Ray Dalio All Weather Portfolio article: robberger.com/ray-dalio-all-weather-portfolio/

Actually, it was the late Harry Browne who pioneered the idea of four potential economic conditions. He also came up with a portfolio that he labeled the Permanent Portfolio for investors who wanted a low a low-risk moderate return setup. Basically he advocated for a 4 x 25% portfolio composed of long-term treasuries, stock (indexed), gold and cash with rebalancing bands set at 15%and 35% for any of the assets. And the last time I back tested this going back to 1975, it has delivered inflation adjusted returns of around 4-6% with remarkably low volatility.

Two years later and still, in my opinion, the best “All Weather Portfolio” review I have seen. “Tats” email certainly “set the table”, but Rob’s review was the most thorough I have watched. I appreciated the Portfolio Visualizer “tutorial” and going the extra mile on the “leveraged AWP” comparison.

This video was near prophetic! Rob you're making a wonderful contribution by sharing your wisdom.

Another good video Rob, thx. WRT to the leveraged portfolio, the expense fees are too high for me. I like my low-cost vanguard index funds!

Wow thank you Sir. For giving us your experience for free. I just subscribed a week ago but I have been watching a lot. You are a genius. I'm listening your book in Audible, you have lots of knowledge. I'm still waiting for another book 😊.

great video!

Fantastic video! I can't help but to think how this way of investing could work with just a couple of tweaks or even just adding a Covered Call strategy for income possibly even selling Put options for income when volatility is declining. Fascinating ideas are floating around my mind after watching this and all with less risk!

Great videos

Awesome video

I hate to say it but this is some advanced stuff. I’ll have to come back and break this down to further understand.

Hi Robb. I have a Sitting Bull approach and avoid fees at all costs; 85% FZROX 15% FZILX

Hi Rob, I'm a new invester, do you suggest me to stick with 2X profolio?

Hi Rob! New subscriber here - really appreciate you doing this, I've been looking for someone to break down this portfolio in today's environment, given that Bonds are not the greatest thing to hold at the moment. Thanks for the insight.

Rob what do you think about switching the allocation of gold and commodities to 20% each and bonds to 15%? I think going forward commodities and gold are severely undervalues to equities, and would return more than that large allocation of bonds.

From November 07 to February 09 the S&P 500 fell by 50%. That's real money folks.

thanks

looks like AW Port was least correlated to the market, so the best performer?

Is it possible to create a weather portfolio without bonds? Or do you know an asset to substitute the bonds?

Professional criticism! Great review! Still deciding which to invest into but S&P 500 is a sure fire!

Mr. Berger, what do you think of my retirement portfolio? VWNFX 22%, VEXRX 40%, VEXAX 38%

Rob - love the portfolio reviews! I bet someone has already asked, but if not, will you review Paul Merriman's Ultimate Buy & Hold portfolios?

@rob_berger

3 жыл бұрын

Yes! Paul is a good friend of mine and it's on my list.

Dalio recently said not to own bonds. So what would replace bonds in the all weather portfolio? I’m thinking of using this portfolio to invest my emergency fund.

@rob_berger

2 жыл бұрын

It's a good question, and I've reached out to him for an answer. So far, no response.

VWENX: 45% VWIAX: 45% VBIAX: 10% Retirement in 3-4 years, so I'm looking for less risk & more security.

Excellent video summarizing Dalio's All Weather Portfolio! Good point warning about holding large amounts of Treasuries in a portfolio in this interest rate environment! What do you think about replacing those with long term and Intermediate Treasury funds with TIPS? It gives you the same low Std Deviation qualities without the risk of rising interest rates? Based on the Four Quadrant chart, it seems like using TIPS is more aligned with Dalio’s portfolio strategy than using Treasuries, to smooth out returns. Thank you for such a great video.

@rob_berger

2 жыл бұрын

I think TIPS have a place in a diversified portfolio. That said, I'm not sure they fit into Ray Dalio's portfolio because they behave very differently than the long bonds. I wish Dalio would comment publicly on this issue, but so far all I hear him say is that cash is trash and so are bonds.

I'm 61 and plan on retiring at 63. I have 25 percent in VWENX; 35 percent in VTI; 20 percent in VXUS; 10 percent in GLD and 10 percent in ARKK - would love to hear your assessment. Thanks!

