No where to hide
Posted: Thu Apr 30, 2015 9:11 am
Seem to be quite a lot of these days lately. Looks like any 2015 gains I had are now gone. Gold to the woodshed, yet again, even after another delay in rate hikes. It can't win.
Permanent Portfolio Forum
https://gyroscopicinvesting.com/forum/
https://gyroscopicinvesting.com/forum/viewtopic.php?f=1&t=7204
I remember hearing / reading those housing bubble news stories during 2005-2006-2007 and thinking, "OMG this can't last".iwealth wrote: Dollar is strong, commodities are weak, global deflation, US rate hikes around the corner, strong stock market, relative geopolitical calmness...gold being in the pits is about as surprising as the sun coming up in the morning.
The PP is supposed to be a "market agnostic" portfolio, but it doesn't mean the market itself is agnostic. The market very much so believes it can predict the future and it's saying no inflation or WW3 likely any time soon, so lay off the gold and enjoy the free money and rising equities.
And once you do that it'll be sure to promptly chop your manhood right off.
Are you watching the Bruce Jenner interview or something?iwealth wrote: And once you do that it'll be sure to promptly chop your manhood right off.
Yeah, as I have said a couple of times, with interest rates this low, even if we are expecting rolling real returns of 4% - 5%, we are likely to have more weeks, months & years with negative nominal PP returns. The real returns will just be clustered around a lower number and the portfolio is bound to feel as if it's going nowhere until (If? When?) some inflation kicks in. With inflation at 4% to 5% you would expect a CAGR of around 9% and that would mean doubling your money every 8 years. If there is no inflation and we use a real return of 4.5%, your money doubles in 16 years. Just a slow upward crawl with lots of ups and downs around that line of best fit. At least that is what I am hoping for.Cortopassi wrote: ...Looks like any 2015 gains I had are now gone...
+1KevinW wrote: Guys, we've been through this.
The PP is designed to achieve moderate returns, low volatility, and protect a portion of your wealth against a local economic collapse.
It is not designed to achieve high returns, go up every single day, or track a stock-heavy index allocation.
We're only 4 months into 2015. It's too early to give up on the year. One day's returns are irrelevant.
You can't expect a bicycle to work like a car or for chocolate ice cream to taste like strawberry. Likewise you can't expect the PP to perform to a standard different than the one to which it was designed. If you can't tolerate a one-day drawdown then you should probably be in a portfolio designed to prevent that, such as 100% cash or short term bonds. If you can't tolerate tracking error vs. a conventional portfolio then you should probably be in a conventional portfolio. Sorry, but that's how the cookie crumbles.
I find bitching is just a regular part of the PP. It's really 20% stocks, 20% gold, 20% bonds, 20% cash, and 20% bitching. Bitching is high right now so you probably need to rebalance out of it.Cortopassi wrote: I know, I know. All I am doing is bitching.
Typically as a hedge one holds a high % of bitching when stocks are outperforming. Bitching allocations are then moderate to low when bonds are doing really well. And nobody holds any bitching whatsoever when gold is on a tear. People actually short bitching and buy more gold when this happens.dragoncar wrote:I find bitching is just a regular part of the PP. It's really 20% stocks, 20% gold, 20% bonds, 20% cash, and 20% bitching. Bitching is high right now so you probably need to rebalance out of it.Cortopassi wrote: I know, I know. All I am doing is bitching.
Good one.dragoncar wrote: I find bitching is just a regular part of the PP. It's really 20% stocks, 20% gold, 20% bonds, 20% cash, and 20% bitching. Bitching is high right now so you probably need to rebalance out of it.
Pet Hog wrote: YTD returns (dividends reinvested; Dec 31, 2014 to Apr 30, 2015)
TLT: +0.63%
VTI: +2.27%
IAU: +0.00%
SHY: +0.62%
PP Total: +0.88% (+2.70% annualized)
Inflation: +0.56% (end Dec 2014 to end Mar 2015)
PP real: +0.32% (+0.98% annualized)
YOY returns (dividends reinvested; Apr 30, 2014 to Apr 30, 2015)
TLT: +16.57%
VTI: +12.72%
IAU: –8.48%
SHY: +0.82%
PP Total: +5.41%
Inflation: –0.40% (end Apr 2014 to end Mar 2015)
PP real: +5.81%
Pet Hog wrote: Five-year returns (dividends reinvested; Apr 30, 2010 to Apr 30, 2015)
TLT: +60.28%
VTI: +95.60%
IAU: –0.87%
SHY: +4.31%
PP Total: +39.83% (+6.94% annualized)
Inflation: +8.31% (end Apr 2010 to end Mar 2015; +1.61% annualized)
PP real: +5.33% annualized
Ten-year returns (dividends reinvested; Apr 30, 2005 to Apr 30, 2015)
TLT: +98.82%
VTI: +133.77%
IAU: +163.59%
SHY: +27.34%
PP Total: +105.88% (+7.49% annualized)
Inflation: +21.34% (end Apr 2005 to end Mar 2015; +1.95% annualized)
PP real: +5.54% annualized
Bitching sounds like a bad VP play, should just go 100% PP imo.dragoncar wrote:I find bitching is just a regular part of the PP. It's really 20% stocks, 20% gold, 20% bonds, 20% cash, and 20% bitching. Bitching is high right now so you probably need to rebalance out of it.Cortopassi wrote: I know, I know. All I am doing is bitching.
And therein lies the real problem with the TPP: because of its huge tracking error relative to more conventional portfolios, it attracts assets and adherents during crises, then sheds them in better times. There?s nothing wrong with Harry?s portfolio?nothing at all?but there?s everything wrong with his followers, who seem, on average, to chase performance the way dogs chase cars.
Two days ago I wouldn't have understood the reference but came upon a reference to Schrodinger's thought experiment a couple of nights ago. Alas, I am old enough so that I may forget who Schrodinger was two days hence!madbean wrote: I discovered the secret last year.
Don't look.
I resolved to not look for one full year and when I did last February I had WAY more money than I thought I would.
I'm thinking maybe it's a quantum mechanics/Schrodinger's cat thing. Looking at it affects the outcome so just don't do it.
OK, I'll go here...by my tracking YTDbuddtholomew wrote: And the rout continues...rationalize all you want, but the bottom line is the portfolio is doing absolutely nothing but racking up losses.
+1Kbg wrote:OK, I'll go here...by my tracking YTDbuddtholomew wrote: And the rout continues...rationalize all you want, but the bottom line is the portfolio is doing absolutely nothing but racking up losses.
100% SPY: .88% return
PP: .39% return
Seriously...if you are going to freak out about .49% maybe this investing stuff isn't for you.
+2Pointedstick wrote:+1Kbg wrote:OK, I'll go here...by my tracking YTDbuddtholomew wrote: And the rout continues...rationalize all you want, but the bottom line is the portfolio is doing absolutely nothing but racking up losses.
100% SPY: .88% return
PP: .39% return
Seriously...if you are going to freak out about .49% maybe this investing stuff isn't for you.
Some of these criticisms border on the ridiculous. The YTD tracking error of PP vs SPY is practically a rounding error. If not the PP, then what? Stocks, bonds, and gold have all had a rough and choppy year so far. Nothing goes up all the time and sometimes everything treads water for a bit. If this kind of stuff bothers you, you should be in all cash or on whatever portfolio makes you feel better even if it may be riskier (100% stocks, 60/40, etc). Or maybe put some of your money towards anti-anxiety medication of counseling or something. All this worrying over nothing is likely far more detrimental to your finances than obsessing that your investment portfolio isn't doing as well as you'd like.