Bitcoin in the PP?

[Medolark Lemon]

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?

[shekels]

CLICKBAIT ?

[l82start]

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...

[Kriegsspiel]

Where's bitcoininthevp, he would know!

[Medolark Lemon]

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?

[Kriegsspiel]

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.

[l82start]

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..

[Smith1776]

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.)

[Xan]

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.

[Smith1776]

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.

[Kriegsspiel]

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.

[l82start]

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

[Smith1776]

How long is the vetting process?

I say at least 100 legit looking posts and at least 50 of them have to be praise for Craig/Tex/PP.

[europeanwizard]

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?

Well, I for one think it's a very good idea. The PP provides for this, in some sense. Besides the Permanent Portfolio, it's advised to keep a VP = Variable Portfolio, if you would like to take up other investments.

So if I consider my PP 100%, then my additional VP consists of 2% peer-to-peer lending and 2% Bitcoin.

[pmward]

1% allocation is not enough to lose sleep over. Now, it's highly likely that it's not going to continue going up at the rate it has historically, so 1% also might not be enough to move the needle up either. But, I see no reason why someone can't allocate 1% of their portfolio to a moon shot.

[Medolark Lemon]

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..

thanks for the response, I can definitely understand the viewpoints

[Medolark Lemon]

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?

Well, I for one think it's a very good idea. The PP provides for this, in some sense. Besides the Permanent Portfolio, it's advised to keep a VP = Variable Portfolio, if you would like to take up other investments.

So if I consider my PP 100%, then my additional VP consists of 2% peer-to-peer lending and 2% Bitcoin.

Ahh i see, yeah that makes sense. I have seen a couple other people mention a "VP" and didnt know what it meant. I like that idea, have my PP to keep honest and stay away from market timing and then a VP as well as I naturally have always been interested in alternative investments as well (even if it may be sort of a moon shot)

[dualstow]

If ML is a bot, so am I.

So you finally admit it.

pugtron

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EDIT: resized image

[Libertarian666]

I'd rather add Beanie Babies to the PP.

[l82start]

I'd rather add Beanie Babies to the PP.

i actually know somebody with an extensive beanie baby collection that they inherited from their wife, and who has no idea what to do with it, how much markup can i get for brokering the deal.

[Libertarian666]

I'd rather add Beanie Babies to the PP.

i actually know somebody with an extensive beanie baby collection that they inherited from their wife, and who has no idea what to do with it, how much markup can i get for brokering the deal.

Got me. That was just a figure of speech.

[yankees60]

I'd rather add Beanie Babies to the PP.

i actually know somebody with an extensive beanie baby collection that they inherited from their wife, and who has no idea what to do with it, how much markup can i get for brokering the deal.

I'd head to eBay to see what they are worth...

Vinny

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[bitcoininthevp]

Did someone flash the Bitcoin signal in the sky?!

I proposed a version of the PP with 24/24/24/24/4 allocation (with 4% being in Bitcoin). But it is really more for fun and also the same as a normal PP with a Bitcoin sidecar in the VP. Im a huge long term Bitcoin bull, but the only way it makes any sense in the PP context is putting the Bitcoin in the variable portfolio.

viewtopic.php?f=1&t=9347&p=167356&hilit=name#p167356

Even if you think of Bitcoin as the worlds "third favorite money" (which it isnt yet) and it eating out of some of golds value proposition, it is still a speculation.

To be completely clear Im talking specifically about Bitcoin here. Stablecoins (USD equivalents), utility tokens (like ETH), and less sound
cryptocurrency attempts at "money" (like LTC) are not valuable long term IMHO.

[bitcoininthevp]

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?

Well, I for one think it's a very good idea. The PP provides for this, in some sense. Besides the Permanent Portfolio, it's advised to keep a VP = Variable Portfolio, if you would like to take up other investments.

So if I consider my PP 100%, then my additional VP consists of 2% peer-to-peer lending and 2% Bitcoin.

In the radio shows or elsewhere Harry mentioned that if you are going to speculate in the VP it is best to be outsized bets with high potential returns.

via An (Institutional) Investor’s Take on Cryptoassets
https://s3.eu-west-2.amazonaws.com/john ... ets+v6.pdf

Regarding risk, an investment with a 20x – 60x upside only requires a probability of
success of between 2% to 5% to be a positive net expected value investment. Each of us can
reflect on his own view of what that the probability is of the foregoing scenario materialising.
I’m personally pretty comfortable that, given where we are today in Bitcoin’s development
and adoption, that the probability is higher than 2 – 5%, likely much higher. While there are
many technical, political, regulatory and psychological hurdles ahead, the store-of-value use
case is by far the simplest one, and already closest to reality. I would argue therefore that
here you have an investment with a downside:upside skew of -1x : 60x and a positive net
expected value. Investments with both those characteristics are extremely rare.

He is specifically talking about Bitcoin replacing a certain % of gold here. Recommended reading the full PDF if you are curious.

[bitcoininthevp]

I'd rather add Beanie Babies to the PP.

Still waiting for an intellectual criticism from you.

Every thread on Bitcoin you spin the wheel-of-bitcoin-attempted-insults-from-2013 and pull out tulips or beanie babies or some nonsense without adding any value to the thread.

Reminds me of close-minded Boglers trying to insult gold as a useless shiny rock without ever trying to understand it.

And I would add you are also devaluing any of the contributions you make elsewhere on the forum doing this.