ETF 20-year Performance, Lazy and Adaptive Portfolios, and Managed Mutual Fund Insights (September 2025)

Topics this month

• Long-Term Performance of International ETFs (20-Year Review)
• New Tactical Recipe Overview Feature: Streamlined Access to Popular Allocation Strategies
• Lazy Portfolios: Performance Comparison and Risk Analysis
• Tactical and Adaptive Allocation Portfolios: Monthly Adjustments and the High-Performing t.aaaf Strategy
• Comparing Harry Browne's Original Four-Fund, Permanent Plus Three-Fund, and PRPFX Managed Implementations
• Talmud-Based Portfolios: Multi-Asset Performance and Gold Rally Impact Analysis

Welcome to the September 2025 edition of the Recipe Investing commentary. The platform now offers investors several useful updates and features worth highlighting. At the Pro subscription level, investors gain access to additional datasets from Vanguard, Fidelity, iShares, and American funds. These datasets include the same type of risk versus return analysis that is available for recipes and ingredients, but with broader coverage and deeper insights.

New Tactical Recipe Overview Feature

Another recent enhancement is the addition of the Tactical Portfolio Recipe Allocation Overview. This feature allows investors to view tactical asset allocation strategies in one place. For instance, the RF allocation remains one of the more popular choices. With this new overview, investors can easily compare and explore different tactical recipes without navigating through multiple sections.

International ETFs 20-Year Review

Turning to the portfolio ingredients list, investors can review the exchange-traded funds (ETFs) most commonly used in asset allocation portfolios—hence the term portfolio ingredients. These are displayed on a single page, along with several scatter plots that provide useful comparisons. To illustrate, consider a 20-year view of performance. Sorting the ETFs in descending order of returns allows investors to see, at a glance, which funds have delivered the highest annualized returns over the past two decades. This raises an important question: Which international funds, based on global equities or broader asset classes, have performed best during this period?

• The first non-U.S. fund to appear on the list is Taiwan (EWT), with an 8.6% annualized return over 20 years. However, it experienced a steep 58% drawdown, larger than the S&P 500’s 51% decline during the same timeframe (most notably in 2008).
• Switzerland (EWL) delivered an 8% annualized return, with a drawdown of 47.4%.
• Sweden (EWD) posted a 7.4% annualized return, though with a deeper 63% drawdown.

These numbers are respectable, particularly given that both Switzerland and Sweden maintain their own currencies rather than adopting the euro—a dynamic that warrants further exploration in its own right. Looking across the full 20-year ranking, the top ten funds are dominated by U.S. equities. Nonetheless, Taiwan, Switzerland, and Sweden stand out further down the list with strong long-term records. Each has also delivered solid results over the past five years, underscoring their resilience and relevance as portfolio ingredients.

Reviewing Portfolio Recipes

After examining portfolio ingredients, attention can be turned to portfolio recipes—the tactical and strategic asset allocation portfolios that often draw investor interest. These can be sorted by different header columns, such as peer group or recipe name, which allows for meaningful comparisons. When sorted by peer group, the Strategic DIY benchmarks become visible. In this context, strategic refers to static portfolios that maintain fixed allocations rather than changing month to month. Grouping them in this way makes it easier to evaluate performance within categories. Sorting by recipe name highlights another group often discussed by investors: the lazy portfolios.

Lazy Portfolios

All strategic or static portfolios may be considered “lazy,” but this particular group was labeled as such years ago, with each portfolio given the “lazy” prefix. Reviewing their long-term results provides insight into how they compare against one another and against benchmarks like the S&P 500.

• Best-performing lazy portfolio:
  • 8.5% annualized return over 20 years
  • 49% drawdown (similar to the S&P 500)
    
• Lowest-drawdown lazy portfolios:
  
  • Lower annualized return of 5.8% over 20 years
    

While drawdown is not the only measure of risk, it remains a useful metric for understanding potential downside exposure. Viewing the lazy portfolios side by side, alphabetized, allows investors to quickly compare performance and risk across the group.

Tactical DIY and Adaptive Allocation Portfolios

Another peer group worth examining is the Tactical DIY portfolios. Unlike strategic portfolios, these allow allocations to be adjusted on a monthly basis if the underlying algorithm indicates a need for change. This flexibility enables investors to respond more dynamically to market conditions. A particularly popular subset within this group is the Adaptive Allocation portfolios. There are six variations of these portfolios, each designed with slight differences in methodology. The distinctions often relate to the number of lookback days used in the model and the specific risk management or covariance minimization strategy applied.

While they share a common framework, the variations have delivered different performance results over time. One example, the t.aaaf portfolio, illustrates the potential of this approach:

• 14% annualized return over the past 20 years
• Maximum drawdown of 18.9%, which occurred only a few years ago rather than during the 2008 financial crisis
• 11.5% return year-to-date, despite periods of volatility

Although not without fluctuations, the combination of relatively high long-term returns and limited drawdowns makes this portfolio notable among adaptive strategies.

