Always on sale!

[joypog]

I just realized that there is a rarely mentioned behavioral benefit to the Risk Parity approach – even during accumulation.

"being diversified means you’re always losing" = something is ALWAYS on sale!

I grok the William Bernstein sentiment “get on your hands and knees and pray for a market crash”, but it’s always rubbed me wrong. Even though it may be true for a young professional who avoids layoffs, a bad economy exacts a tremendous toll on individuals and families.

With an RP style portfolio, there is always a good deal in the market, no matter what the economy is doing.

Even in an everything-hot economy (bizarro-2022) an RP portfolio will always have something cheap to buy - Cash!

[yankees60]

I just realized that there is a rarely mentioned behavioral benefit to the Risk Parity approach – even during accumulation.

"being diversified means you’re always losing" = something is ALWAYS on sale!

I grok the William Bernstein sentiment “get on your hands and knees and pray for a market crash”, but it’s always rubbed me wrong. Even though it may be true for a young professional who avoids layoffs, a bad economy exacts a tremendous toll on individuals and families.

With an RP style portfolio, there is always a good deal in the market, no matter what the economy is doing.

Even in an everything-hot economy (bizarro-2022) an RP portfolio will always have something cheap to buy - Cash!

What IS the correlation between the two? Aren't sometimes the market and the economy disconnected from one another?

[joypog]

sometimes...but they are often related too.