Search found 211 matches
- Tue Jul 01, 2014 8:42 am
- Forum: Permanent Portfolio Discussion
- Topic: Financial benefit of reading Ben Graham's book knowing Warren Buffett's alpha?
- Replies: 5
- Views: 4912
Re: Financial benefit of reading Ben Graham's book knowing Warren Buffett's alpha?
Correct me if I'm wrong but weren't index funds unavailable in Graham and Buffett's heydays? If so, generating even an alpha of 0 by buying 10 stocks rather than 500 (from the S&P 500) would be a win in my book.
- Tue Jun 24, 2014 9:46 am
- Forum: Permanent Portfolio Discussion
- Topic: How should contributions/withdrawals be treated for rebalancing?
- Replies: 6
- Views: 4223
Re: How should contributions/withdrawals be treated for rebalancing?
I buy up to 2 assets each time with the cash contribution with my monthly contribution. For larger one-time contributions, it's fine to buy all 4 assets, and I usually default to rebalancing to 25/25/25/25 using cash, unless I have views on some of the assets.. in that case, I'll choose a weight in...
- Sun Jun 01, 2014 3:22 pm
- Forum: Permanent Portfolio Discussion
- Topic: A PP In Every Account
- Replies: 24
- Views: 10246
Re: A PP In Every Account
How would you rebalance if you had bonds and gold in IRAs and Stocks in taxable and one craters while the other shoots to the moon? Being able to deal with that problem is a main reason I use the PP, and separating assets in taxable and tax-free defeats the purpose.
- Sun Jun 01, 2014 12:46 pm
- Forum: Permanent Portfolio Discussion
- Topic: Any Idea How Many People Use The PP Strategy?
- Replies: 20
- Views: 11641
Re: Any Idea How Many People Use The PP Strategy?
Bridgewater All-Weather has about $50 Billion or so assets under management.. PRPFX has about $8 billion Although these are not true implementations of the PP, they pretty much have the same intention: creating a safe and secure portfolio that's relatively insensitive to the economic cycle (in theor...
- Fri May 30, 2014 3:06 pm
- Forum: Permanent Portfolio Discussion
- Topic: A PP In Every Account
- Replies: 24
- Views: 10246
Re: A PP In Every Account
I have 3 PPs: 1) A Strong-Dollar Hedged PP in my taxable account where most of my wealth is currently held (25/25/25/25 SPY/IAU/TLT/UUP) 2) A 2.66x Leveraged PP in my IRA: (33/33/33 SSO/UBT/UGL) 3) PERM in my other IRA that has about $1500 or so.. I keep it open cause it's with Fidelity and I like ...
- Fri May 30, 2014 12:34 pm
- Forum: Permanent Portfolio Discussion
- Topic: How 2 assets with negative returns and negative correlations can make money
- Replies: 44
- Views: 24691
Re: How 2 assets with negative returns and negative correlations can make money
I get that the main benefit from rebalancing is hopefully lower volatility and higher sharpe ratios but even those are not guaranteed especially if the future correlations between the assets differ drastically from those observed in the past. This is a really good point. Many have the opinion that ...
- Thu May 29, 2014 11:39 pm
- Forum: Permanent Portfolio Discussion
- Topic: How 2 assets with negative returns and negative correlations can make money
- Replies: 44
- Views: 24691
Re: How 2 assets with negative returns and negative correlations can make money
I don't have the need or patience to prove or disprove anything.. the purpose here is just to point something out. Since when did this turn into a full fledged debate? I was merely pointing something out and there's no claim whether rebalancing is advantageous or disadvantageous, it's up to you a...
- Thu May 29, 2014 3:21 pm
- Forum: Permanent Portfolio Discussion
- Topic: How 2 assets with negative returns and negative correlations can make money
- Replies: 44
- Views: 24691
Re: How 2 assets with negative returns and negative correlations can make money
Yes you can cherry pick any start and end times you want. That's my entire point. We can't trade the past, only the future, and there is no certainty that rebalancing going forward will return more than not. If you believe there is, then how can I cherry pick a 33 year period where it didn't work? ...