Low-Equity Portfolios

After reviewing the six Adaptive Allocation portfolios tracked at RecipeInvesting.com, it is also useful to examine portfolios grouped by category. One such category is Low Equity, which includes portfolios with equity exposure typically less than half of the total allocation—sometimes as little as one-third or one-quarter. A notable example in this group is the Harry Browne–inspired portfolio (s.brow), also known as the Permanent Portfolio, which holds four exchange-traded funds in equal proportions: a broad-based equity fund, gold, long-term bonds, and short-term fixed income through the SHY ETF.

Over the past 20 years, this allocation delivered:

• 7% annualized return
• 17.5% maximum drawdown — a relatively modest level of downside risk

For comparison, another variation is the Permanent Plus (s.plus) portfolio. This approach removes the SHY (short-term fixed income) component, redistributing that allocation equally among the remaining three assets. The reasoning is that the cash-like component often drags down overall returns.

The results over 20 years confirm this trade-off:

• 9.4% annualized return — higher than the traditional Permanent Portfolio
• 24% maximum drawdown — larger because the stabilizing effect of the cash component is absent

While drawdown is not the only measure of risk, it provides an intuitive way to compare portfolios at a glance. This illustrates the balance between upside potential and downside protection when adjusting equity and fixed-income exposure.

Permanent Plus and the Managed Permanent Portfolio

The Permanent Plus portfolio has outperformed the traditional Harry Browne Permanent Portfolio over the past 20 years. For investors seeking another variation, there is also a professionally managed mutual fund that follows the Permanent Portfolio concept, though not exactly as Harry Browne originally designed it.

This fund, known as PRPFX, expands beyond the four basic components by including additional asset slices. Over the past two decades, it has delivered an 8.1% annualized return, with a maximum drawdown of 19.1%. The fund carries an annual fee of 0.81%, but the reported returns are net of fees. In terms of performance and structure, PRPFX falls somewhere between the original four-fund Harry Browne portfolio and the streamlined Permanent Plus three-fund portfolio, providing investors with a one-stop, professionally managed solution for implementing the Permanent Portfolio strategy.

Talmud-Inspired Portfolios

That covers three variations of the Permanent Plus or Harry Browne–inspired portfolios. Shifting focus, another interesting group emerges when sorting by recipe name: the Talmud-inspired portfolios. These portfolios are based on an allocation approach drawn from Talmudic wisdom, dividing assets among several classes. One example is the Talmud Equities and Gold portfolio (s.talg), a static allocation spread across gold, real estate, and a broad equities fund.

The Talmud-inspired portfolios differ primarily in the specific exchange-traded funds used, but their overall framework remains consistent. Performance has been notable:

• Talmud Equities and Gold delivered 10.1% annualized returns over the past 20 years, with a 38.5% maximum drawdown.
• Returns have remained strong across all time horizons, producing double-digit results from 1-year to 20-year lookbacks.
• Recent performance has also been impressive, including a 3.6% gain over the past month.

Gold’s recent upward rally has provided a meaningful boost to these results, contributing to the portfolio’s consistency and strength.

Investors now have a range of portfolio categories to explore, including lazy portfolios, adaptive portfolios, permanent portfolios, and Talmud-inspired portfolios. One effective way to compare these strategies is by sorting them into categories and analyzing their performance through scatter plots. These scatter plots display not only the portfolios being reviewed but also their peer groups, making it easier to understand relative positioning:

• Gray dots represent the peer group. For example, in the case of a Strategic DIY peer group, the scatter plot shows how a portfolio performs against others in the same category. Many of these portfolios are positioned near the top, indicating competitive performance.
• Tan dots represent the full range of portfolios tracked, including both tactical portfolios (which can shift allocations monthly) and strategic ones.

The ideal goal is to move as close as possible to the “northwest corner” of the chart, where returns are high and risk is low. While no portfolio lands there perfectly, the plots often reveal a performance frontier, where investors can choose between higher-risk, higher-return options or lower-risk portfolios that still deliver competitive results.

For example, the t.aaaf portfolio stands out with an annualized return of 12.3% over the past ten years, paired with a relatively modest 6.4% downside deviation. This combination demonstrates a strong balance between growth and risk management, making it a compelling option within the broader portfolio landscape.

 This review of different portfolio recipe families highlights the many ways investors can evaluate and compare them. Portfolios can be measured not only by drawdown or through summary lists, but also by examining scatter plots that show their performance across different dimensions. Beyond scatter plots, a variety of other risk metrics can also be applied. These allow for comparisons against peer groups, the traditional 60/40 balanced fund, or well-known benchmarks such as a broad bond fund or the S&P 500. Together, these tools provide investors with a clear framework for categorizing and evaluating portfolio recipes, making it easier to understand how different strategies perform relative to each other and to the broader market.