Last Update: 31 October 2024
Commodities is an asset class belonging to Commodities category.
You can invest in this asset class, let it passively follow the market trend, and in the meantime you can periodically withdraw a portion of it for your retirement.
Worst case scenario so far, over a 30-year time horizon, you could have withdrawn 1.259% of your initial capital each year, kept withdrawing all the time (adjusting for inflation), and you wouldn't have run out of money before 30 years.
Considering the last 30-year (last update: October 2024), a safe withdrawal rate would have been 3.785%.
In this post, we will find out the most affordable withdrawal strategies. All calculations are made on actual historical series(*).
(*)1871-1970: data source extended with yearly real price variations of an equal-weighted commodity basket.
Commodities asset class
Over the last 30 years (last update: October 2024), the asset class has returned 1.81% annualized, with a maximum drawdown of -88.68%.
Let's consider different timeframes, all ending at October 2024: which Withdrawal Rates could you have applied without running out of money in your retirement?
Timeframes ending at Oct 2024 |
Withdrawal Rate (%) |
Investment Performances |
||||
|---|---|---|---|---|---|---|
| Timeframe | Period from | Period to | Perpetual | Safe | Ann.Return(%) [ Infl.Adj. ] |
Max Drawdown(%) |
| 10 Years |
1 Nov 2014 |
31 Oct 2024 | 0.000 | 5.291 |
-2.64 [ -5.37 ] |
-69.53 Nov 2014 - Apr 2020 |
| 20 Years |
1 Nov 2004 |
31 Oct 2024 | 0.000 | 2.382 |
-2.61 [ -5.03 ] |
-88.68 Jul 2008 - Apr 2020 |
| 30 Years |
1 Nov 1994 |
31 Oct 2024 | 0.000 | 3.785 |
1.81 [ -0.70 ] |
-88.68 Jul 2008 - Apr 2020 |
| 40 Years |
1 Nov 1984 |
31 Oct 2024 | 1.909 | 5.030 |
4.02 [ 1.20 ] |
-88.68 Jul 2008 - Apr 2020 |
| 50 Years |
1 Nov 1974 |
31 Oct 2024 | 0.376 | 2.450 |
4.06 [ 0.33 ] |
-88.68 Jul 2008 - Apr 2020 |
| 60 Years |
1 Nov 1964 |
31 Oct 2024 | 2.732 | 3.950 |
6.00 [ 1.98 ] |
-88.68 Jul 2008 - Apr 2020 |
| 70 Years |
1 Nov 1954 |
31 Oct 2024 | 1.556 | 2.437 |
5.10 [ 1.46 ] |
-88.68 Jul 2008 - Apr 2020 |
| 80 Years |
1 Nov 1944 |
31 Oct 2024 | 0.609 | 1.338 |
4.46 [ 0.76 ] |
-88.68 Jul 2008 - Apr 2020 |
Withdrawal Rates Simulation (updated at Oct 2024)
During your retirement, tipically you want to divest periodically some amount of money from your invested capital, without running out of money over a long period.
How much would it be an acceptable withdrawal rate, for the Commodities asset class?
For instance, assuming a 20 years retirement, the algorithm will cover each 20 year timeframe starting at every possible month in the given period between the start and end month.
Here's how simulations work (each simulation is based on actual asset class returns, in US dollars):
- At the beginning, you start with a certain amount of money invested in the portfolio (i.e. the initial invested capital).
- Each month, money is withdrawn from the portfolio. The withdrawal rate is calculated based on the initial withdrawn, annualized.
- Each month, portfolio value is updated, based on the asset classes returns (dividends are supposed to be reinvested).
- Each month, portfolio is rebalanced, to reset to the original weight of the assets (applicable only if portfolio contains at least 2 assets).
- Each month, the withdrawal is adjusted for inflation (US Inflation is used for simulation).
The Perpetual Withdrawal Rate (PWR) is the percentage of the initial portfolio balance that can be withdrawn at the beginning of each month with inflation adjustment, preserving the original invested capital, adjusted for inflation too.
The Safe Withdrawal Rate (SWR) is the percentage of the initial portfolio balance that can be withdrawn at the beginning of each month with inflation adjustment, without the portfolio running out of money.
Learn more about Withdrawal Rate simulation
Data Sources and Credits
Analyzing the available data source, several N-years timeframes have been considered to calculate the withdrawal rates and their success percentage.
