Can I buy the four components that make up the permanent portfolio individually?

[tnt211]

Hello-

Would this etf be a good one to contribute to as it seems to be in line with the permanent portfolio strategy?

http://www.thestreet.com/quote/PERM.html

Also, what if I just skipped an all in one etf or fund all together and just started purchasing each of the four components, individually, and rebalanced manually once or twice a year?

Are there etf's set up for each of these four components?  (i.e. equities, gold, long-dated bonds and cash).  Do you know what they are, if so? 

thanks for the help!

[Pointedstick]

Check the stickied posts.

http://gyroscopicinvesting.com/forum/pe ... d-options/

PERM is not recommended. It substantially underperforms a DIY 4x45 portfolio due to issues with its composition.

[Ad Orientem]

Hi TNT and welcome to the forum!

+1 to Pointed's comment (I think he meant 4x25%). We generally don't recommend any of the one stop PP mutual funds because of cost and various biases built into them. The usual method advocated here is to go with four separate asset classes consisting of stocks, US Gov't long bonds, gold and cash or a near equivalent.

The stocks should be indexed either to the total US stock mkt or the S&P 500. Although some are comfortable with VT which is a global stock market index. Long bonds can be held directly (ideally) or a very long term US Treasury ETF like TLT. Be aware that while ETFs are generally pretty safe there is a layer of risk there that is not usually associated with directly owning the bonds. Nonetheless many (including me) use the ETF for convenience sake. Gold should be held physically to the extent possible and or practical since this is your SHTF scenario insurance. However if you choose to go with an ETF, IAU is the one usually recommended. Cash is cash. Most of us use a short term government bond ETF, some prefer a Treasury backed Money Market Fund while others do actual T Bills or hold their cash in an actual insured bank account. The big rule here is you want it to be as safe as possible and if you are using short term bonds, they really do need to be SHORT TERM. Don't go chasing yield.

[Pointedstick]

Yeah, oops. 4x25. It's hard to go wrong with something simple like VTI, TLT, IAU, and SHY, or SCHB, TLO, SGOL, and SCHO (commission-free Schwab version). Once you become more comfortable with things, you can start to replace some gold ETF with physical gold and bond ETF with real bonds, etc. But you'll still be light years ahead of most portfolios even holding only ETFs or funds.

[babysquirrel]

4 x 45 would be awesome!

[barrett]

4 x 45 would be awesome!

I feel 80% wealthier already!