Better Portfolio than Permanent Portfolio is ###### *******

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frugal
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Better Portfolio than Permanent Portfolio is ###### *******

Post by frugal » Sat Apr 29, 2017 12:09 am

Hello,

I read a lot of questions, a lot of threads, asking about the quality of the PP.


Up to now, I couldn't find any better.

Haters and other friends:

Can you please tell me what other solutions (portfolios) are a good option?


Thank you for your answers!
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by mathjak107 » Sat Apr 29, 2017 2:33 am

depends what your goals are . if it is gains and growing a lot more money the pp was not the place to be historically .

personally i think the gb is a better real world mix . but there are models that perform better if as usual things "are not different this time " than the gb if gains are your thing and are a long term investor . i would not have met goal to retire on just the pp .

so you need to define " better"
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by ochotona » Sat Apr 29, 2017 5:50 am

I don't think an all-or-nothing mindset helps you. Every portfolio performs differently. You can use the strengths of each to help you by in-filling the weaknesses of others. I think it's entirely a reasonable idea to think about blending the Permanent Portfolio with other strategies. That's called a "core-satellite" approach, or PP+VP.

I own US equities, International equities, cash, T-Bonds, gold, REITs. I'll bet if you drew the dotted lines carefully enough, you'd find the perfect little Permanent Portfolio in there somewhere, surrounded by peripheral "stuff". That other stuff I trade using Dual Momentum.

So I do have a PP in there, somewhere, though I don't think about it very much as a "thing" in and of itself. I just have all of the four PP components right now because I want each of them to do different things for me, I want them to play the roles they often play in inflation, deflation, prosperity, and contraction.

I do Core-Satellite because I think Dual Momentum can give me more growth before I retire, but I also want to ensure against inflation and maybe even currency problems (gold), I need a big slug of cash and bonds because I'm in an insecure industry and they comprise a YUUUGE emergency fund, and also I think stocks will go on a big sale in the next few years (don't ask me when).

I have every expectation at the end of my life I'll pretty much be left with a PP or something very close to it. Between now and then, the next 30-40 years hopefully, will be a time of transition and rolling-on and rolling-off Dual Momentum as conditions change.
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by AnotherSwede » Sat Apr 29, 2017 10:43 am

frugal wrote:Can you please tell me what other solutions (portfolios) are a good option?
I'll tell you why PP doesn't work, can't tell you what to do instead.

No bonds beyond 10Y in Sweden, and no mutual funds with duration > 3 years and without a lot of corporate bonds.

It is silly having cash to no interest while having a floating rate mortgage.

Gold has some local drawbacks and anyway maybe doesn't work as intended for non-reserve currencies.
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by stuper1 » Mon May 01, 2017 10:59 am

Frugal,

One big question you have to ask yourself is: how much time will you realistically be able to put into your portfolio management? How often are you really going to be able to check in on things and make changes if necessary? If you can commit to doing that say once a month, then you can probably get better returns than the PP with something like Dual Momentum. If, however, you are like me, and really can't commit to checking things more than every 6 months or one year, then you are probably better off with the PP or Golden Butterfly or something like that, depending on your risk tolerance and other goals.
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by escafandro » Mon May 01, 2017 6:42 pm

I do not know if it's better, but at least it's better for me.
Steal the percentages of MachineGhost who in turn steals the idea of Clive as he says.
viewtopic.php?f=1&t=7920&hilit=clive+40 ... 12#p135697

30% Global Stocks
10% Global REIT
32% US Bonds
17% Gold
11% US Cash

Not too much gold not so little, same with cash, and with some REITs because I like them.
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by mathjak107 » Wed May 03, 2017 3:57 am

stuper1 wrote:Frugal,

One big question you have to ask yourself is: how much time will you realistically be able to put into your portfolio management? How often are you really going to be able to check in on things and make changes if necessary? If you can commit to doing that say once a month, then you can probably get better returns than the PP with something like Dual Momentum. If, however, you are like me, and really can't commit to checking things more than every 6 months or one year, then you are probably better off with the PP or Golden Butterfly or something like that, depending on your risk tolerance and other goals.
i used a fidelity fund oriented newsletter for 30 years . i could put portfolio's together in my sleep but i much prefer the newsletter .