Hi Rob. This is my portfolio: VFV 60% XIU 15% VIU 15% VEE 5% CGL 5% These ETFs from TSX Cheers

23:40 impressive that you were - at such a young age - deploying savings into such retrospectively great deposit rates - I had basic passbook savings account at that time

B..but.. In chapter 5.2 of "Master the game" Robbins says that despite skyrocketting interest rates the all weather portfolio back in '70s had only one bad year so that Robbins advises not to listen talking heads that they know what season comes next. What'll you say?

Hi Rob. I constructed this 6 funds conservative portfolio for lump sum Investing: sptl 20%, schr 20%, spmb 20%, min 15%, vti 12.5%, xlv 12.5. Small drawdown in portfolio visualizer. Please tell your opinion.

@jrlvnv508

Жыл бұрын

It hasn't back tested very well compared to the the 3 fund portfolio. There is a slight decrease in risk but not enough to justify the lack of returns IMHO

What if you overlay the Dalio and S&P. When the S&P is above the line of Dalio's, you buy Dalio. When it's the opposite, you buy the S&P. Knowing they both follow the same general path, wouldn't you get the better value.

I'm a big fan of M1 Finance, Portfolio Visualizer and the All Weather Portfolio. I agree with your finding how long term bonds are really a drag on the All Weather Portfolio in this time period. I think instead of a static percentage allocation to long term treasuries, the All Weather needs to be more flexible and adjust the percentage depending on interest rates. I did have a significant amount of money in the All Weather, but decided to ride the wild pony last year to large returns in the stock market. I still keep a small percentage in All Weather in M1 Finance. I like it because if I see dark clouds ahead, it is easy to adjust All Weather to a higher percentage and rebalance. Enjoyed your 2x analysis. I never thought of that option.

@theWebWizrd

Жыл бұрын

Your comment showcases what the All Weather portfolio is explicitly constructed to fight *against*; the core idea of the portfolio is that we cannot predict the future, so we prepare for all four possible outcomes (being a matrix of higher/lower growth than we think, higher/lower inflation than we think). Once you start changing it with your own bets on how the future will be, you aren't investing using that philosophy, you are doing a fundamentally different kind of investment (a directional bet).

Hi Rob, I really enjoy all your videos but this one hit the mark for my current situation. I'm 64 and retiring later this year. Unfortunately, I've taken the advice of advisors based on a simple risk assessment test. Not a paid advisor but a company offering of talking to someone once a year from our 401K. So my wife and I are now in 60% bonds as we approach retirement. This is obviously not working out as bonds are falling faster than stocks with the current inflation rates climbing and the fed raising interest rates to combat the problem. Now I don't know if moving a larger percentage to stocks is good timing. I hate taking a loss on the bonds but not sure what to do.

I’m years old. What portfolio would you recommend for retirement? I just don’t know where to dump all my cash. It’s all confusing

@jokerbmwe30

2 жыл бұрын

Most people are some years old. It depends on whether those years are 66 or 16 😉

Hi Rob - thanks for the video, and your offer. Invested assets: #1-3 tax-deferred and traditional. #4-12 in a self-managed taxed brokerage account. 1. TRRJX (IRA) - target date 2035: 11% 2. FSKAX (roll-over IRA) - large growth index: 49% 3. FBGRX (roll-over IRA) - large growth blue chip: 6% 4. FSPGX - large growth index:7% 5. IWF - large growth: 3% 6. EGFIX - large growth: 2% 7. VYM - large value: 7% 8. IWR - mid-blend: 1% 9. PXSGX - small growth index: .05% 10. FSPSX - Int Dev mid-large blend: 2% 11. MWTIX - bond fund: 5% 12. VWALX - bond fund: 5%

@Random-yq1wu

Жыл бұрын

Messy, rollover & combine accounts.

@jensallis2

Жыл бұрын

@@Random-yq1wu Rob - is that you?

