Fees compound too
A 1% annual fee can consume a large share of lifetime returns once compounded over decades.
What it means for your portfolio
Small ongoing costs are a large long-run drag — worth checking on every fund you hold.
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The reward for equity risk is slow
Broad, diversified equity indices have historically compounded around 7-10% a year nominal over the very long run, with multiple 30-50% drawdowns along the way.
Rebalancing enforces discipline
Periodic rebalancing systematically trims what's grown and tops up what's lagged.
Turnover has a tax cost
Frequent trading can trigger capital gains and reduce compounding; in Australia, holding an asset over 12 months can access the CGT discount.
General information only, not financial advice. Historical figures are approximate and provided for education.