Bitcoin in the PP?

General Discussion on the Permanent Portfolio Strategy

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Medolark Lemon
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Bitcoin in the PP?

Post by Medolark Lemon » Wed Mar 25, 2020 4:28 pm

Hello guys, this is my first post and am a new member of this forum.

I have recently come across the PP strategy (via the Serpent and the hawk allegory from Christopher Cole) and quickly appreciated it due to the lack of timing the market and the rebalancing/diversification involved. I have no idea why the PP isn't talked about more within the investing community as it is such a robust portfolio but maybe it's just my echo chamber that doesnt talk about it.

Glad I have found this forum as I have learned a lot quickly.

One thing that I am curious about is the opinion of others in terms of including an allocation to bitcoin (albeit very small allocation). I have seemed to always understand the value proposition of Gold which may be why I tend to "get" bitcoin proponents. The monetary policy of bitcoin cannot be changed and includes a finite supply. The returns of bitcoin have obviously been astounding over the last 10 years, maybe its just the volatility or that the system has only been around for 10 years that scares people away....

https://bitcoinist.com/sp-500-bitcoin-portfolio-gold/

The link shows a 99% cash allocation and 1% bitcoin allocation has outperformed stocks, bonds, and gold on a risk/reward basis. Is this cause to include a 0.5%-1.0% allocation to bitcoin? It seems incredibly expensive not to at least have a very miniscule exposure to the asset. What am I missing?
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shekels
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Re: Bitcoin in the PP?

Post by shekels » Wed Mar 25, 2020 6:24 pm

CLICKBAIT ?
¯\_(ツ)_/¯
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l82start
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Re: Bitcoin in the PP?

Post by l82start » Wed Mar 25, 2020 6:30 pm

or real person sucked in by clickbait asking an honest question? i am going to give benefit of the doubt for a moment. if the account doesn't engage in an actual conversation in a reasonable amount of time i will take care of it...
“The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by an endless series of hobgoblins, most of them imaginary.”

Belief is the death of intelligence. As soon as one believes a doctrine of any sort, or assumes certitude, one stops thinking about that aspect of existence
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Kriegsspiel
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Re: Bitcoin in the PP?

Post by Kriegsspiel » Wed Mar 25, 2020 6:35 pm

Where's bitcoininthevp, he would know!
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I hated all the things I had toiled for under the sun, because I must leave them to the one who comes after me. Who knows whether that person will be wise or foolish? Yet they will have control over all the fruit of my toil into which I have poured my effort and skill under the sun. . . Nothing is better for a man than to eat and drink and enjoy his work.
- Ecclesiastes
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Medolark Lemon
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Re: Bitcoin in the PP?

Post by Medolark Lemon » Wed Mar 25, 2020 6:57 pm

l82start wrote:
Wed Mar 25, 2020 6:30 pm
or real person sucked in by clickbait asking an honest question? i am going to give benefit of the doubt for a moment. if the account doesn't engage in an actual conversation in a reasonable amount of time i will take care of it...
Real person asking a genuine question lol... I havent really read up on the forum rules so not sure if you aren't allowed to post links.

I am honestly curious what the thought process of the risk/reward ratio is of putting 0.5%-1.0% bitcoin in one's portfolio?
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Kriegsspiel
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Re: Bitcoin in the PP?

Post by Kriegsspiel » Wed Mar 25, 2020 7:02 pm

Well, it depends. Back before this crash, 0.5% of my portfolio was a bit much. But now? Fuck it, let's roll some dice.
I hated all the things I had toiled for under the sun, because I must leave them to the one who comes after me. Who knows whether that person will be wise or foolish? Yet they will have control over all the fruit of my toil into which I have poured my effort and skill under the sun. . . Nothing is better for a man than to eat and drink and enjoy his work.
- Ecclesiastes
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l82start
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Re: Bitcoin in the PP?

Post by l82start » Wed Mar 25, 2020 7:23 pm

Medolark Lemon wrote:
Wed Mar 25, 2020 6:57 pm
l82start wrote:
Wed Mar 25, 2020 6:30 pm
or real person sucked in by clickbait asking an honest question? i am going to give benefit of the doubt for a moment. if the account doesn't engage in an actual conversation in a reasonable amount of time i will take care of it...
Real person asking a genuine question lol... I havent really read up on the forum rules so not sure if you aren't allowed to post links.

