BelangP & PP

[johnnywitt]

Out of all the popularized portfolios in the market of investment ideas, I don't really know of one that is more "black swan proof" than the PP. The biggest challenge with the PP is just getting people to accept it and stick with it. Gold makes people nervous. Long treasury bonds make people nervous. People don't like to see such a small allocation to stocks.

To the extent in which proclivity towards adoption is part of the criteria for evaluating a portfolio the PP actually fails miserably. It's a niche portfolio that appeals to preppers, gold bugs, and those who are maybe a bit too well-versed in geopolitics. That crew happens to be my jam. (Love all you guys. )

I think a better "gateway drug" portfolio (NSA, I'm talking about investing, not drugs.) is a combination of the Desert Portfolio + Larry Portfolio.

- 30% globally diversified equity with factor tilting (size, value, momentum, quality)
- 10% gold
- 60% 5 year treasury bonds (globally diversified sovereigns with currency hedging)

This gives you many of the benefits of the PP but also allows you to get as much juice from the squeeze as possible in the small equity allocation. Once someone buys into this kind of esoteric approach, full adoption of the PP may not be far off.

Wow Smith, that was a great post!