When it comes to assessing performance of retirement income portfolios, the existing benchmarks and indices — whether we consider the S&P 500 or the broader Russell 3000 or even the MSCI family — all fall short.
It is time to create and promote an index that is geared towards systematic income plans as opposed to buy-and-hold accumulation plans. The index must account for both market performance and the maximum lifetime spending rate that can be obtained without incurring any longevity risk.
The QWeMA Sustainable Portfolio Withdrawal Index (or QSPW index) is that index. It identifies the inflation-adjusted income stream a portfolio would produce if completely annuitized. The QWeMA Group launched this innovative benchmark on January 1, 2010 and will report the index monthly.
The QSPW index allows a user to compare any portfolio to a portfolio which is being withdrawn according to a plan that is 100% sustainable.
For more information about the QSPW index, please click here to read the January 2010 Research Magazine article, “A Truly Relevant Benchmark.”
| Date |
Retire at Jan 2008 |
Retire at Jan 2009 |
Retire at Jan 2010 |
| Jan 2011 |
82.35 |
121.62 |
107.48 |
| Dec 2010 |
79.82 |
117.64 |
103.99 |
| Nov 2010 |
80.72 |
118.72 |
104.97 |
| Oct 2010 |
79.44 |
116.60 |
103.12 |
| Sep 2010 |
75.58 |
110.72 |
97.95 |
| Aug 2010 |
77.39 |
113.12 |
100.11 |
| Jul 2010 |
74.26 |
108.32 |
95.89 |
| Jun 2010 |
76.49 |
111.34 |
98.59 |
| May 2010 |
81.23 |
117.99 |
104.51 |
| Apr 2010 |
80.10 |
116.12 |
102.88 |
| Mar 2010 |
77.52 |
112.16 |
99.40 |
| Feb 2010 |
76.36 |
110.26 |
97.74 |
| Jan 2010 |
78.26 |
112.78 |
100.00 |
| Dec 2009 |
78.16 |
112.41 |
|
| Nov 2009 |
75.50 |
108.37 |
|
| Oct 2009 |
77.38 |
110.86 |
|
| Sep 2009 |
75.50 |
107.96 |
|
| Aug 2009 |
74.02 |
105.63 |
|
| Jul 2009 |
70.06 |
99.78 |
|
| Jun 2009 |
69.74 |
99.11 |
|
| May 2009 |
67.39 |
95.57 |
|
| Apr 2009 |
63.02 |
89.19 |
|
| Mar 2009 |
60.43 |
85.33 |
|
| Feb 2009 |
66.53 |
93.73 |
|
| Jan 2009 |
71.14 |
100.00 |
|
| Dec 2008 |
67.17 |
|
|
| Nov 2008 |
70.16 |
|
|
| Oct 2008 |
80.36 |
|
|
| Sep 2008 |
89.20 |
|
|
| Aug 2008 |
88.78 |
|
|
| Jul 2008 |
89.84 |
|
|
| Jun 2008 |
95.52 |
|
|
| May 2008 |
95.76 |
|
|
| Apr 2008 |
93.07 |
|
|
| Mar 2008 |
94.52 |
|
|
| Feb 2008 |
96.93 |
|
|
| Jan 2008 |
100.00 |
|
|
