Always on sale!

General Discussion on the Permanent Portfolio Strategy

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joypog
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Always on sale!

Post by joypog » Sat Mar 25, 2023 5:18 pm

I just realized that there is a rarely mentioned behavioral benefit to the Risk Parity approach – even during accumulation.

"being diversified means you’re always losing" = something is ALWAYS on sale!

I grok the William Bernstein sentiment “get on your hands and knees and pray for a market crash”, but it’s always rubbed me wrong. Even though it may be true for a young professional who avoids layoffs, a bad economy exacts a tremendous toll on individuals and families.

With an RP style portfolio, there is always a good deal in the market, no matter what the economy is doing.

Even in an everything-hot economy (bizarro-2022) an RP portfolio will always have something cheap to buy - Cash!
1/n weirdo. US-TSM, US-SCV, Intl-SCV, LTT, STT, GLD (+ a little in MF)
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vnatale
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Re: Always on sale!

Post by vnatale » Sat Mar 25, 2023 5:41 pm

joypog wrote:
Sat Mar 25, 2023 5:18 pm

I just realized that there is a rarely mentioned behavioral benefit to the Risk Parity approach – even during accumulation.

"being diversified means you’re always losing" = something is ALWAYS on sale!

I grok the William Bernstein sentiment “get on your hands and knees and pray for a market crash”, but it’s always rubbed me wrong. Even though it may be true for a young professional who avoids layoffs, a bad economy exacts a tremendous toll on individuals and families.

With an RP style portfolio, there is always a good deal in the market, no matter what the economy is doing.

Even in an everything-hot economy (bizarro-2022) an RP portfolio will always have something cheap to buy - Cash!


What IS the correlation between the two? Aren't sometimes the market and the economy disconnected from one another?
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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joypog
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Re: Always on sale!

Post by joypog » Sat Mar 25, 2023 8:11 pm

sometimes...but they are often related too.
1/n weirdo. US-TSM, US-SCV, Intl-SCV, LTT, STT, GLD (+ a little in MF)
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