in depth review of golden butterfly

[mathjak107]

https://www.quantifiedstrategies.com/go ... portfolio/

[yankees60]

https://www.quantifiedstrategies.com/go ... portfolio/

Some responses / questions.

1) Who IS Quantified Strategies? I went around the web site and did not find any names. I did see this: "We have written over 1200 articles on this blog since we started in 2012." I have learned that there is a "royal" we, meaning that "we" can be entirely composed of just one person. Curious why this web site does not reveal who composes Quantified Strategies, telling us all about them to give them more credibility based upon whatever success they can tell us that they have had in the past.

2) It starts with: "The Golden Butterfly Portfolio by Tyler portfolio" and then later on has: "The Golden Butterfly Portfolio is a relatively new investment strategy, having only gained popularity in the past decade. It was developed as a response to the financial crisis of 2008, as investors were seeking a more diversified and balanced portfolio that could weather economic uncertainty."

I know that The Golden Butterfly Portfolio is a Tyler invention. However, I thought it was a fairly recent invention sometime in the last three years? Or, was it created closer to 2008 and I read about it a few years ago during my extensive exploration in the forum archives?

3) Overall looks like a solid, thorough assessment of it. Thanks for putting it here.

[snedgar]

The article seems cluncky and uninspired to me.

I wonder if it was written by AI?

[coasting]

The article seems cluncky and uninspired to me.

I wonder if it was written by AI?

I wonder if it was written by AI? lol - I had exactly the same thought!

[yankees60]

Did not appear that way to me.

Also, if you go here: https://www.quantifiedstrategies.com/# ......

..... you will see other similar analyses which presumably were written before AI became available?

[flyingpylon]

This is just “SEO Content” designed to perform well with search engines. There’s no real analysis. The goal is to attract people searching for various investment strategies and convert them to a paid membership.

[yankees60]

This is just “SEO Content” designed to perform well with search engines. There’s no real analysis. The goal is to attract people searching for various investment strategies and convert them to a paid membership.

I did definitely notice that there was a strong push to get someone to choose the paid option.

[Tyler]

Yeah, that looks like a good example of classic SEO farming where the main goal is keyword density -- even moreso than accuracy.

2) It starts with: "The Golden Butterfly Portfolio by Tyler portfolio" and then later on has: "The Golden Butterfly Portfolio is a relatively new investment strategy, having only gained popularity in the past decade. It was developed as a response to the financial crisis of 2008, as investors were seeking a more diversified and balanced portfolio that could weather economic uncertainty."

I know that The Golden Butterfly Portfolio is a Tyler invention. However, I thought it was a fairly recent invention sometime in the last three years? Or, was it created closer to 2008 and I read about it a few years ago during my extensive exploration in the forum archives?

Among other inconsistencies (it is/isn't diversified, it does/doesn't include commodities), the history quoted in the linked article is false. My first article about the Golden Butterfly was published in 2015, and you'll find no mention at all of the 2008 financial crisis. In fact, the discussions on this forum are probably the best record you'll find of my thought process.

[seajay]

Yeah, that looks like a good example of classic SEO farming where the main goal is keyword density -- even moreso than accuracy.

2) It starts with: "The Golden Butterfly Portfolio by Tyler portfolio" and then later on has: "The Golden Butterfly Portfolio is a relatively new investment strategy, having only gained popularity in the past decade. It was developed as a response to the financial crisis of 2008, as investors were seeking a more diversified and balanced portfolio that could weather economic uncertainty."

I know that The Golden Butterfly Portfolio is a Tyler invention. However, I thought it was a fairly recent invention sometime in the last three years? Or, was it created closer to 2008 and I read about it a few years ago during my extensive exploration in the forum archives?

Among other inconsistencies (it is/isn't diversified, it does/doesn't include commodities), the history quoted in the linked article is false. My first article about the Golden Butterfly was published in 2015, and you'll find no mention at all of the 2008 financial crisis. In fact, the discussions on this forum are probably the best record you'll find of my thought process.

There were some discussions along the lines of the GB back in 2009, such as
https://www.bogleheads.org/forum/viewto ... 85#p491985
but as you say the formal "Golden Butterfly" came years later. Recall the mentioning in a 2009 or 2010 post of a Variable Portfolio comprised of SCV alongside a PP, but some of the older posts have been deleted and I've not managed to search/find that.

[mathjak107]

Yeah, that looks like a good example of classic SEO farming where the main goal is keyword density -- even moreso than accuracy.

2) It starts with: "The Golden Butterfly Portfolio by Tyler portfolio" and then later on has: "The Golden Butterfly Portfolio is a relatively new investment strategy, having only gained popularity in the past decade. It was developed as a response to the financial crisis of 2008, as investors were seeking a more diversified and balanced portfolio that could weather economic uncertainty."