- Thu May 29, 2014 2:54 pm
- Forum: Permanent Portfolio Discussion
- Topic: How 2 assets with negative returns and negative correlations can make money
- Replies: 44
- Views: 24691
Re: How 2 assets with negative returns and negative correlations can make money
Just wondering, can you cherry pick starting times, with no rebalancing that show stocks only doing significantly worse? I bet you can. And of course, don't forget, one of the selling points of a PP is the lowered volatility and drawdowns. How hard would it have been for stock only holders to sit...
- Thu May 29, 2014 11:28 am
- Forum: Permanent Portfolio Discussion
- Topic: How 2 assets with negative returns and negative correlations can make money
- Replies: 44
- Views: 24691
How 2 assets with negative returns and negative correlations can make money
So the PP carries Stocks, LT Treasuries, ST Treasuries, and Gold? And only Stocks produce real returns over the long run? Then why does it generate a return that's competitive to the 100% Equities allocation? And why does the 60/40 Stock/Bond portfolio also generate a similar long-term return as ...
- Tue May 20, 2014 12:39 am
- Forum: Permanent Portfolio Discussion
- Topic: PP is not as Passive as you might think..
- Replies: 21
- Views: 10453
Re: PP is not as Passive as you might think..
Rebalancing based on target portfolio percentages is different to me because it is future-neutral. It makes adjustments based on your present-day portfolio, not what you think it will look like a month from now. That's why rebalancing based on target percentages is often painful -- it may often g...
- Sun May 18, 2014 12:52 pm
- Forum: Permanent Portfolio Discussion
- Topic: PP is not as Passive as you might think..
- Replies: 21
- Views: 10453
PP is not as Passive as you might think..
Actually, any asset allocation with a set of default weights for each asset and a rebalancing corridor is not completely passive. Let's take a look at a very simple asset allocation: 50% Stocks, 50% bonds, a 10% rebalancing corridor on either side (so if something reaches 40% or 60%, we rebalance to...
- Fri May 16, 2014 7:30 pm
- Forum: Variable Portfolio Discussion
- Topic: HFT (High Frequency) PP
- Replies: 3
- Views: 3069
Re: HFT (High Frequency) PP
So at least 73% of the time you are invested 100% USD? On second thought, it's fine to hold overnight as long as you rebalance first thing each morning.. holding overnight positions is like breaking one of the 10 commandments in HFT but we do that all the time with our passive PPs. Still looking f...
- Fri May 09, 2014 6:23 pm
- Forum: Variable Portfolio Discussion
- Topic: HFT (High Frequency) PP
- Replies: 3
- Views: 3069
HFT (High Frequency) PP
We've got a variety of different "enhanced" versions of PPs around here: leveraged PPs, LEAPs PPs, momentum-based PPs, etc. here.. So I'd like to float another idea around: The High Frequency PP. Note: you'd need an algorithmic trading platform and preferably be physically located close to...
- Fri Apr 25, 2014 8:42 am
- Forum: Other Discussions
- Topic: If the Permanent Portfolio Were a Game
- Replies: 11
- Views: 4588
Re: If the Permanent Portfolio Were a Game
I kinda think of it as Zugzwang in chess.. but unlike chess, you don't have to make a move in investing if you don't want to.
- Wed Apr 23, 2014 9:38 am
- Forum: Other Discussions
- Topic: Homeownership is Overrated
- Replies: 56
- Views: 19748
Re: Homeownership is Overrated
I think homeownership would make a lot more sense if we could begin to apply some new technology to the industry and get past our culturally conceived ideas of what a "home" is supposed to look like. There is no reason why a weathertight, pest resistant, comfortable, safe 2 bedroom 2 bath...
- Mon Apr 21, 2014 10:24 pm
- Forum: Other Discussions
- Topic: Location Independence
- Replies: 28
- Views: 13202
Re: Location Independence
You've read the 4 Hour Work Week 1 too many times.. Not saying I wouldn't dig that lifestyle as well.. There's another blogger, Chris Guillebeau, who used to talk about running his businesses while he volunteered in West Africa several years ago. It seems running an online business is a prerequisit...
