Tagged: permanent portfolio

Mebane Faber Compares Eight Portfolios

A recent blog post by Mebane Faber compares eight different asset allocation strategies. In his comparison, the Permanent Portfolio did not have the highest returns (it likely never will), but it had by far the lowest drawdown/volatility of them all (-12.7% compared to -30% or worse). So the Permanent Portfolio gave the smoothest ride to get those returns. As we’ve covered before, I feel a portfolio with low volatility is very important for controlling investor emotions and ultimately achieving higher returns. A lot...

Drawdowns and the Permanent Portfolio

Let’s talk portfolio drawdown and investing risk. A drawdown in the sense of an investment portfolio is basically a loss it has experienced in the past. In particular, a lot of people are concerned with maximum drawdowns. This can give an investor a good idea about how an investment has done in the past so they can perform a gut check on themselves. For instance, a maximum drawdown for a 100% stock portfolio has approached -90% during the Great Depression....

Permanent Portfolio Basics

Investing should be simple. Keeping investing simple means sticking to the basics. This post I’m going back to the investing basics to help new followers of the Permanent Portfolio get a solid understanding of how the strategy works. First, understand that investing in a way that’s simple means following some simple rules. Harry Browne’s 16 Golden Rules of Financial Safety are those rules. If you follow these rules religiously, along with the Permanent Portfolio allocation, you will have a tough...