Is the PP going to hold up?

General Discussion on the Permanent Portfolio Strategy

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banker22
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Re: Is the PP going to hold up?

Post by banker22 » Mon Mar 26, 2018 5:22 pm

buddtholomew wrote:
stuper1 wrote:Aren't you happy that it's up 5.7% in the last 12 months? Sure beats a savings account at the bank.

Keep in mind though that a PP has historically suffered drawdowns as much as 20% or more, so it's definitely not as safe as a savings account.
Personal CAGR for PP is around 4.25% since I started.
My 70/30 has tripled since 2008.
Can’t even compare the 2 with a straight face.
Did you ever pull the trigger?

I am considering entering very slowly by building my cash portion up first. If I know my target FIRE number is X, for example, and I am currently at 0.1X and will reach X in 5 years, I will spend the first year or so building my cash pile up to 0.25X, then the next 3-4 years adding the final 0.75X on a 33/33/33 basis so upon retirement (X) I have a balanced PP. Has anyone else ever used this approach? It makes me feel a little more comfortable given what others on this thread have mentioned (clearly overvalued stocks and bonds). Or maybe I go 50/50 cash gold first...or maybe just take the plunge!
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vnatale
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Re: Is the PP going to hold up?

Post by vnatale » Fri Jan 17, 2020 6:51 pm

jhogue wrote:
Sun Feb 11, 2018 10:39 am
If Buddtholomew did not exist, this forum would have to invent him.

Keeping a perpetual worrier around lets the rest of us see just how ridiculous it is to try to micro-manage the Permanent Portfolio

Thanks, Bud.
Reading so many of these old posts in a relatively compressed period of time is somewhat similar to watching many seasons of a TV series also in a relatively compressed period of time. In both cases you get to know a lot of the characters involved!

Vinny
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats."
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Re: Is the PP going to hold up?

Post by vnatale » Fri Jan 17, 2020 6:56 pm

dualstow wrote:
Thu Mar 01, 2018 1:20 pm
Roy wrote:Greetings,

It is useful revisiting those threads—way back to the olden days—and what it felt like living through those times.

If one did not fret over the dailies, the experience was and remains, dust in the wind…


Volatile parts, sure. Valuations too rich, I suppose. Too funky, yep. But portfolio-as-a-whole rarely looked this good. Especially when not looking at it. I suspect much the same might be said 10 years from now.

Peace
Nice! I like revisiting old threads, too. Should do that more often.
Let me be your guide...…

Vinny
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats."
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Re: Is the PP going to hold up?

Post by dualstow » Fri Jan 17, 2020 8:27 pm

vnatale wrote:
Fri Jan 17, 2020 6:51 pm
jhogue wrote:
Sun Feb 11, 2018 10:39 am
If Buddtholomew did not exist, this forum would have to invent him.

Keeping a perpetual worrier around lets the rest of us see just how ridiculous it is to try to micro-manage the Permanent Portfolio

Thanks, Bud.
Reading so many of these old posts in a relatively compressed period of time is somewhat similar to watching many seasons of a TV series also in a relatively compressed period of time. In both cases you get to know a lot of the characters involved!

Vinny
We buried Budd’s gold in the desert next to Hank. (Shhhhhh!)
https://www.city-journal.org/journalism-advocacy-over-reporting
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vnatale
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Re: Is the PP going to hold up?

Post by vnatale » Fri Jan 17, 2020 9:02 pm

dualstow wrote:
Fri Jan 17, 2020 8:27 pm
vnatale wrote:
Fri Jan 17, 2020 6:51 pm
jhogue wrote:
Sun Feb 11, 2018 10:39 am
If Buddtholomew did not exist, this forum would have to invent him.

Keeping a perpetual worrier around lets the rest of us see just how ridiculous it is to try to micro-manage the Permanent Portfolio

Thanks, Bud.
Reading so many of these old posts in a relatively compressed period of time is somewhat similar to watching many seasons of a TV series also in a relatively compressed period of time. In both cases you get to know a lot of the characters involved!

Vinny
We buried Budd’s gold in the desert next to Hank. (Shhhhhh!)

Good one, dualstow!!

Vinny
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats."
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Re: Is the PP going to hold up?

Post by Roy » Mon Jan 20, 2020 8:44 am

The original PP has been the approach most doomed to fail—going back to its authoritative critics on the epic BH thread and beyond.

For years it’s been—Bond bull over, Treasuries too long, too few Stocks, too much Gold (and its followers misunderstanding the role of Gold), too much money wasted in Short-term fixed income. And not diversified enough (compared to portfolios that are actually less genuinely diversified).

I’m not sure there has been a simple investment plan so throughly criticized—and which has performed as advertised (with emphasis on the “don’t lose" part), for so long, across so many environments. Ironically, the S&P 500 is similar—behaving as-advertised over the long term—but then one must accept those big losing years and drawdowns, which if not accepted, means abandoning the strategy.

The key seems to be not scrutinizing the portfolio (any portfolio) as it does its work.

I remain a nostalgic slob and will always remember the legendary PP discussions.

Best to all.

Roy
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Re: Is the PP going to hold up?

Post by Vil » Mon Jan 20, 2020 10:57 am

Not sure here's the right place to put this post, but anyway..

I (think) am aware of the role of stocks in PP, though a question is bothering me since some time - do you think a "minimum volatility" vs normal stock-tracking ETFs is a subject of debate ? Is there a real benefit of holding a minimum volatility ETF, if its being re-balanced semi-annually and actually financial turmoils normally last mostly less than a year (well, definitely relying on history, here).

Regards,
Vil
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Re: Is the PP going to hold up?

Post by vnatale » Mon Jan 20, 2020 11:26 am

Roy wrote:
Mon Jan 20, 2020 8:44 am
The original PP has been the approach most doomed to fail—going back to its authoritative critics on the epic BH thread and beyond.

For years it’s been—Bond bull over, Treasuries too long, too few Stocks, too much Gold (and its followers misunderstanding the role of Gold), too much money wasted in Short-term fixed income. And not diversified enough (compared to portfolios that are actually less genuinely diversified).

I’m not sure there has been a simple investment plan so throughly criticized—and which has performed as advertised (with emphasis on the “don’t lose" part), for so long, across so many environments. Ironically, the S&P 500 is similar—behaving as-advertised over the long term—but then one must accept those big losing years and drawdowns, which if not accepted, means abandoning the strategy.

The key seems to be not scrutinizing the portfolio (any portfolio) as it does its work.

I remain a nostalgic slob and will always remember the legendary PP discussions.

Best to all.

Roy
Roy,

Shortly after I read this, I read one of the "legendary PP discussions" - "I'm Done!". As you just did here you also participated in that one. And, you were steadfast in both Topics. Thanks for that. It helps reassure me.

Vinny
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats."
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