for one thing i never have to 2nd guess my last move or plan the next and i like having a portfolio that is dynamic and changes over time to better fit the changes in the bigger picture .

so i spent about 30 seconds a week on actual mgmt . i read an update every friday .

it is also simple for my wife to do without me involved if i am plant food .

as far as results , the growth model i use has returned 11% a year average cagr for more than 30 years , a total market fund returned closer to 10% so that difference is about 30% in balance with less volatility at times so staying dynamic can certainly pay off .

while i still run that growth model for my money i won't need to eat with in the next 12 -30 plus years i do run a growth and income model for eating in 6-11 years and an income model for current income . but using the newsletter makes it literally a few second thing running 3 opimized portfolio's for 3 different time frames and purpose.

one of the problems not using specialized guidance that really knows what is contained in what you use is that overlap between funds can be bad . you can buy even index funds and have so many over lapping issues without realizing it because many index funds use different indexes that take in the same identical holdings even though you thought you were buying a large cap-midcap smallcap index.

fidelity maintains a central core fund that their less experienced managers have to pick stocks from . these have been approved by the analysts .

so you can put together a bunch of funds that seem different and end up with FANG in all of them if you do not know current major holdings and those are not updated all that frequently in morningstar and other places that track composition .

you can buy what seems like a nice index combo from vanguard using a s&p 500 fund , a mid cap and small cap fund and have very bad over lap in holdings .

the trinity as it is called VOO -VO -VB is so popular yet the index's mesh terribly .

there is so much overlap .

on the other hand using i-shares IVV IJH IJR has zero overlapping holdings .

so it helps to have a source who tracks what goes on in what you buy even if you buy index funds ..

whatever you do, sticking to the plan will account for most of your outcome . any plan can work if you have the fortitude to follow it through.

even retiree's in 100% equities and spending down in good and bad times have had a very very high success rate over 115 rolling 30 year periods so a lot of what we believe about high equity positions is hog wash and myth circulated by other misinformed people .

it does not mean mentally we can take that volatility , but mental reasons are very different from financial reasons for not doing something.

i couldn't take the volatility of such high equity positions in retirement . but the lack of drag from cash and bonds on those high equity positions in the up markets would have provided a much larger cushion that weathered down turns with not much problem at all .

in fact having cash buffers for spending in down markets has actually reduced your income and balance far more often than added any value , yet we all do it , self included . but i keep 1 years spending money in cash instruments and use the income model portfolio to provide income and refill that 1 year every jan 1st .

this is our 3rd year in retirement spending down , and now our balance is higher than when we started . despite spending down for 2-1/2 years our balance is the highest ever as of last night . so now we don't hold 2 years cash anymore liquid just the current year's spending in laddered cd's . .
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by tim47 » Wed May 03, 2017 1:21 pm

I am also in retirement, Using GB as basic allocation model. Wondering which Fidelity newsletters you might suggest to augment this..... thanks in advance...
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by mathjak107 » Wed May 03, 2017 1:45 pm

i have been using fidelity insight for 30 years
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by Libertarian666 » Wed May 03, 2017 6:14 pm

It's very simple. Just own things that go up rapidly, and skip everything else. Win!
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by frugal » Thu May 04, 2017 12:13 am

stuper1 wrote:Frugal,

One big question you have to ask yourself is: how much time will you realistically be able to put into your portfolio management? How often are you really going to be able to check in on things and make changes if necessary? If you can commit to doing that say once a month, then you can probably get better returns than the PP with something like Dual Momentum. If, however, you are like me, and really can't commit to checking things more than every 6 months or one year, then you are probably better off with the PP or Golden Butterfly or something like that, depending on your risk tolerance and other goals.
Hello,

is that a portfolio with good track record?

