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Investment Visual

Permanent Portfolio

Nov 18, 2004 – Sep 24, 2026, Rebalanced annually

Backtest it
Permanent PortfolioS&P 500
Final balance$46,365$96,443
CAGR7.27%10.93%
Max drawdown−19.03%−55.19%
Sharpe ratio0.980.65

Allocation

  • VTIUS total stock market25%
  • TLTLong-term Treasuries25%
  • SHYShort-term Treasuries25%
  • GLDGold25%

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Growth of $10,000

  • Permanent Portfolio
  • S&P 500

Metrics

ReturnPermanent PortfolioS&P 500
Final balance$46,365$96,443
Total return363.65%864.43%
CAGR7.27%10.93%
Calendar yearsPermanent PortfolioS&P 500
Best year22.49%32.31%
Worst year−13.85%−36.80%
Positive years17 of 2118 of 21
RiskPermanent PortfolioS&P 500
Max drawdown−19.03%−55.19%
Longest drawdown2.5 years4.9 years
Volatility (annualized)7.46%18.85%
Risk-adjustedPermanent PortfolioS&P 500
Sharpe ratio0.980.65
Sortino ratio1.410.91
Calmar ratio0.380.20

Worst drawdowns

DeclinePeakBottomRecovered
−19.0%Nov 2021Oct 2022May 2024
−14.1%Mar 2008Nov 2008Aug 2009
−11.1%Mar 2020Mar 2020Apr 2020
−8.0%Jul 2016Dec 2016Aug 2017
−8.0%May 2006Jun 2006Nov 2006

Annual returns

YearPermanent PortfolioS&P 500
2004*+0.51%+2.27%
2005+8.55%+4.83%
2006+10.71%+15.85%
2007+13.37%+5.15%
2008+2.13%−36.80%
2009+7.87%+26.35%
2010+14.50%+15.06%
2011+11.49%+1.89%
2012+6.43%+15.99%
2013−2.01%+32.31%
2014+9.53%+13.46%
2015−2.92%+1.23%
2016+5.71%+12.00%
2017+10.87%+21.71%
2018−1.83%−4.57%
2019+16.51%+31.22%
2020+16.77%+18.33%
2021+4.05%+28.73%
2022−13.85%−18.18%
2023+11.42%+26.18%
2024+11.58%+24.89%
2025+22.49%+17.72%
2026*+1.61%+13.38%

* Partial year

About the Permanent Portfolio

Harry Browne first described a Permanent Portfolio in a 1981 book. His later books settled on this version, which splits the money equally between four assets, each for a different kind of economy. Stocks do well in booms, long-term bonds in deflation, cash in recessions and gold in inflation.

Returns are modest, but so are the losses. Browne advised checking once a year and rebalancing only if an asset had fallen below 15% or risen above 35%. This backtest simply rebalances every year. The Golden Butterfly is a version with more stocks.

The Permanent Portfolio returned 7.3% a year from Nov 2004 to Sep 2026, against 10.9% for the S&P 500. Its biggest drop was 19.0%, against 55.2% for the S&P 500. It took 2.5 years to recover. It beat the S&P 500 in 7 of 21 full years.

Uses daily closing prices with dividends reinvested. Fund fees are included, but not taxes or trading costs. The backtest starts on Nov 18, 2004, the first day all four funds have prices. The S&P 500 is SPY.

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