Volatility Meter
Some asset classes zig while others zag, which is why it makes good sense to hold a diversified mix of securities. Our tool illustrates the historical returns of key asset classes and shows how diversification can affect a portfolio's potential volatility and returns over the long run. Give it a go.
Allocation: equities 60%, fixed income 40%
Selected portfolio annualized return: 9%
Date range:
1961 – 2025
Compound Annualized Returns
| 1yr | 3yr | 5yr | 10yr | 15yr |
|---|---|---|---|---|
| 15.2 | 14.8 | 9.0 | 8.3 | 8.0 |
5yr Annualized Returns
| 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| 8.5 | 4.7 | 7.7 | 7.9 | 9 |
Note: All returns are total and in CAD. Blended returns are rebalanced annually. Data sources:
- Cash: 91-Day T-bills
- Canadian Equities: S&P/TSX Composite Index
- Global Equities: 1961–1969: 50% S&P 500 Index, 50% MSCI EAFE Index; post-1969: MSCI World Index
- Blended Equities: 50% Canadian and 50% Global
- Fixed Income: 5% Cash, 95% FTSE TMX Canada Universe Bond Index
Not sure how to use the tool? We walk through some of the key features in the video below.
A logarithmic scale is a scale of measurement that displays values using intervals corresponding to orders of magnitude, rather than a standard linear scale.
A simple example is a chart whose vertical or horizontal axis has equally spaced increments that are labeled 1, 10, 100, 1000, instead of what you’d find on a linear scale – i.e. 0, 1, 2, 3. When using a logarithmic scale, the distance between the prices in the scale will be equal when the percent change between the values is the same.
Despite the fact that the logarithmic scale is a foreign concept for most investors, we’ve made it the default on the growth chart because it’s a fairer representation of investors’ experience. Percentage gains/losses are the same in magnitude, no matter where they are on the chart. In other words, a 10% annual return on the bottom left is the same visually as a 10% gain on the upper right. On the linear version, the 10% gain doesn’t even register on the left and is a significant move on the right.
Another way to illustrate the difference is to look at it in dollar terms. On a linear scale, an increase in price from $10 to $15 (+50%) is the same as an increase from $20 to $25 (25%). When using a logarithmic scale, however, the distance between the prices will only be the same when the percent change is equal. Using the above example, the distance between $10 and $15 would be equal to the distance between $20 and $30 because both represent a price increase of 50%.
We encourage you to play around with the two charts and see what we mean.