Episode Details
Back to EpisodesEpisode 13: Portfolio Reviews As Of September 4, 2020 And Further Discussion Of The All Seasons Portfolio
Description
This is our weekly portfolio review of the portfolios you can find at https://www.riskparityradio.com/portfolios
We also discuss the All Seasons Portfolio in a little more depth, including why it may not be the best representative of a risk-parity style portfolio and what it is missing.
The All Seasons portfolio is a reference portfolio that is modeled after Ray Dalio's All Weather portfolio and is described in "Money: Master the Game" by Tony Robbins. It is a very conservative portfolio that is comprised of four asset classes in five funds, allocated as follows: 30% total U.S. stock market (VTI), 40% long-term treasury bonds (TLT), 15% intermediate-term treasury bonds (VGIT) 7.5% gold (GLDM) and 7.5% commodities (PDBC). Since 1970, it has a compounded annual growth rate (after inflation) of 5.6%, and an expected permanent safe withdrawal rate of 3.8%.
Here are the links I mentioned to theoretical risk-parity portfolios from the literature:
Risk Parity Portfolios: Efficient Portfolios Through True Diversification: https://www.panagora.com/assets/PanAgora-Risk-Parity-Portfolios-Efficient-Portfolios-Through-True-Diversification.pdf
Risk Parity: Silver Bullet Or A Bridge Too Far: https://www.callan.com/wp-content/uploads/2018/04/Chapter-4-from-Managing-MultiAsset-Strategies-2018.pdf