For instance, given a 20 years timeframe, the algorithm will cover each 20 year timeframe starting at every possible month in the given period between the start and end month (Oct 2024).
|
PWR (%) - Perpetual Withdrawal Rate
|
SWR (%) - Safe Withdrawal Rate
|
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Preserved Capital (Infl.Adj) | 100% | 75% | 50% | 25% | 0% | 0% | 0% | 0% | 0% | ||
| Success Rate | 100% | 100% | 100% | 100% | 100% | 95% | 90% | 80% | 50% | ||
| Timeframes |
10 Years Worst Period (from) |
0.000 Jan 1878 |
0.000 Sep 1908 |
0.000 Feb 1910 |
0.000 Mar 2008 |
2.990 Jul 2008 |
5.245 | 6.695 | 8.455 | 9.601 | |
|
20 Years Worst Period (from) |
0.000 Dec 1884 |
0.000 May 1890 |
0.000 Feb 1899 |
0.439 May 1911 |
1.853 Feb 1916 |
2.618 | 2.972 | 3.556 | 5.172 | ||
|
30 Years Worst Period (from) |
0.000 Feb 1878 |
0.000 May 1888 |
0.000 Sep 1889 |
0.223 May 1901 |
1.259 Feb 1916 |
1.664 | 1.781 | 1.984 | 3.302 | ||
|
40 Years Worst Period (from) |
0.000 Dec 1873 |
0.000 Jun 1878 |
0.000 Feb 1880 |
0.000 Feb 1916 |
0.851 Feb 1916 |
1.171 | 1.219 | 1.321 | 2.147 | ||
|
50 Years Worst Period (from) |
0.000 Jan 1871 |
0.000 Jan 1871 |
0.000 Feb 1871 |
0.000 Feb 1899 |
0.604 Feb 1916 |
0.822 | 0.860 | 0.952 | 1.523 | ||
|
60 Years Worst Period (from) |
0.000 Jan 1871 |
0.000 Jan 1871 |
0.000 Jan 1871 |
0.000 Feb 1892 |
0.469 Feb 1916 |
0.599 | 0.628 | 0.682 | 1.217 | ||
|
70 Years Worst Period (from) |
0.000 Jan 1871 |
0.000 Jan 1871 |
0.000 Jul 1873 |
0.000 Aug 1887 |
0.419 Feb 1916 |
0.488 | 0.501 | 0.526 | 0.929 | ||
|
80 Years Worst Period (from) |
0.000 Jan 1871 |
0.000 Jan 1871 |
0.000 Jan 1871 |
0.000 Feb 1878 |
0.392 Sep 1896 |
0.415 | 0.430 | 0.453 | 0.653 | ||
|
PWR (%) - Perpetual Withdrawal Rate
|
SWR (%) - Safe Withdrawal Rate
|
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Preserved Capital (Infl.Adj) | 100% | 75% | 50% | 25% | 0% | 0% | 0% | 0% | 0% | ||
| Success Rate | 100% | 100% | 100% | 100% | 100% | 95% | 90% | 80% | 50% | ||
| Timeframes |
10 Years Worst Period (from) |
0.000 Feb 1933 |
0.000 Aug 1936 |
0.000 Feb 2005 |
0.000 Mar 2008 |
2.990 Jul 2008 |
5.033 | 7.161 | 8.361 | 9.605 | |
|
20 Years Worst Period (from) |
0.000 Nov 1926 |
0.000 Feb 1933 |
0.000 Feb 1937 |
0.711 Nov 2004 |
2.382 Nov 2004 |
3.352 | 3.444 | 3.818 | 5.645 | ||
|
30 Years Worst Period (from) |
0.000 Nov 1924 |
0.000 Nov 1924 |
0.000 Apr 1933 |
0.614 Mar 1941 |
1.784 Feb 1941 |
1.989 | 2.068 | 2.416 | 3.619 | ||
|
40 Years Worst Period (from) |
0.000 Nov 1924 |
0.000 Nov 1924 |
0.000 Nov 1929 |
0.880 Aug 1937 |
1.353 May 1936 |
1.456 | 1.570 | 1.749 | 3.030 | ||
|
50 Years Worst Period (from) |
0.000 Oct 1926 |
0.086 Apr 1936 |
0.447 Apr 1936 |
0.808 Apr 1936 |
1.168 May 1936 |
1.256 | 1.352 | 1.505 | 2.298 | ||
|
60 Years Worst Period (from) |
0.108 Aug 1925 |
0.417 Aug 1925 |
0.726 Aug 1925 |
0.957 Mar 1936 |
1.084 Mar 1936 |
1.149 | 1.197 | 1.313 | 1.671 | ||
