I like it.  I imagine it will be a bit more volatile than the PP, but with greater reward in the long run.

I'm doing something similar in my 401k, because it has a cheap bond index fund available, plus I feel stupid having a big chunk of cash in a long-term vehicle when I'm nowhere near retirement.

PS,

Does that modified GB look like this:  20% LCB, 20% SCV, 40% BLV, 20% gold?

So, over the last 10 years, you've gotten a CAGR that was 2.8% higher than the HBPP, with minimal extra effort, and the MaxDD was only 2.5% greater based on monthly results.  To me, that just seems awesome.  I wish I could give you a high-five or fist bump over the internet.  If I knew how to use em...

IG,

You should write a book.  That performance seems phenomenal to me.  Thank you for sharing your ideas with us.  Do you happen to know the MaxDD for the HBPP over that time period?

So I do Top2 Yearly with other asset classes in addition to the PP classes.  I have only been tracking my results monthly so my MaxDD is probably more than the number in my monthly spreadsheet.  Anyways, from 2006-2015 I had 9.7% CAGR with MaxDD -14.5% from Feb 2008 to Oct 2008. Is that CAGR real o...

Yes, I agree with you 100% that reaching the target audience will be the hardest thing. I think there are two types of one-on-one advice that are currently being offered.  The first is fairly expensive (especially from a young person's perspective) from someone like a certified financial planner.  T...

I've been thinking of starting an online business to provide investing advice to young people who want to get started investing in 401k's, IRA's, etc., but need some help.  I read an article yesterday based on a survey that reported that what these young people really want is a one-on-one advisor.  ...

2.5% extra CAGR a year, with little added potential drawdown risk, is huge , especially considering that a lot of people rebalance each year anyway.  All this involves is just looking at the previous year's results for each asset, and then switching your momentum assets if necessary, which as I post...

Whatever the true MaxDD for the PP, the recovery time is about half what it is for a lot of other portfolios.  It's good to know beforehand that 20 to 25% drawdown is possible.  That way if it happens, you can just clench your fists and hold on, rather than capitulating and locking in losses.

stuper - since you asked, here is what the PP+SCV looks like using the same data only trading semianually.  For those of you at home, this is still a 12 month lookback just trading 2x/year instead of once.  The patterns and ideal pick are very similar across the two scenarios.  Could be worth it if...

IG,

I sent you a PM.

I think that Dual Momentum seems worth the bother to either increase your return or reduce your MaxDD.  It really just means a few extra trades 1 day/year. Next up I'm going to try and get Russell 2000 daily results back to 1979 and run that through a similar process for the PP+SCV scenario.  It ma...

InsuranceGuy, There is something I noticed in both of our results that is very intriguing to me.  With a PP+Top-2-MOM strategy, the maximum single year drawdown increases as you increase the percentage allocated to the Top 2.  This is what I would expect.  However, with a PP+SCV+Top-2-MOM strategy,...

InsuranceGuy, Very nice spreadsheet.  Thank you for sharing that.  Much more elegant than my own.  My returns are slightly lower than yours because, I think, I used "cash/money market" returns for cash rather than "short term treasuries".  Overall my results are consistent with y...

Seems like a free lunch.  The chart below shows the rolling 5-year average real returns for the two portfolios. Don't be fooled.  It's an artifact of using low sample data.  If you only sample once a year as with annual returns, you miss the sequence of downside risk in-between.  In all cases, mome...

The percentage of the time in the Top 2 for each asset was as follows: Large Cap Blend              26.1% Small Cap Value              28.4% Long Term Treasuries      17.0% Gold                              18.2% Cash/Money Market        10.2% LCB and SCV were in the Top 2 together 34% of the time. ...

Here are the real inflation-adjusted CAGRs and worst year returns for different percentages of the Base portfolio (5x20 golden butterfly) plus remainder in the Top 2 assets from the previous year, trading once per year and backtested using annual returns only.  Notice that at 30% Base plus 35% each ...

I downloaded annual returns from portfoliovisualizer.com to create my own backtesting spreadsheet for the PP+SCV+Top-2-MOM strategy.  The numbers work out a bit differently from InsuranceGuy's but generally the same.  It seems like much of the outperformance was in the 1970s when gold was going craz...

InsuranceGuy, I have some questions about your HB+SCV+top 2 MOM strategy.  Let's say that stocks do good one year, better than everything else.  That means the next year you would have 76% of your portfolio in stocks (38% in large cap, 38% in small cap value) with only 8% long bonds, 8% gold, and 8...

InsuranceGuy, I have some questions about your HB+SCV+top 2 MOM strategy.  Let's say that stocks do good one year, better than everything else.  That means the next year you would have 76% of your portfolio in stocks (38% in large cap, 38% in small cap value) with only 8% long bonds, 8% gold, and 8%...

This strategy to me is very intriguing.  I almost find it to sound too good to be true.  If I'm reading this right, you're saying that we might get a 2 - 3 % increase in real CAGR over the HBPP and keep the maximum single year drawdown at about the same level or even lower.  Is that correct?  Am I r...

I've used TaxAct online for several years and have been very happy with it.

The estate tax exemption is $10.9 million per couple.  I'm pretty sure we'll be under that, so I don't see what we have to fear from the Revenuers.

I believe once the gold passes to our heirs, then they get a stepped up tax basis to the current price per ounce of gold in effect at that time.

dragoncar wrote:

Reub wrote: So is the PP only as good as its gold component?

These days, yes

This may come as a shock, but gold is really the only thing that differentiates the PP from a boglehead portfolio.

Reub wrote: Who will take care of your physical gold when you are 90 and possibly in a nursing home?

It will be sitting in the bank safe deposit box waiting to pass to our heirs via our wills.