No where to hide

[LC475]

Heaven forbid a portfolio might lose an entire percentage point.

I mean, not just part of a percent, not just a fraction: a full, complete percentage point!

That's just outrageous.  I want my money back.

Or maybe just some babyback ribs.  Can't I at least get that?  Just some simple ribs, man!

[buddtholomew]

Laugh all you want...My 65/35/5 is up 2.2% YTD even after yesterdays decline and has been handily thrashing the PP for over 7 years now. I never joke about money and for those solely invested in the permanent portfolio I hope you achieve your retirement with these pathetic gains (or should I say losses).

I will no longer post on this board about the PP performance for your amusement. The money you cant afford to lose, my a$$

[dragoncar]

Laugh all you want...My 65/35/5 is up 2.2% YTD even after yesterdays decline and has been handily thrashing the PP for over 7 years now. I never joke about money and for those solely invested in the permanent portfolio I hope you achieve your retirement with these pathetic gains (or should I say losses).

I will no longer post on this board about the PP performance for your amusement. The money you cant afford to lose, my a$$

At least I haven't heard that catchphrase in a while, and the pro-PP rhetoric (hyperbole) has been toned down.  Please continue to post for our amusement.  I'm still waiting for that hug.

[screwtape]

Laugh all you want...My 65/35/5 is up 2.2% YTD even after yesterdays decline and has been handily thrashing the PP for over 7 years now. I never joke about money and for those solely invested in the permanent portfolio I hope you achieve your retirement with these pathetic gains (or should I say losses).

I will no longer post on this board about the PP performance for your amusement. The money you cant afford to lose, my a$$

Not too familiar with the situation but from what I gather from the posts I've read is that you made the classic mistake of jumping in and out, buying high and selling low. Truly sorry if you became the laughingstock for that type of behavior. A lot of us have probably been there and done that if we care to admit it. When you say that your 65/35/5 is up over a 7 year period does that factor in your time getting in and out of the PP or is that what it would have been if you had stuck with your plan before trying to adopt the PP?

[Pointedstick]

You know, the "can't afford to lose" part means "won't disappear" and not "will never ever ever decline in value." If there was a portfolio that had real gains with no nominal losses ever, everyone would be using it!

[buddtholomew]

Laugh all you want...My 65/35/5 is up 2.2% YTD even after yesterdays decline and has been handily thrashing the PP for over 7 years now. I never joke about money and for those solely invested in the permanent portfolio I hope you achieve your retirement with these pathetic gains (or should I say losses).

I will no longer post on this board about the PP performance for your amusement. The money you cant afford to lose, my a$$

Not too familiar with the situation but from what I gather from the posts I've read is that you made the classic mistake of jumping in and out, buying high and selling low. Truly sorry if you became the laughingstock for that type of behavior. A lot of us have probably been there and done that if we care to admit it. When you say that your 65/35/5 is up over a 7 year period does that factor in your time getting in and out of the PP or is that what it would have been if you had stuck with your plan before trying to adopt the PP?

My CAGR is 4.10% since adopting the PP in mid-2011. I currently have an 18% paper loss in GLD. I am not selling anything, but refuse to comment on PP performance any further since everyone can readily accept poor performance but me. It's not the 1% YTD loss, but rather what I have assumed all along - the PP performs as gold performs period. All other assets resemble a conventional buy and hold BH portfolio.

[l82start]

so... this is probably a real stupid question from somebody who should have figured this out long ago but..

for those who follow theirs religiously (i am not even set up to track it) i am curious what YTD tells you that is valuable /important information? given how much it comes up i suspect i am seriously missing something, but i cant quite see what.. i follow the IRR for my portfolio (up around 3.8 or so right now for my investing history) most of which is PP returns except the first year or so, this is the measure i use for how i am doing as an investor...

  YTD would tell me how a portfolio with the same numbers as mine has at the beginning does between two randomly chosen days (JAN 1 and DEC 30?). (or jan 1 and today) not including the effect of the contributions and withdraws i make. giving me a notion of how the PP assets are doing on a short and randomly chosen time horizon..  for the purpose of ??  or to restate the question "why do i want to know this?"

[EdwardjK]

2015 has been a dismal year for the HBPP.  I cannot help but notice that the first two weeks of the year produced a small gain, followed by a steady decline YTD thereafter.

