PP symmetry

seajay · Post by **seajay** » Tue Feb 10, 2026 10:23 am

Data since 1933 for a 4x25 Permanent Portfolio asset allocation where pre 1970 silver was held instead of gold, stock (large cap LC), long term treasury (LTT), T-Bills, PM (precious metal), which might be considered as a portfolio comprised of six 50:50 pairs of assets each pair weighted 16.6%. Measuring the frequency, number of years when each 50:50 pair was the years best (most rewarding total return) assets, and each years worst pair :

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Best        23.3%      14.0%      26.7%      17.4%      10.5%      8.1%
Years       LC/LTT    LC/Tbill    LC/PM     LTT/Tbill  LTT/PM    Tbill/PM
Worst       8.1%       10.5%      17.4%      26.7%      14.0%      23.3%

had symmetry, for instance when LargeCap/LTT were the years best pair of assets so T-Bills/PM were the years worst pair of assets, and vice versa.

Measuring the median value of the actual yearly nominal gains for every years best pair of assets yielded a 15.3% outcome, whilst the median nominal gain (loss) of the worst pair was -0.72%, a combined average of just those two pairs of 7.3%, which was close to the 7.7% median of all of the rest (the other pairs that excluded the years best and years worst pairs).

In short, the PP asset allocation is like holding multiple pairs of assets where for each year one of those will be the best performing, another pair being the worst, where both of those pairs combine to balance out to being similar to the average of the other four pairs of assets. Is inclined to yield a overall average outcome, not be the years best, but importantly not being the worst either. If instead you concentrate your asset allocation to just one single pair, say largecap stock/T-Bills 50:50 for instance, then you run the risk of a high concentration of holding the worst case outcome and where as per the above table LargeCap/T-Bills were the best pair of assets in just 14.4% of years.

Much of investing is about averaging, averaging in (saving) over many years, averaging out (spending/retirement) over many years, and ideally averaging down over time (rebalancing) and avoiding having been highly concentrated in the worst choice asset allocation, which is inclined to achieve a average overall outcome, which is typically a reasonable outcome, avoided having concentrated into the worst choice.

The equal four way split of assets for six pairs of 50:50 is more defensive than just two assets alone. For those that consider the PP to be too conservative a option might be to swap out the LTT for midcap stocks - that tend to be more reflective of the domestic economy in contrast to largecap stocks being inclined to be more global, paired to T-Bills (domestic 'cash') and gold (a non fiat global currency/cash) - that might be considered as being FX neutral, 50:50 domestic (Midcap stocks/T-Bills) and global (LargeCap stocks/Gold).