Did you subtract the cash withdrawal before rebalancing, or take 1/4 from each asset?  If the former, that is a spectacular demonstration of the benefits of using rebalancing bands.  Note that with many Boglehead style "slice and dice" portfolios, annual rebalancing ends up being a necess...

If everything is so simple, what are we all doing here every day? Just because one does not believe in God does not mean one does not live on faith in other parts of their lives.  Sometimes checking in regularly isn't so much an act of continuous learning, but one of regular maintenance for a belie...

Is some of the effect actually due to the even draw down approach in general having more cash (back to 25% each year) whilst the kosher method hovers around 15% cash as the drawdowns from cash trigger rebalances? If so, it might actually bode well for a 3x33%PP (no cash) where draw downs came from ...

should we use a data set of real returns instead of nominal returns? i did an analysis a while back with r-returns for a CA PP and got about 3.5% r-swr the portfolio real value to to decrease. i guess you re at about the same with 5.5% nominal swr.  it did however made me realise that i would get l...

Tyler, how did you automate rebalancing??  Would love to learn a new Excel trick. 1) I created a new column that looked for portfolio percentages outside the bands: =IF(OR(R12>0.35, R12<0.15, S12>0.35, S12<0.15,T12>0.35,T12<0.15,U12>0.35,U12<0.15),1,0) This returns a 1 if true and a 0 if false 2) I...

So does the PP allow a surprisingly high SWR primarily because of (a) its 25% cash allocation or (b) the low volatility of the overall portfolio? It sounds like it's (a), but I'm just curious as to whether anyone here disagrees with that assessment. An SWR comparison analysis between a 3x33% PP (no...

Alright.  Now this is getting interesting.  I managed to automate the PP rebalancing in Excel, which allowed me to start doing some more significant number crunching.  Since retirement portfolio success is highly dependent on the year you retire (if the market crashes 50% in year 1, your WR just dou...

Nice graphs, Pointedstick.  Thanks.  Here's one cool observation from WiseOne's spreadsheet to help explain the smoothness of the PP in retirement: In 2008, stocks fell 37% and the PP fell 0.8% in real terms.  But that actually still wasn't enough to trigger a rebalance.  So unlike many retirees who...

http://www.youtube.com/watch?v=UgDuu6i8MtE I am aware from news of previous trials that the defendant in a trial does not need to testify.  I was not aware that the judge was allowed to do things like this.  I'd like the reaction of a lawyer, in case this is not what it looks like. Thanks. I'm no l...

One thing that gives me pause in comparing "end values" is the unusually high real return (15.2%) of the PP in 1972, the first year of the run.  One could argue it stacks the deck in the PP's favor by giving it a 15% head start over others.  Starting one year later, the end value is $9.3mm...

Thanks WiseOne.  Awesome work! Main conclusion:  nobody ever actually just invests money in a reasonable allocation and leaves it alone for 40 years, or there'd be a lot of exceedingly wealthy octogenarians out there. Very true.  So much retirement theory discussion consists of hand-waving.  Very fe...

Don't lose hope yet, Pointed!  You're forgetting something:  the cash allocation.  Great point!  SWR calculations also assume you always sell stocks/bonds even in down years to pay the bills.  With the heavy cash allocation in the PP, there will be many years where you don't need to sell a thing an...

dualstow wrote: {deleted. too difficult }

What is... my wife's response when asked about the PDF I saved for her on the importance of compromise?

I know you're a fellow ERE hopeful, Pointedstick.  What has you so stressed? A bit of background on Safe Withdrawal Rates: The 4% SWR is based on research called the Trinity Study which looked a wide variety of traditional stock/bond blends to see what level of withdrawals could have been historical...

Reub wrote: Corzine off the hook

Not surprised.  Just disgusted. 

Some individuals are clearly too big to fail.  That nobody will be imprisoned for MF Global theft is itself a criminal act. 

The funny thing is that in many occasions internet arguments are much worse than those in real life. Anonymity, trivially easy association bias, and detachment from seeing the person you're talking to can bring out the worst in people. This just happens to be a good forum with mostly thoughtful, int...

IMHO, the article suffers from a familiar weakness:  Assume they're totally right.

What should an investor do?  How does "government psychopathy" only affect the PP?  What is a better alternative?

I learned a lot from this forum and from the book but i genuinely no longer trust the PP as a viable investment strategy for the current economic environment. The theory sounds fantastic but it does not hold. The strategy proved to be way too volatile and risky for my liking and I certainly would n...

Thanks for the post, Wonk.  It's nice to reset in a positive tone. I'm hopefully getting close to ER, and I actually don't mind the mild downturn right now.  From a SWR perspective, having gold and bonds correct from unusual highs before I start making withdrawals is a positive for my long-term secu...

I've found that traveling a lot for work really influenced my minimalist tendencies.  Living out of a carry-on for weeks at a time gives you a good perspective on what is really necessary for happiness.  For family heirlooms, I've found it helpful to give them to other siblings.  You don't always ha...

Because of the diversification your reaction to the PP is a bit of a personality test.  Take yesterday -- some people focused on gold tanking and naturally freaked out.  I watched cash stay put in a horrible market for every other asset and felt pretty satisfied.  Some of that may also be my enginee...

MediumTex wrote: You can do a lot with boats.

Throw in an unfortunate boating accident where David "loses" the stolen jewels along with his bullion investments, and you've got yourself a happy ending.

Based on the plot, I like Malibu Joe.

Alright, I admit it -- It was me.  I bought more gold in March.  My bad, guys.

Craig addresses exactly this point in the Crawlingroad link you provide.  The results are still quite good.  One should compare portfolios and not simply starting years.  I could move the start date in absolutely any investment portfolio to pick a set of dates that over- or under-performs another.  ...

MediumTex wrote: I have read and listened to David Brooks for many years and I have concluded that he is a complete idiot. 

Ha.  This is the message board equivalent of a movie trailer that gives away the entire plot.  Your post is great, but you could have stopped after the first sentence.  ; )