I am honestly curious what the thought process of the risk/reward ratio is of putting 0.5%-1.0% bitcoin in one's portfolio?
welcome to the forum... no rules against posting links, 98% of the time links on a first post are spam bots, sorry for the suspicion..
my best guess on response to bitcoin in a pp will be "bitcoin in the VP sure go for it" - "it has potential but its to young/new for pp at this point" "RUN AWAY RUN AWAY" " and "love the cripto anarchist non government money side but as an investment not so much" i personally would say 1,2,and 4..
“The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by an endless series of hobgoblins, most of them imaginary.”

Belief is the death of intelligence. As soon as one believes a doctrine of any sort, or assumes certitude, one stops thinking about that aspect of existence
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Smith1776
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Re: Bitcoin in the PP?

Post by Smith1776 » Wed Mar 25, 2020 7:25 pm

I'm one of the odd ducks that thinks that cryptocurrency will eventually make its way into a canonical iteration of the PP.

The gold portion of the portfolio is an alt-cash. Browne chose it because it's the "second most popular form of money."

It's disaster protection. It's a get-out-of-dodge asset. And I think a mature cryptocurrency could find itself as being part of the gold portion of the portfolio in the future.

(Yeah, yeah, Smith you're totally off-base. I know, I know.)
“My natural state is an outsider, and no matter what group I'm in or where I am, I've always felt like I'm outside the group, and I've always been analyzing the group.” - Michael Burry
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Xan
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Re: Bitcoin in the PP?

Post by Xan » Wed Mar 25, 2020 8:37 pm

Welcome, Medolark Lemon!

Sorry for the less than warm initial response. Your post had two elements which are very commonly associated with spambots:
* Interest in Bitcoin
* Including a link

Believe it or not, such bots have gotten very good at scraping text from forums like this one and assembling what appears to be a coherent, vaguely on-topic post. We've been fooled here before.

My personal experience is that if there's any doubt about a poster being a spammer, it always turns out that he is. You are the first counterexample I can recall.
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Smith1776
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Re: Bitcoin in the PP?

Post by Smith1776 » Wed Mar 25, 2020 8:39 pm

Xan, I might still be a bot.

You never know. It's a long con. It's like Ocean's Eleven for the digital age.
“My natural state is an outsider, and no matter what group I'm in or where I am, I've always felt like I'm outside the group, and I've always been analyzing the group.” - Michael Burry
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Kriegsspiel
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Re: Bitcoin in the PP?

Post by Kriegsspiel » Wed Mar 25, 2020 8:42 pm

Xan wrote:
Wed Mar 25, 2020 8:37 pm
Welcome, Medolark Lemon!

Sorry for the less than warm initial response. Your post had two elements which are very commonly associated with spambots:
* Interest in Bitcoin
* Including a link

Believe it or not, such bots have gotten very good at scraping text from forums like this one and assembling what appears to be a coherent, vaguely on-topic post. We've been fooled here before.

My personal experience is that if there's any doubt about a poster being a spammer, it always turns out that he is. You are the first counterexample I can recall.
I say it's still under consideration.
I hated all the things I had toiled for under the sun, because I must leave them to the one who comes after me. Who knows whether that person will be wise or foolish? Yet they will have control over all the fruit of my toil into which I have poured my effort and skill under the sun. . . Nothing is better for a man than to eat and drink and enjoy his work.
- Ecclesiastes
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l82start
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Re: Bitcoin in the PP?

Post by l82start » Wed Mar 25, 2020 8:49 pm

Kriegsspiel wrote:
Wed Mar 25, 2020 8:42 pm
Xan wrote:
Wed Mar 25, 2020 8:37 pm
Welcome, Medolark Lemon!

Sorry for the less than warm initial response. Your post had two elements which are very commonly associated with spambots:
* Interest in Bitcoin
* Including a link

Believe it or not, such bots have gotten very good at scraping text from forums like this one and assembling what appears to be a coherent, vaguely on-topic post. We've been fooled here before.

My personal experience is that if there's any doubt about a poster being a spammer, it always turns out that he is. You are the first counterexample I can recall.
I say it's still under consideration.
ditto and ditto O0
“The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by an endless series of hobgoblins, most of them imaginary.”

Belief is the death of intelligence. As soon as one believes a doctrine of any sort, or assumes certitude, one stops thinking about that aspect of existence
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