How a portfolio stress test works

A stress test replays your portfolio against 10 historical market crises and reports how it would have performed if you had held those holdings through each event.

The 10 scenarios in the library span events from the dot-com bust through to the most recent rate-shock drawdowns. Each one carries the start and end dates of the drawdown window, so the test compares apples to apples across portfolios.

Returns are computed from adjusted close prices — dividends and splits are folded in — so a high-yield ETF and a non-dividend tech name can be ranked on the same scale.

The portfolio-level number is a weighted blend of every holding's individual scenario return. Drawdown follows the same weighting; the test does not pretend a 60/40 mix recovered when one leg of it did.

Stress tests are descriptive, not predictive. A holding that absorbed the 2008 financial crisis is not promised to absorb the next one — the economy underneath the ticker may have changed completely.

Reading the result: look at the worst three scenarios first. If those losses are bigger than you would tolerate in a real account, the portfolio is more aggressive than your stomach.

Compare to SPY — the S&P 500 benchmark shown on every card. A portfolio that loses less than SPY in every crisis behaved more defensively in this dataset; one that loses more took on extra historical risk for the upside it offered in good years.

Use the scenario detail pages to see the underlying daily price path. The summary number hides the timeline; the chart shows how fast the bottom arrived and how long the recovery took.