Using leverage on PP given its low volatility

[helpme]

Low volatility portfolio usually comes accompanied with higher leverage. Is it a good idea to use leverage on PP given its low volatility?

[AnotherSwede]

Possible? Sure:
http://gyroscopicinvesting.com/forum/va ... 4/#msg4734
Also at least a few threads about replacing whole or part of cash with equal parts of risky assets.

Good idea? It depends.

[MediumTex]

Low volatility portfolio usually comes accompanied with higher leverage.

I don't understand what this sentence means.

I think you are asking if it would be useful to try to juice the PP returns by using leverage in its volatile assets.

I would say you might be able to juice returns, but you are also going to juice portfolio volatility and that starts moving you away from what made the PP attractive in the first place--i.e., low volatility and consistently positive real returns.

If you want higher returns and can stand more volatility, why not just go with another portfolio that is already more volatile and already promises higher returns?

A lot of your posts have a "swinging at a PP pinata" quality to them.  If you are really interested in learning about the PP, read some old posts here, read the monster PP thread at the BH site, read Harry Browne's writings, and consider picking up a copy of the recent PP book.  All of your questions will be answered from many perspectives.

It's a lot of fun when you first learn about the PP.  It's unlike most other allocations and for many people learning about it is endlessly interesting.