. FTSE fixed income indices © 2019 FTSE Fixed Income LLC. All rights reserved. S&P data © 2019 S&P Dow Jones Indices LLC, a division of S&P Global. All rights reserved.
In New Zealand dollars. New Zealand Share Market: S&P/NZX 50 Index (Gross), Bloomberg NZBond Bank Bill Index and Inflation CPI: New Zealand Consumer Price Index. Past performance is no guarantee of future results. S&P © 2019 S&P Dow Jones Indices LLC, a division of S&P Global. All rights reserved. Bloomberg Barclays data provided by Bloomberg. Data produced by Statistics New Zealand (“Stats NZ”). Index performance does not reflect expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results.
Relative price is measured by the price-to-book ratio; value stocks are those with lower price-to-book ratios. Profitability is measured as operating income before depreciation and amortisation minus interest expense scaled by book.
Number of holdings and countries for the S&P/NZX 50 Index (Gross) and MSCI ACWI (All Country World Index) Investable Market Index (IMI) as at 31 December 2018. S&P © 2019 S&P Dow Jones Indices LLC, a division of S&P Global. All rights reserved. MSCI data copyright MSCI 2019, all rights reserved. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. International investing involves special risks such as currency fluctuation and political instability. Investing in emerging markets may accentuate these risks. Past performance is not a guarantee of future results. Diversification does not eliminate the risk of market loss.
In New Zealand dollars. Data is the annual return to 31 December 2018. Data used for each asset class is as follows: New Zealand Equities: S&P/NZX All Index (Capital), Australian Large: S&P/ASX 100 Index (Total Return), Australian Small: S&P/ASX Small Ordinaries Index (Total Return), Australian Value: S&P Australia BMI Value Index (gross div.), Global Large + Mid: MSCI World Index (net div.) Global Small: MSCI World Small Cap Index (net div.), Global Value: MSCI World Value Index (net div.), Emerging Markets: MSCI Emerging Markets Index (net div.), Property: S&P Global REIT Index (net div.), Cash: New Zealand One-Month Bank Bill Yields Index, Fixed Interest: Bloomberg Barclays Global Aggregate Bond Index (hedged to NZD). MSCI data copyright MSCI 2019, all rights reserved. Bloomberg Barclays data provided by Bloomberg. S&P © 2019 S&P Dow Jones Indices LLC, a division of S&P Global. All rights reserved. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. Chart is for illustrative purposes only.
All investing is subject to risks, including market fluctuations and possible loss of the principal amount invested. There is no guarantee the strategies will be successful.