I don't think it is a question of time. It is a question of returns %.

I tried several years for active trading and it is tough...
:-\
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by frugal » Thu May 04, 2017 12:16 am

escafandro wrote:I do not know if it's better, but at least it's better for me.
Steal the percentages of MachineGhost who in turn steals the idea of Clive as he says.
viewtopic.php?f=1&t=7920&hilit=clive+40 ... 12#p135697

30% Global Stocks
10% Global REIT
32% US Bonds
17% Gold
11% US Cash

Not too much gold not so little, same with cash, and with some REITs because I like them.
Hi,

Maybe it is interesting for a Variable Portfolio.

Another country, another COIN.

Do you have the track record link?

Thank you!
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by escafandro » Thu May 04, 2017 2:20 am

frugal wrote:
escafandro wrote:I do not know if it's better, but at least it's better for me.
Steal the percentages of MachineGhost who in turn steals the idea of Clive as he says.
viewtopic.php?f=1&t=7920&hilit=clive+40 ... 12#p135697

30% Global Stocks
10% Global REIT
32% US Bonds
17% Gold
11% US Cash

Not too much gold not so little, same with cash, and with some REITs because I like them.
Hi,

Maybe it is interesting for a Variable Portfolio.

Another country, another COIN.

Do you have the track record link?

Thank you!
From portfoliovisualizer.com 1994-2017
CAGR 7.43
StDev 7.40
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Re: Stocks, bonds, and gold have all returned 6.3% annualized over the last 10 years!

Post by mathjak107 » Fri May 12, 2017 2:40 am

i show for the most recent last 10 years with dividends reinvested as of may 1

the s&p 500 7.20%

nasdaq 10.40%

dow 7.40%

russell 2000 7.00%

small cap value 7.87%

the 10 years ending yesterday shows a total market fund up 7.21%.

as far as the pp goes :

gold up 5.77%

shy up 1.85%

TLT UP 6.69%

vti up 7.21%


that is 5.38% for the pp without rebalancing since rebalancing may or may not have made things worse depending on when done.

that compares to a total market funds 7.21% which really is not much different than the s&p 500 so if we included a mix of mid and small caps in proper allocation so they actually effect things the difference would be even greater as nasdaq and midcaps did better . .


so a diversified stock market investment holding more than the s&p 500 and including more stock segments did more than 6.30% over the most recent 10 years . likely 15-20% better with a mix of s&p 500, small cap value .

that is not bad considering that included some of the nastiest times for stocks and some of the best times for gold and bonds .

comparing things really amounts to picking the right time frame to highlight the segment you want .

starting 1 year later or earlier can make huge differences .

i mean if we go from 2000 to 2015 just treasury bonds did the best .

the problem is it means little to us over all .

because our balance grows over time hopefully , what happens in later time frames counts way more than in older time frames .

the greatest bull market in history , from 1987 to 2003 yielded almost 14% cagr returns for 17 years ..

but the time frame leading up to it sucked so not omly did we not have 401k's but most regular folks had very little invested when the good time came .

so the effect of the great returns on such little savings amounted to not much in comparison to the fact that today a mere 7% change represents 9 years of me maxing out my 401k at catch up in dollars .

so pulling out meaningless chunks of time and looking at charts really does not mean to much to us individually since it is all about the balance during that time frame picked and not the returns themselves .

the reverse is true when spending down . the worst group in history , those who retired in 1965/1966 also had the 17 year great bull market as part of it too. in fact the 30 year average return for them was quite respectable and normal once you included the great bull market .

their problem was that they spent so much down trying to keep pace the first 15 years of retirement that by the time the great bull came there was to little money left to save them even with those gains .

we were lucky in that a lot of our balance came from real estate sold from 2008 on so when we reinvested it in the markets it saw fabulous gains the last 9 years as markets tripled from the lows , even though at that point we were not 100% equities anymore . .

so don't be fooled by charts alone . it is the performance vs balance that matters to us most . what happens to us when our fuel tanks are full count the heaviest .
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by frugal » Fri May 12, 2017 3:07 pm

Your CapsLiock is broken :)

You keep only a PP?

