Portfolio Rebalancing Backtester
Choose an Equity/Debt/Gold mix, pick a rebalancing frequency, and see exactly what would have happened to ₹1 lakh (or any amount) invested in Indian markets — using 45 years of real Sensex and gold price data.
Asset Allocation
Backtest Period
From(different months show rolling-return effect)
Rebalancing strategy
Rebalance when any asset strays from target by more than:
Uses approximate BSE Sensex, Midcap, and Smallcap year-end values interpolated to weekly frequency. BSE Midcap and Smallcap data starts April 2002. Intra-year crashes (COVID Mar 2020, GFC Oct 2008) are modelled as anchor points. Transaction costs, LTCG taxes, and exit loads are not modelled. Past performance does not guarantee future results.
How this works
Data sources
Equity returns track the BSE Sensex (year-end closing values, 1980–2024). Gold uses ₹/10g spot prices. Debt uses the RBI repo / bank rate as a short-term debt-fund return proxy. Annual values are interpolated to weekly frequency.
Backtest mechanics
Your initial investment is split per your chosen allocation. Weekly returns are applied continuously. At each year boundary the portfolio is rebalanced back to target weights (based on your chosen frequency). CAGR and max drawdown are computed from the resulting weekly series.
Why rebalancing matters
Without rebalancing, a strong equity year (like 2007 +47%) drifts your allocation toward equities, increasing risk. Annual rebalancing forces you to sell the winner and buy the laggard — reducing drawdown when the inevitable correction hits (2008 −52%). The 2008 row in the comparison table shows this most clearly.
Limitations
- Intra-year volatility is smoothed (values interpolated between year-ends)
- Max drawdown only reflects year-to-year declines, not intra-year crashes
- Transaction costs, taxes (LTCG, STT), and exit loads are not modelled
- Sensex and gold data are approximate — use as directional guidance only
A note worth reading before you act
The FIRE math works — but equity returns are not a guarantee. Every projection on this site uses long-term historical averages as a baseline. Markets can and do deliver a decade of poor returns, and if that decade happens to be the early years of your retirement, it puts real pressure on even a well-sized corpus. This isn't a reason to not pursue FIRE. It is a reason to build in margin.
The single most effective safety net is an active income source — even a small one. Freelance work, consulting, a part-time role, rental income. If your portfolio has a bad year and returns 6% instead of 12%, ₹15,000–₹25,000 a month of outside income means you don't have to redeem units at a loss while the market is down. You simply wait.
Financial independence is worth building towards. But “retired” doesn't have to mean “never earns again.” Keep a skill that someone will pay you for. Treat your corpus target as a floor, not a finish line. The goal is resilience — not just a number.
Not financial advice. planMyFIRE is not a SEBI-registered Investment Adviser. Calculator results are estimates based on historical assumptions and are for educational purposes only. Past market returns do not guarantee future performance. Consult a SEBI-registered adviser before making investment decisions. Terms of use.