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Why I Love the PP
Posted: Fri Jun 01, 2012 10:20 am
by rhymenocerous
I love days like today (June 1 2012) where VTI is down 2% and TLT and GTU are up 2-3.5%. I know it's not necessarily good to focus on daily movements because then you lose some sense of the overall trends, but I just like seeing how the different asset classes move against each other. In my mind, it really solidifies the difference between the PP and more traditional portfolios.
The PP is more of a balancing act. You are always holding one asset that is doing well to counteract those that are not. The stock-heavy portfolio is more of a cross your fingers, close your eyes, and pray that those 10% per year average returns magically materialize approach. It really tests an investor's fortitude. This is one area where I think the PP definitely triumphs over the stock-heavy portfolio: it's able to make people more consistent in sticking with their plan, and it tames their innate behavioral impulses.
Edit:
This is funny. An almost identical post was made at the same time I posted mine:
http://gyroscopicinvesting.com/forum/ht ... ic.php?t=2
Re: Why I Love the PP
Posted: Fri Jun 01, 2012 10:29 am
by Storm
rhymenocerous wrote:
I love days like today (June 1 2012) where VTI is down 2% and TLT and GTU are up 2-3.5%. I know it's not necessarily good to focus on daily movements because then you lose some sense of the overall trends, but I just like seeing how the different asset classes move against each other. In my mind, it really solidifies the difference between the PP and more traditional portfolios.
The PP is more of a balancing act. You are always holding one asset that is doing well to counteract those that are not. The stock-heavy portfolio is more of a cross your fingers, close your eyes, and pray that those 10% per year average returns magically materialize approach. It really tests an investor's fortitude. This is one area where I think the PP definitely triumphs over the stock-heavy portfolio: it's able to make people more consistent in sticking with their plan, and it tames their innate behavioral impulses.
Edit:
This is funny. An almost identical post was made at the same time I posted mine:
http://gyroscopicinvesting.com/forum/ht ... ic.php?t=2
LOL! I think we both had an epiphany at the same time. I know we're not supposed to check every day, but I still do.
Re: Why I Love the PP
Posted: Fri Jun 01, 2012 10:44 am
by clacy
I am in love with the PP as well. It helps me sleep at night to know that both "Left-Tail" and "Right-Tail" risks are covered by the portfolio, as well as prosperity.
Re: Why I Love the PP
Posted: Fri Jun 01, 2012 12:08 pm
by MediumTex
rhymenocerous wrote:
The PP is more of a balancing act. You are always holding one asset that is doing well to counteract those that are not.
It's what you might call
"gyroscopic investing."
Re: Why I Love the PP
Posted: Sat Jun 02, 2012 11:51 am
by jackely
I love it when I hear my co-workers groaning when the stock market takes a big plunge and I click on my Morningstar Portfolio Manager and can tell them I'm up for the day. One of them has already seen the light and invested part of their savings in the PP.
Re: Why I Love the PP
Posted: Sat Jun 02, 2012 2:35 pm
by hoost
Yes, I have nearly converted a good friend of mine as well. He has seen the light, and I expect he'll be joining us as soon as he finishes HB's money show audio archives.
Re: Why I Love the PP
Posted: Sat Jun 02, 2012 5:21 pm
by MediumTex
hoost wrote:
Yes, I have nearly converted a good friend of mine as well. He has seen the light, and I expect he'll be joining us as soon as he finishes HB's money show audio archives.
Perhaps the book will help convert more of the tire kickers.
The book comes out in October.
Re: Why I Love the PP
Posted: Sun Jun 03, 2012 1:49 am
by hoost
MediumTex wrote:
hoost wrote:
Yes, I have nearly converted a good friend of mine as well. He has seen the light, and I expect he'll be joining us as soon as he finishes HB's money show audio archives.
Perhaps the book will help convert more of the tire kickers.
The book comes out in October.
I certainly hope so. I will be ordering a few copies to distribute as gifts, assuming it's as good as I expect it will be. (I'm not worried
)
Re: Why I Love the PP
Posted: Sun Jun 03, 2012 6:22 am
by Coffee
This is nothing to gloat about. It's one day. You guys are tripping my fan boi alert.
I'm sure you can find one-day victories with any investment strategy? My return over the past three months is still -.14%.
Some of you guys act like you've found the cure for cancer because your portfolio had a good day.
Set it and forget it, folks.
[flame shield-on]