|
70 Years Worst Period (from) |
0.260 May 1950 |
0.685 May 1950 |
0.912 Apr 1936 |
0.975 Apr 1936 |
1.038 Mar 1936 |
1.090 | 1.109 | 1.226 | 1.428 | ||
|
80 Years Worst Period (from) |
0.000 Apr 1940 |
0.101 May 1940 |
0.466 May 1940 |
0.790 Mar 1936 |
1.002 Mar 1936 |
1.026 | 1.062 | 1.092 | 1.220 | ||
|
PWR (%) - Perpetual Withdrawal Rate
|
SWR (%) - Safe Withdrawal Rate
|
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Preserved Capital (Infl.Adj) | 100% | 75% | 50% | 25% | 0% | 0% | 0% | 0% | 0% | ||
| Success Rate | 100% | 100% | 100% | 100% | 100% | 95% | 90% | 80% | 50% | ||
| Timeframes |
10 Years Worst Period (from) |
0.000 Nov 1974 |
0.000 Nov 1974 |
0.000 Feb 2005 |
0.000 Mar 2008 |
2.990 Jul 2008 |
4.645 | 4.906 | 6.657 | 10.812 | |
|
20 Years Worst Period (from) |
0.000 Aug 1995 |
0.000 Dec 1995 |
0.000 Dec 1996 |
0.711 Nov 2004 |
2.382 Nov 2004 |
3.602 | 4.337 | 5.377 | 6.938 | ||
|
30 Years Worst Period (from) |
0.000 Jan 1989 |
0.000 Jan 1990 |
0.000 Apr 1990 |
0.762 Oct 1990 |
2.816 Oct 1990 |
3.277 | 3.396 | 3.774 | 5.768 | ||
Withdrawals and Success Rate
If you had implemented a specific Withdrawal Strategy with the Commodities asset class, which would have been the success rate so far?
Simulations follow the same rules mentioned before. Withdrawals are expressed as yearly rates and refer to the initial capital. After that, withdrawal amount is monthly adjusted for inflation.
Success rates are calculated over all the past timeframes available in the data source. To focus on a specific withdrawal rate, click on the links in the table.
| Withdrawal Rate |
10 Years
|
10 Years
|
20 Years
|
20 Years
|
30 Years
|
30 Years
|
40 Years
|
40 Years
|
50 Years
|
50 Years
|
60 Years
|
60 Years
|
70 Years
|
70 Years
|
80 Years
|
80 Years
|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | |
| 2.00 % |
100.00
|
99.44
|
79.09
|
56.91
|
50% Succ. 2.147% |
29.27
|
17.75
|
6.36
|
0.00
|
|||||||
| 2.50 % |
100.00
|
100% Succ. 2.990% |
96.89
|
95% Succ. 2.618% |
66.38
|
38.62
|
22.21
|
13.58
|
0.00
|
0.00
|
||||||
| 3.00 % |
99.94
|
89.61
|
60.05
|
50% Succ. 3.302% |
29.63
|
17.08
|
7.99
|
0.00
|
0.00
|
|||||||
| 3.50 % |
99.83
|
80.83
|
80% Succ. 3.556% |
41.22
|
23.41
|
15.24
|
4.08
|
0.00
|
0.00
|
|||||||
| 4.00 % |
99.54
|
71.44
|
28.85
|
19.39
|
11.63
|
0.00
|
0.00
|
0.00
|
||||||||
| 4.50 % |
98.32
|
60.42
|
23.74
|
15.80
|
8.66
|
0.00
|
0.00
|
0.00
|
||||||||
| 5.00 % |
95.60
|
95% Succ. 5.245% |
53.33
|
50% Succ. 5.172% |
19.77
|
11.05
|
6.74
|
0.00
|
0.00
|
0.00
|
||||||
| 5.50 % |
93.98
|
39.89
|
15.74
|
7.02
|
5.45
|
0.00
|
0.00
|
0.00
|
||||||||
| 6.00 % |
93.05
|
29.74
|
13.11
|
5.41
|
4.41
|
0.00
|
0.00
|
0.00
|
||||||||
| 6.50 % |
91.95
|
90% Succ. 6.695% |
20.10
|
11.10
|
4.32
|
3.29
|
0.00
|
0.00
|
0.00
|
|||||||
| 7.00 % |
88.77
|
16.55
|
8.81
|
3.80
|
2.41
|
0.00
|
0.00
|
0.00
|
||||||||
| 7.50 % |
87.26
|
13.50
|
6.39
|
3.15
