Heavy in PRPFX
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- Ad Orientem
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Re: Heavy in PRPFX
PRPFX does not index stocks and it is limited in terms of which sectors it can hold and in what proportion. But I would caution against checking daily movements in your PP. The HBPP does not go up every day either. There have been long (multi-week and in some case multi-quarter) periods where it stagnated or even lost ground. But it tends to go up over the long term as the various components shift gears. During 2008 there was a lag between the beginning of the stock market collapse and when LTTs started to shoot up.
The PP is best approached like the proverbial pot. Just leave it alone and it will boil. Spend your time watching it and you will just give yourself an ulcer and start questioning if it really works.
The PP is best approached like the proverbial pot. Just leave it alone and it will boil. Spend your time watching it and you will just give yourself an ulcer and start questioning if it really works.
Trumpism is not a philosophy or a movement. It's a cult.
Re: Heavy in PRPFX
And much of the rationale behind the PP is protection in severe economic/political circumstances, hence the directly held assets and out of country holdings. If this is important, you are not adding much (if any) security by moving from PRPFX to 4 ETFs, most all held by Schwab.
Re: Heavy in PRPFX
Ah, but I think the point here is that we are comparing the performance of PRPFX with that of its major components. Portart and others have pointed out that most of its price changes are driven by gold and stocks.
So let's check this on ETFreplay. PRPFX is 20% gold, 5% silver, 35% treasuries (avg maturity 6.6 yrs), 10% Swiss francs, 15% growth stocks, 15% natural resource and real estate stocks. When I plug these into ETFreplay using GLD, SLV, IEI, FXF, and VTI, here's what I get:
past 24 months: portfolio 11%, PRPFX 6.5%
past 12 months: portfolio 3.8%, PRPFX 2.1%
past 6 months: portfolio 1.7%, PRPFX 1.9%
past 3 months: portfolio 0.9%, PRPFX 0.7%
When I look back 36 months, the portfolio matches PRPFX very precisely up through mid 2011, after which the traces start to diverge:
This means the difference isn't explained by the expense ratio, and the divergence appears to be increasing over time. Hard to tell if this is the effect of stock picking vs recent underperformance of the natural resources sector, but either way it doesn't bode well for PRPFX. Having so much stocks concentrated in a couple of sectors is just as bad as the active management, IMHO. Not to say PRPFX isn't a perfectly good investment, just one that has its weak points.
So let's check this on ETFreplay. PRPFX is 20% gold, 5% silver, 35% treasuries (avg maturity 6.6 yrs), 10% Swiss francs, 15% growth stocks, 15% natural resource and real estate stocks. When I plug these into ETFreplay using GLD, SLV, IEI, FXF, and VTI, here's what I get:
past 24 months: portfolio 11%, PRPFX 6.5%
past 12 months: portfolio 3.8%, PRPFX 2.1%
past 6 months: portfolio 1.7%, PRPFX 1.9%
past 3 months: portfolio 0.9%, PRPFX 0.7%
When I look back 36 months, the portfolio matches PRPFX very precisely up through mid 2011, after which the traces start to diverge:
This means the difference isn't explained by the expense ratio, and the divergence appears to be increasing over time. Hard to tell if this is the effect of stock picking vs recent underperformance of the natural resources sector, but either way it doesn't bode well for PRPFX. Having so much stocks concentrated in a couple of sectors is just as bad as the active management, IMHO. Not to say PRPFX isn't a perfectly good investment, just one that has its weak points.
"Democracy is two wolves and a lamb voting on what to have for lunch." -- Benjamin Franklin
Re: Heavy in PRPFX
Yes, these charts tell you mathematically what I have noticed through price action. I have been watching it everyday for ten years, not just lately. I think something else is happening. I remember reading that the Swiss Frank could be the culprit tying itself to the Euro. Most likely it is the stocks owned in the fund that are underperforming and are just rotated out of favor. I am just an average investor so I am no expert for sure but I know for a fact that something has changed over time. When your paying .71 management fees, an additional divergence away from what you expect the fund to do, it gets your attention. The other thing is that PPRFX was the number one conservative fund out of all of them. Now they are near the bottom as the numbers even out by sheer odds. I think it is unrealistic for this fund to keep outperforming other conservative funds every year. I feel luck was on my side picking it at just the right time. I believe moving some money around using the same philosophy makes good sense.
Re: Heavy in PRPFX
Ah, the difference between expertise and wisdom... Of the two, I'd certainly favor the latter, and it sounds like you have it in spades. Congratulations on your success so far, and best wishes going forward. Thanks for sharing your story.portart wrote: I am just an average investor so I am no expert for sure...
Re: Heavy in PRPFX
Have you located that letter from HB? I'd love to read it.Reub wrote: Yes, please publish the paper that Harry Browne wrote for you. I would love to see it!
Re: Heavy in PRPFX
I have his papers somewhere as I saw them not too long ago.. I looked the other day but didn't locate them yet. When I find them, I will do a full report. At the time I got them, I didn't realize he would become famous posthumously as this.
Re: Heavy in PRPFX
PRPFX down from 99 percent to 68 percent of my portfolio as I continue to redistribute using other funds for the same breakdown. I own more gold through since PRPFX has 5% silver as part of it's 25% PM. Picked up some GDX which is so sold off that the risk reward here may be the best buy in the last twenty years, when gold goes over $2,000 which could be breathtakingly fast. GDX is priced for $800 gold so which do you believe?
Re: Heavy in PRPFX
Hi people, I haven't written to this post in awhile. For whatever reason, I am back to 100 percent in PRPFX. It has gone nowhere for a long time. I am getting a little nervous about if and when the stimulus stops, this portfolio might find it's way back to $45.00 a share. I don't know what other diversity I would go to now with stocks so high, increasing exposure there could be expensive in a set back which could come at any time. Anyone have ideas on this?
- Ad Orientem
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Re: Heavy in PRPFX
If you are looking for radical diversification in 1 stop shopping you would be hard pressed to find a better choice than PRPFX. My only complaint is its E/R which will detract from your long term returns. The future is unpredictable but the fund has withstood all of the economic storms of the last 30+ years. I would try to avoid worrying about future events. That's kind of the point in owning such a fund.portart wrote: Hi people, I haven't written to this post in awhile. For whatever reason, I am back to 100 percent in PRPFX. It has gone nowhere for a long time. I am getting a little nervous about if and when the stimulus stops, this portfolio might find it's way back to $45.00 a share. I don't know what other diversity I would go to now with stocks so high, increasing exposure there could be expensive in a set back which could come at any time. Anyone have ideas on this?
Trumpism is not a philosophy or a movement. It's a cult.
Re: Heavy in PRPFX
What makes you think stimulus is going to stop?portart wrote: Hi people, I haven't written to this post in awhile. For whatever reason, I am back to 100 percent in PRPFX. It has gone nowhere for a long time. I am getting a little nervous about if and when the stimulus stops, this portfolio might find it's way back to $45.00 a share. I don't know what other diversity I would go to now with stocks so high, increasing exposure there could be expensive in a set back which could come at any time. Anyone have ideas on this?
The FED is trying to have their cake and eat it too. The stimulus is neccessary to keep the banks and government afloat but if they let the cat out of the bag that they have no intention of withdrawing (I think they're more likely to up it) then they will plunge the dollar.
If they actually do stop printing by some miracle, PRPFX will probably get hurt but I imagine the dollar will really firm up so you might not lose too much purchasing power.
I wouldn't bet on a strong dollar as long as this regime is in power though. They have made a lot of promises to people that can only be kept if they print the money to pay for it.