Regards
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by mathjak107 » Fri May 12, 2017 3:30 pm

i have diabetic neropathy in my finger tips which is very painful so i can only type with one finger left handed . there is no way i can or will use a cap key .

no i am not currently a pp user . i use more conventional model portfolio's . at times i will use the golden butterfly if i feel it warranted but only on an as wanted basis .
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by Libertarian666 » Sun May 14, 2017 9:12 am

mathjak107 wrote:i have diabetic neropathy in my finger tips which is very painful so i can only type with one finger left handed . there is no way i can or will use a cap key .

no i am not currently a pp user . i use more conventional model portfolio's . at times i will use the golden butterfly if i feel it warranted but only on an as wanted basis .
Have you tried a dictation program? A number of years ago I was nearly crippled with carpal-tunnel syndrome and Naturally Speaking saved my ability to work.
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by mathjak107 » Sun May 14, 2017 12:38 pm

never felt the need to . except for use of the cap key , i got the fastest 1 finger around .
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by dualstow » Sun May 14, 2017 2:31 pm

mathjak107 wrote:never felt the need to . except for use of the cap key , i got the fastest 1 finger around .
You type a lot for someone down to one finger, not bad.
I hope you at least make use of shortcuts, i.e. text expansion.
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by mathjak107 » Mon May 15, 2017 4:28 am

i find i can type so fast now with the 1 finger . i really don't do anything different other than just not use caps .unless i have to .

it is funny how all my toes and with the one exceptional finger , everything else is so overly sensitive to touch .

it is just the tips that hurt . i weight lift and drum daily with no problem . but if anything hits the tips it feels like a bad sunburn being touched .

i run 5 miles every other day too with no problem . my sugar is at the higher end of normal and i am on no meds , just diet and exercise but i guess the nerves just do not get any better .
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by frugal » Sat May 20, 2017 12:48 am

hi

caps works with one finger

shift doesn't ...





GB and PP is almost the same


We need something really different from PP to make the difference.
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by mathjak107 » Sat May 20, 2017 2:41 am

i find it a pain in the butt to keep hitting the cap key on and off , if it bothers anyone that much there is always ignore or the typing forum .

GET OVER IT!
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by dualstow » Sat May 20, 2017 4:58 am

(off-topic post follows)

frugal, (Frugal? :-)) my guess is that m already has to hit control and function keys with the same finger -- no other choice, really -- so adding caps to that one-step, two-step probably becomes a real chore.

I can't believe I sat through typing class in the 80s only to be forced to hunt and peck on this ipad in the 2010s. I still remember how humiliating my one mistake was. It was on the test sentence, "The girl is sitting on the dock.". Notice how close the d and c are to each other.
I'm not making this up.

Let's just say, I crossed out the c with ink before the teacher got to it, and my guess us she changed the test after that. :blush:
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by Mr Vacuum » Sat May 20, 2017 8:37 am

Amen, dualstow. Text prediction and autocorrect make the glass screen bearable but only barely. Long live the keyboard.

It was always just there, but I learned to appreciate it after trying out the open source version of the software written for Stephen Hawking. The text prediction is excellent and overall interaction remarkable ​but still very limiting while sitting here with all my fingers ready to go. (Typing straight ahead is ok, but selection and cursor movement are brutal. Long live the mouse/touchpad, I should say.)

Mathjax must be the best one finger typist. Seeing paragraphs of thought flow down the page from that one finger is impressive.
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Re: Better Portfolio than Permanent Portfolio is ###### *******

Post by mathjak107 » Sat May 20, 2017 2:51 pm

my wife says i have the fastest 1 finger she ever knew lol
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