My Fidelity rep. is encouraging me to get out of TLT (LT Treasuries), as they have been getting whacked. 

So I need words of encouragement here, folks.  What to do?

[buddtholomew]

2015 has been a dismal year for the HBPP.  I cannot help but notice that the first two weeks of the year produced a small gain, followed by a steady decline YTD thereafter.

My Fidelity rep. is encouraging me to get out of TLT (LT Treasuries), as they have been getting whacked. 

So I need words of encouragement here, folks.  What to do?

Here's the general advice...don't look at the individual components in isolation but the entire portfolio as a whole. The YTD loss is minimal in the long-term and one or more of the other assets will rise to compensate for the decline in another. Hope that makes you feel more confident than I do.

[screwtape]

2015 has been a dismal year for the HBPP.  I cannot help but notice that the first two weeks of the year produced a small gain, followed by a steady decline YTD thereafter.

My Fidelity rep. is encouraging me to get out of TLT (LT Treasuries), as they have been getting whacked. 

So I need words of encouragement here, folks.  What to do?

My advice would be that if you don't think the PP is working for you the way it's supposed to then get out of it and find something else that can give you the peace of mind you are looking for. And let the rest of us know how it works out when you do. I think most everybody here is open-minded and I'm sure they'll be glad to listen.

[Mark Leavy]

I will no longer post on this board about the PP performance for your amusement. The money you cant afford to lose, my a$$

Budd - please continue posting your concerns.  I don't think anything is set in stone.

I do go back to my point that you need a different metric - as daily fluctuations will drive any person insane.  There are some fantastic charts on the Sticky that MT posted.  If only there were some way to make them live (or even better yet, reflect your personal, individual profile).

Checking that suite of charts (updated daily with your own data) would be a much better way to look at your cash every morning with your coffee and chocolate baguette.

The sea of red and red and green that comes up on the daily ticker is junk food.

So... again, I don't think you are wrong at all to keep criticizing and examining and questioning - and I much appreciate reading what you write as it prompts me to do my own checking.

If anything, I would recommend that you use a better metric.  Maybe Tyler or Pugchief can sell a service where they provide daily charts with your personal portfolio information.  I know I would buy it.

Best...
Mark

[D1984]

Laugh all you want...My 65/35/5 is up 2.2% YTD even after yesterdays decline and has been handily thrashing the PP for over 7 years now. I never joke about money and for those solely invested in the permanent portfolio I hope you achieve your retirement with these pathetic gains (or should I say losses).

I will no longer post on this board about the PP performance for your amusement. The money you cant afford to lose, my a$$

Budd,

IIRC (please feel free to correct me if I'm wrong) you started investing in the 60/40 around the end of October of 2008, right? Using VBINX as a reasonable proxy for a 60/40, at that point it had already declined (from its highs of October 2007) by around 25% or 26%. From the end of October 2008 levels it only declined a little less than 14% further to the March 9th 2009 bottom. In other words, of course the 60/40 seems like a no-brainer to you vs the PP--you missed most of the huge stomach-churning drop! Had you invested in the 60/40 in October 2007 or January 2008, how would you be feeling in late 2008 or early 2009 as you saw your portfolio lose more than 33% of its value? Be honest with us (and with yourself).....would you have been less worried about that 30%+ drop than you were about the PP's 1% or 2% drop so far this year? Had you been instead invested in the PP during that time frame (late 2007 to March 2009), you would have had a slight gain for said time period vs a 30% (or more) loss in the 60/40 and would likely have been singing the PP's praises.

Any portfolio is going to have its time in the sun; any portfolio will also have its time in the shitter. NO mixed-asset portfolio will keep up with being 100% market (or a 60/40 stock/bond...which has a significant majority of its upside and downside capture contributed by the stock portion and not the bond portion since stocks are so much more volatile than bonds) when the market is booming while at the same time preserving you against a huge majority of the downside when the market takes a dive. It seems to me that is what you want (all or most of the market upside with none of the market risk) but no traditional passive "invest, hold, and rebalance" portfolio is going to provide most of the "pleasure" of upside while avoiding the "pain" of downside. Without either:

A. Investing in structured/indexed products or a homemade variant thereof,

B. Investing in a "leveraged/risky+safe" barbell

C. Being willing to use market timing and never get emotional and second guess what the mechanical system tells you to do

Then what you seek is well nigh impossible...even all of the above strategies have their own disadvantages to go with whatever advantage they provide in terms of risk vs reward.

