September 20, 2020

Episode 17: Portfolio Reviews As Of September 18, 2020 And A Comparison Of The Golden Ratio Portfolio Against The Bogleheads Three-Fund Portfolio

13 minutes

This is our weekly portfolio review of the portfolios you can find at https://www.riskparityradio.com/portfolios

We also compare the Golden Butterfly Portfolio with a Boglehead's Three-Fund Portfolio using the tools at Portfolio Visualizer. Here is a link to that analysis:

https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&mode=1&timePeriod=4&startYear=1972&firstMonth=1&endYear=2020&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&asset1=Gold&allocation1_1=16&asset2=LargeCapGrowth&allocation2_1=14&asset3=SmallCapValue&allocation3_1=14&asset4=LargeCapBlend&asset5=LongTreasury&allocation5_1=26&asset6=TotalBond&asset7=TreasuryBills&allocation7_1=6&asset8=TotalStockMarket&allocation8_2=40&asset9=Commodities&asset10=TotalBond&allocation10_2=40&asset11=ShortTreasury&asset12=IntlStockMarket&allocation12_1=14&allocation12_2=20&asset13=IntermediateTreasury&asset14=REIT&allocation14_1=10

The Golden Ratio is a conservative portfolio that is designed for medium to long-term needs. It is based on the mathematical golden ratio known to the ancients, which is approximately 1.618 and is represented by the Greek letter phi. It is comprised of five asset classes in seven funds that are weighted by successive applications of the golden ratio: 42% stocks (split into 14% large cap growth (VUG), 14% small cap value (VIOV) and 14% low volatility (USMV)), 26% long-term treasury bonds (TLT), 16% gold (GLDM), 10% REITs (REET) and 6% money market (SPAXX), Since 1970, it has a compounded annual growth rate (after inflation) of 7.0%, and an expected permanent safe withdrawal rate of 5.0%.

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