|
0.72
|
0.00
|
0.00
|
0.00
|
||||||||
| 8.00 % |
84.19
|
11.08
|
3.97
|
2.49
|
0.00
|
0.00
|
0.00
|
0.00
|
| Withdrawal Rate |
10 Years
|
10 Years
|
20 Years
|
20 Years
|
30 Years
|
30 Years
|
40 Years
|
40 Years
|
50 Years
|
50 Years
|
60 Years
|
60 Years
|
70 Years
|
70 Years
|
80 Years
|
80 Years
|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | |
| 2.00 % |
100.00
|
100.00
|
100% Succ. 2.382% |
94.41
|
90% Succ. 2.068% |
75.87
|
53.91
|
50% Succ. 2.298% |
41.58
|
17.73
|
0.00
|
|||||
| 2.50 % |
100.00
|
100% Succ. 2.990% |
99.79
|
78.72
|
56.45
|
45.42
|
31.81
|
0.00
|
0.00
|
|||||||
| 3.00 % |
99.91
|
98.86
|
95% Succ. 3.352% |
73.01
|
50.90
|
50% Succ. 3.030% |
35.44
|
18.71
|
0.00
|
0.00
|
||||||
| 3.50 % |
99.72
|
87.10
|
80% Succ. 3.818% |
54.34
|
50% Succ. 3.619% |
44.24
|
31.61
|
9.56
|
0.00
|
0.00
|
||||||
| 4.00 % |
99.26
|
76.07
|
45.90
|
36.75
|
24.13
|
0.00
|
0.00
|
0.00
|
||||||||
| 4.50 % |
98.89
|
66.29
|
39.95
|
29.96
|
17.97
|
0.00
|
0.00
|
0.00
|
||||||||
| 5.00 % |
95.19
|
95% Succ. 5.033% |
62.23
|
34.96
|
20.94
|
13.98
|
0.00
|
0.00
|
0.00
|
|||||||
| 5.50 % |
94.26
|
53.17
|
50% Succ. 5.645% |
27.82
|
13.31
|
11.31
|
0.00
|
0.00
|
0.00
|
|||||||
| 6.00 % |
93.34
|
44.12
|
23.19
|
10.26
|
9.15
|
0.00
|
0.00
|
0.00
|
||||||||
| 6.50 % |
92.04
|
32.26
|
19.62
|
8.18
|
6.82
|
0.00
|
0.00
|
0.00
|
||||||||
| 7.00 % |
90.66
|
90% Succ. 7.161% |
27.68
|
15.58
|
7.21
|
4.99
|
0.00
|
0.00
|
0.00
|
|||||||
| 7.50 % |
89.45
|
22.58
|
11.30
|
5.96
|
1.50
|
0.00
|
0.00
|
0.00
|
||||||||
| 8.00 % |
84.74
|
18.52
|
7.02
|
4.72
|
0.00
|
0.00
|
0.00
|
0.00
|
| Withdrawal Rate |
10 Years
|
10 Years
|
20 Years
|
20 Years
|
30 Years
|
30 Years
|
|---|---|---|---|---|---|---|
| % Success | Percentile | % Success | Percentile | % Success | Percentile | |
| 2.00 % |
100.00
|
100.00
|
100% Succ. 2.382% |
100.00
|
||
| 2.50 % |
100.00
|
100% Succ. 2.990% |
99.45
|
100.00
|
100% Succ. 2.816% |
|
| 3.00 % |
99.79
|
96.95
|
99.17
|
95% Succ. 3.277% |
||
| 3.50 % |
99.38
|
95.01
|
95% Succ. 3.602% |
86.72
|
80% Succ. 3.774% |
|
| 4.00 % |
98.34
|
93.07
|
90% Succ. 4.337% |
77.59
|
||
| 4.50 % |
97.51
|
95% Succ. 4.645% |
88.09
|
73.03
|
||
| 5.00 % |
89.19
|
83.10
|
80% Succ. 5.377% |
65.98
|
||
| 5.50 % |
87.11
|
77.56
|
54.77
|
50% Succ. 5.768% |
||
| 6.00 % |
85.03
|
70.36
|
46.06
|
|||
| 6.50 % |
82.12
|
80% Succ. 6.657% |
56.23
|
50% Succ. 6.938% |
37.34
|
|
| 7.00 % |
79.00
|
47.92
|
28.22
|
|||
| 7.50 % |
77.34
|
39.06
|
15.77
|
|||
| 8.00 % |
76.51
|
29.92
|
4.98
|
Related Pages
Asset Class Main Page:
Commodities Asset Class
For the Commodities Asset Class, we have prepared a report for each available timeframe:
10-Year
20-Year
30-Year
40-Year
50-Year
60-Year
70-Year
80-Year
if you want to learn more about the statistics of a specific withdrawal rate, we suggest these in particular:
2%
2.5%
3%
3.5%
4%
4.5%
5%
Website Homepage:
BestRetirementPortfolio.com