The only other option is "staying all in cash" but again, that has the disadvantage of missing the upside in order to avoid any downside. There is no way that I know of that lets an investor avoid losing money when the market is down that lets him/her participate in all the upside with no tracking error when it is up. Sorry...like PS said, it just doesn't exist.

[screwtape]

2015 has been a dismal year for the HBPP.

Define "dismal".

On second thought, don't. I only check once a year in February. I'll decide then.

[craigr]

Returns since 2011 PP vs. S&P 500:

PP 2011 +11.4%
SPY +1.9%

PP 2012 +6.8%
SPY: +16%

PP 2013  -2.4%
SPY: +32.3%

PP 2014 +9.1%
SPY: +13.5%

PP 2015: -1.1%
SPY: +1.1%

One down year. One great year vs. S&P. One decent year vs. S&P. One mediocre. 2015 is up for grabs.

Keep in mind that in 2013 the portfolio was slightly negative, but this was with a HUGE drop in the gold price. That kind of drop would have pummelled a typical stock portfolio if it happened to that asset.

100% stocks did better. No surprise. Stocks are at an all-time high. 

Volatility wise though there is no comparison that the PP is a much smoother ride.

Investors should decide what they want: Attempt for sky high returns, or try to get lower returns with capital preservation features.

I've known many people that tried for sky high returns by investing heavily in stocks. I think most of them regretted the decision eventually. But everyone needs to decide what is best for their own personality and circumstances.

[iwealth]

My CAGR is 4.10% since adopting the PP in mid-2011.

The money you cant afford to lose, my a$$

Can't report a positive real CAGR since your 2011 PP implementation and then imply you've lost money at the same time. It's disingenuous.

[MachineGhost]

You know, the "can't afford to lose" part means "won't disappear" and not "will never ever ever decline in value." If there was a portfolio that had real gains with no nominal losses ever, everyone would be using it!

About 50% of people -- especially Millennials -- do.  It's called C-A-S-H. 

[MachineGhost]

Laugh all you want...My 65/35/5 is up 2.2% YTD even after yesterdays decline and has been handily thrashing the PP for over 7 years now. I never joke about money and for those solely invested in the permanent portfolio I hope you achieve your retirement with these pathetic gains (or should I say losses).

I will no longer post on this board about the PP performance for your amusement. The money you cant afford to lose, my a$$

Not too familiar with the situation but from what I gather from the posts I've read is that you made the classic mistake of jumping in and out, buying high and selling low. Truly sorry if you became the laughingstock for that type of behavior. A lot of us have probably been there and done that if we care to admit it. When you say that your 65/35/5 is up over a 7 year period does that factor in your time getting in and out of the PP or is that what it would have been if you had stuck with your plan before trying to adopt the PP?

My CAGR is 4.10% since adopting the PP in mid-2011. I currently have an 18% paper loss in GLD. I am not selling anything, but refuse to comment on PP performance any further since everyone can readily accept poor performance but me. It's not the 1% YTD loss, but rather what I have assumed all along - the PP performs as gold performs period. All other assets resemble a conventional buy and hold BH portfolio.

I don't think that's a fair characterization.  The PP performs as stocks perform; when they don't, bonds or gold picks up the slack.  You can't tell whether it'll be bonds or gold ahead of time.  And sometimes its neither, which is why the cash is there.  A Boglehead portfolio lacks long-term T-Bonds, gold and cash for protection.  It doing good is purely an artifact of a 30-year double stock and bond bull market.  When it finally ends, it'll make the PP look like awesome in comparison.

But harping on what D1984 said, it does sound like you've been suffering from the anchoring bias of post-2009.  All winners and no losers makes Jack a cocky boy.

[Pet Hog]

You know, the "can't afford to lose" part means "won't disappear" and not "will never ever ever decline in value." If there was a portfolio that had real gains with no nominal losses ever, everyone would be using it!

About 50% of people -- especially Millennials -- do.  It's called C-A-S-H. 

I Bonds?

[buddtholomew]

My CAGR is 4.10% since adopting the PP in mid-2011.

The money you cant afford to lose, my a$$

Can't report a positive real CAGR since your 2011 PP implementation and then imply you've lost money at the same time. It's disingenuous.