- Mon Apr 21, 2014 10:16 pm
- Forum: Other Discussions
- Topic: 28 Killer Home Trading Desks From All Around The World
- Replies: 1
- Views: 1154
28 Killer Home Trading Desks From All Around The World
http://www.businessinsider.com/trading- ... 014-4?op=1
Either we're lazy or they're trying very hard to beat the PP..
Either we're lazy or they're trying very hard to beat the PP..
- Sat Apr 19, 2014 11:57 pm
- Forum: Permanent Portfolio Discussion
- Topic: What % of your Total Portfolio is the PP?
- Replies: 26
- Views: 13797
Re: What % of your Total Portfolio is the PP?
I'm using nonstandard implementations of the PP, so depending on how you define it, either 0% or 100%
PP #1 (taxable account):
25% SPY
25% GLD
25% TLT
25% UUP
PP #2 (IRA), the leveraged PP:
1/3 UGL
1/3 SSO
1/3 UBT
PP #1 (taxable account):
25% SPY
25% GLD
25% TLT
25% UUP
PP #2 (IRA), the leveraged PP:
1/3 UGL
1/3 SSO
1/3 UBT
- Mon Apr 14, 2014 8:28 pm
- Forum: Permanent Portfolio Discussion
- Topic: Whitepaper by R. Ferri & A. Benke (2013) - Compares Index Portfolios v. Managed
- Replies: 3
- Views: 3747
Re: Whitepaper by R. Ferri & A. Benke (2013) - Compares Index Portfolios v. Managed
So? I'm about halfway done reading his entire blog and it seems he and Craig or Harry Browne would agree on many things.. except maybe gold.Libertarian666 wrote: Rick Ferri may be a smart guy but when it comes to gold he has a major blind spot. So I take anything he says with several grains of salt.
- Mon Apr 14, 2014 3:35 pm
- Forum: Permanent Portfolio Discussion
- Topic: YTD Results of Permanent Portolio with/out Cash
- Replies: 17
- Views: 12333
Re: YTD Results of Permanent Portolio with/out Cash
Keep in mind Cash used to pay out very high interest decades ago.. in the 1970s and 80s. (My dad immigrated to the US in the early 80s and his first impression of American banks were the double digit interest rates they paid to save money there.) We've been accustomed to low interest rates since ...
- Tue Apr 08, 2014 9:02 am
- Forum: Permanent Portfolio Discussion
- Topic: YTD Results of Permanent Portolio with/out Cash
- Replies: 17
- Views: 12333
Re: YTD Results of Permanent Portolio with/out Cash
I'm going with 0 cash (and 2x leveraged etfs) with my PP in my IRA.. F-- drawdowns and volatility - I can't get my hands on that money until many decades later anyways. As for my taxable accounts which I'll draw on in an emergency, I go with the standard HB PP.
- Fri Apr 04, 2014 2:34 pm
- Forum: Other Discussions
- Topic: Are you a stock or bond in life?
- Replies: 8
- Views: 3291
Are you a stock or bond in life?
http://www.cnbc.com/id/101519763 Stock: A career path with high pay but high instability. Examples: Entrepreneurship, Finance, Tech, etc. Bond: A career path with low pay and high stability. Examples: Government, tenured professors, medicine, etc. It seems PP may be more suitable for people with a...
- Fri Apr 04, 2014 10:48 am
- Forum: Permanent Portfolio Discussion
- Topic: Oklahoma Authorizes Gold as Legal Tender
- Replies: 21
- Views: 9058
Re: Oklahoma Authorizes Gold as Legal Tender
Will people's salaries be in gold? Will minimum wage be indexed to gold? It'll be a problem if gold goes to 3000, otherwise I don't see much harm.
- Fri Apr 04, 2014 10:47 am
- Forum: Permanent Portfolio Discussion
- Topic: How to distribute monthly contributions?
- Replies: 5
- Views: 4240
Re: How to distribute monthly contributions?
In the beginning, just transfer the cash in and if cash hits a rebalancing band, do it (and restore to 25/25/25/25.) When you've been regularly contributing for a few years (like me), you can take your monthly distribution and use it to buy the lowest weight asset if there's a huge difference betwee...