I know that The Golden Butterfly Portfolio is a Tyler invention. However, I thought it was a fairly recent invention sometime in the last three years? Or, was it created closer to 2008 and I read about it a few years ago during my extensive exploration in the forum archives?

Among other inconsistencies (it is/isn't diversified, it does/doesn't include commodities), the history quoted in the linked article is false. My first article about the Golden Butterfly was published in 2015, and you'll find no mention at all of the 2008 financial crisis. In fact, the discussions on this forum are probably the best record you'll find of my thought process.

i guess you have never seen this site before ?

[Tyler]

i guess you have never seen this site before ?

It's new to me, and your link is the first time I've seen it. Thanks for sharing!

[mathjak107]

i guess you have never seen this site before ?

It's new to me, and your link is the first time I've seen it. Thanks for sharing!

and thank you for having such a cool site

[mathjak107]

the article is definitely flukey ..

first it’s a misconception that it’s diversified but then they go on to it is a well diversified portfolio .

i like the 10% gold 10% dbc part too , where did they come up with that ? the funny thing though is i use gld/iau and some dbc but i got that from paul tudor jones who at one time liked to split the gold budget with bitcoin , gold , commodities and cash for inflation protection

[ochotona]

Tyler, I have a question I've been meaning to ask. Is there an argument to be made for global equities in the GB? 40% VT? I know it wouldn't back-test very well, because International equities have been taken out behind the shed and butchered for a long time, but you... "Buy low sell high".

Also, I recommend portfoliocharts to every single person I meet online in financial spaces.

[Tyler]

Thanks for spreading the word!

I'm no Harry Browne, but I imagine he might say that the portfolio is designed to capture the flow of money out of equities rather than capture the flow of equities money out of the country. That said, I don't have a problem with anyone who feels strongly about global diversification.

And there's definitely an argument to be made for global equities if one lives in a country with a small economy. If a global fund is heavily US-weighted anyway, US investors can't go wrong either way. But the decision for someone living in a country with a tiny slice of the global pie gets a little more interesting.

[mathjak107]

if japanese investors invested in american markets all these years instead of their own they wouldn’t be the poster children for what happens when you have a long time bear market

[ochotona]

Better Buy and Hold will design a portfolio very very close to the GB if you select the GB assets and the criterion "build a portfolio that has never lost more than 10% in 36 months". And it does better if you add in EM, but not if you add in EM and EAFE!

If you round it off, you get something like this:

20% Gold, Cash, US Large Cap
15% LT Treasuries
12.5% Small Cap and EM

https://betterbuyandhold.com/what-we-do/

[yankees60]

Better Buy and Hold will design a portfolio very very close to the GB if you select the GB assets and the criterion "build a portfolio that has never lost more than 10% in 36 months". And it does better if you add in EM, but not if you add in EM and EAFE!

If you round it off, you get something like this:

20% Gold, Cash, US Large Cap
15% LT Treasuries
12.5% Small Cap and EM

https://betterbuyandhold.com/what-we-do/

It seems intriguing. However, when you go here: https://betterbuyandhold.com/our-origin-story/

And, the first and third URLs on the bottom of page go to nowhere ... does that make you question at all the organization's competence?

[ochotona]

It seems intriguing. However, when you go here: https://betterbuyandhold.com/our-origin-story/

And, the first and third URLs on the bottom of page go to nowhere ... does that make you question at all the organization's competence?

No, not really. The publisher of the 3rd URL links moved the document. I can email BBH. BBH also does AllocateSmartly, probably 99% of their focus goes to AS, and they do a great job over there.

[ochotona]

For your entertainment, I present - The GMO Butterfly

1/5 to each of these ETFs

Foreign Small Cap SCHC
EM Value AVES
Long Term Treasuries SCHQ
Gold SGOL, or hold physical
Cash SGOV, or hold I-Bonds, T-Bills, bank deposits

I've started to DCA into this. For those of you who don't know GMO, here is a link, not to them, but to someone commenting on them. GMO hides their stuff behind a subscription wall, and I can't sign up for it with Gmail.

We'll know in seven years if their seven year forecast was any good!

[joypog]

Damn...all in on foreign equities. Hope it works out!

(ps, any reason you went small cap foreign instead of foreign SCV?)

[ochotona]

Damn...all in on foreign equities. Hope it works out!

(ps, any reason you went small cap foreign instead of foreign SCV?)

This portfolio is just a really little part of my holdings at present. I'm going to watch it for 2-3 years then decide if I should grow it. EM Value and Small Cap Ex-US are the top two equity class picks from GMO.