Its time dependent. Recall the negative REAL 3 year return periods.

[Pointedstick]

You know, the "can't afford to lose" part means "won't disappear" and not "will never ever ever decline in value." If there was a portfolio that had real gains with no nominal losses ever, everyone would be using it!

About 50% of people -- especially Millennials -- do.  It's called C-A-S-H. 

Before 2009, maybe! The real return on my cash has been negative for several years. Even I-bonds are barely breaking even.

But seriously, get a better hobby. Checking on your portfolio every day will drive you mad no matter what it is. Every portfolio except for 100% cash will experience nominal declines, and if those declines upset you, you're causing yourself stress for no reason. If the reason why you feel the need to check all the time is because you don't have confidence in the portfolio, then get one you do have confidence in.

[iwealth]

My CAGR is 4.10% since adopting the PP in mid-2011.

The money you cant afford to lose, my a$$

Can't report a positive real CAGR since your 2011 PP implementation and then imply you've lost money at the same time. It's disingenuous.

Its time dependent. Recall the negative REAL 3 year return periods.

I don't recall the PP having any 3-year rolling periods since 2011 with a negative real CAGR, but maybe you experienced some loss in 2011 and then throughout early 2014?

But either way, it's almost a shame you didn't experience crushing losses in 2000-2002 or the true depths of the 2008 recession. I bet you'd be looking at these "losses" differently. Your negative experience with the PP is entirely time dependent and nobody can look at you in the eye and tell you that your PP implementation timing wasn't lousy. But if you have a negative expectation of the portfolio going forward, why oh why wouldn't you sell and move on to something with a positive expectation?

You feel terrible seemingly every day about something you can fix with a few clicks of the mouse. In another post we talked about the paralysis over fear of the assets rebounding as soon as you sell, but there's probably no worse reason to stay in a portfolio than that. It's as if you have no faith in the PP to preserve your money but at the same time don't truly trust your money anywhere else.

[Mark Leavy]

It's as if you have no faith in the PP to preserve your money but at the same time don't truly trust your money anywhere else.

That's just delightfully concise - and a very good template to explain a lot of human stasis.

[dragoncar]

You know, the "can't afford to lose" part means "won't disappear" and not "will never ever ever decline in value." If there was a portfolio that had real gains with no nominal losses ever, everyone would be using it!

It's for the money that you can't afford to lose more than 20%.

It's for a portion of the money you can't afford to lose, and a portion which you can.

[mathjak107]

Can't report a positive real CAGR since your 2011 PP implementation and then imply you've lost money at the same time. It's disingenuous.

Its time dependent. Recall the negative REAL 3 year return periods.

I don't recall the PP having any 3-year rolling periods since 2011 with a negative real CAGR, but maybe you experienced some loss in 2011 and then throughout early 2014?

But either way, it's almost a shame you didn't experience crushing losses in 2000-2002 or the true depths of the 2008 recession. I bet you'd be looking at these "losses" differently. Your negative experience with the PP is entirely time dependent and nobody can look at you in the eye and tell you that your PP implementation timing wasn't lousy. But if you have a negative expectation of the portfolio going forward, why oh why wouldn't you sell and move on to something with a positive expectation?

You feel terrible seemingly every day about something you can fix with a few clicks of the mouse. In another post we talked about the paralysis over fear of the assets rebounding as soon as you sell, but there's probably no worse reason to stay in a portfolio than that. It's as if you have no faith in the PP to preserve your money but at the same time don't truly trust your money anywhere else.

i was fully invested in 2008 in my fidelity insight  growth model and while down about 31 % or so as long as you stuck to the plan it eventually was as always a non event  .  i was also invested in it back in 1987 and the model saw 100k grow to 2.4 million with no other money added.  even the s&p 500  grew to about 500k less.

it really does not matter which road you take  as long as there is a plan involved.

for accumulating money the pp isn't the best way , especially going forward  .

the back tested time frames for the PP  were basically all in a 40 year falling interest rate environment  with just some hic cups along the way.

well with no where to go now except up if we do not have a flight to safety that can be some tough head winds for the pp.

[lordmetroid]

Yields can go anywhere, even negative. Just saying!
Yes, there would even be people buying treasuries with negative yield if other assets was showing catastrophic returns.