@Random-yq1wu

Жыл бұрын

@@jensallis2 No, just random poster:)

@jensallis2

Жыл бұрын

Ok thanks

OK- tear up my portfolio please: 25% US Large Cap, 20% US Small Cap 10% US Micro Cap 5% International small-cap Ex-US, 40% Long Term bonds. I'm scoring a Sharpe ratio of .88, a Sortino of 1.33 (I don't understand Sortino ratios), a Standard Deviation of 9.73 with a CAGR of 9.33. When I look at portfolio allocations I am always excited when my SD is less than my CAGR. Is that a silly way to think of things? This portfolio is 88% correlated with the market. It seems to capture about 66% of the upside while and about 40% of the downside (judging from the best and worst year calculations against the Vanguard 500 Index Investor). Of course it is also not for the faint of heart... but what do you think??? I'd like you to talk about this one as a good example of a maximally aggressive tilt on a 60/40.

@linkbelt111

2 жыл бұрын

You didn’t mention your age, as that would be a big factor for me if I was looking at it.

@Random-yq1wu

Жыл бұрын

I honestly think there is no reason to own small cap, micro cap, & international anything.

Doesn't Vanguard have minimums to buy? Does Fidelity have similar funds?

@SKITTLELA

2 жыл бұрын

Vanguard only has minimums for index funds ($3,000.) You can buy ETFs at whatever the market price is, though. Basically the same thing--identical funds. Expens ratios on ETFs even tend to be a bit cheaper.

for backteting you can do -100 for cash if you wanna double everything.

Rob, could we get an update on this portfolio strategy? Curious as to this past outlier year of both bonds and equities falling in synch... thanks for your great information!

You cannot use leveraged ETFs to mimic leveraged returns of the underlying for any duration longer than one day

First and foremost, thanks for taking a look at the Ray Dalio all weather portfolio. Some points of reflection 1: I suppose if one starts their investing young enough, in a tax deferred milieu, that one can be ok with a 7.5% compounded growth...long term. That rate may not be fast enough if you’re starting late. Like me : ( I think though that rate is on the low end. The average I’ve read is around 9.5% long term. 2: while the s& p 500 grows much more, if we look at the years or periods that it took a nose dive, would you or anyone want to be retiring in that year? * the growth is great but if your nest egg gets cut in half when you retire or are soon to retire then it’s kinda disconcerting. 3: I’ll have to watch this video again and see what you did with that 2x Ray portfolio. That looked cool. it was because of the bonds, that are currently (5/21/21) doing poorly, that I made the stocks 35% of the portfolio instead of ray’s 30% However, it’s to be expected that all asset classes have a season that they do well in and a season or so that they do poorly in. So, is it safe to say that the current season is not one for bonds? Idk. Also, I’ve posted elsewhere on your videos a revised all weather portfolio, where I took that 35% allocated for stocks and cut it roughly in half. Half went to either VOO or VTI, while the other half went to innovative disruptive stocks through ARK I’ll come back to edit this with the break down. I’m trying to have my cake and eat it too. Lol. Doubtful I’m sure, but I thought that using cathie woods investing strategy would bump returns, while still using bonds, gold, and commodities to balance it. But, I’m new to all this. Be back later with that allocation of arkk-arkq-prnt-izrl arkw-arkg and so on

@219garry

2 жыл бұрын

EXACTLY. If your portfolio is cut in half like a year before or after you retire you are kinda up shitz creek IMO. I would imagine if someone was extremely lucky they'd be in cash just before they retire and have the market tank. Then they would probably set for life going all in.

How about a portfolio of 50% SP500, 50% cash? We can also play with the cash, if SP500 goes down 5%, buy in 5% or adjust these numbers to your likings.

I thought leveraged ETFs shouldn't be used as a long term investment because of the impact of daily leverage resetting. Am I missing something here?

@SKITTLELA

2 жыл бұрын

I thought so too. Although in his video about leveraged ETFs, I think Rob believes it's okay to use in a bear market because it's more likely to rise. The problem is exiting if it's in a taxable account.

I know this comment is 2-3 years after video published but we are in kind of interesting times in the market In your video, back in published time, WORST year for All weather Portfolio was 4% which is great! Yes, limited upside but such sleeping well downside 2 years later: Worst year for All weather - 17.42% and SP500 in same time frame 18.19% but sp500 double CAGR...

Thanks again for video. To me the most interesting point had to do with current bond yields. I see so many articles and portfolios that shrug off yields today compared to the past many decades. I think that is a big issue not considered enough or discussed. Thanks for pointing it out...don’t feel so crazy. If yields were 5+% I think it would be easier to create a great retiree portfolio. Today, not so simple.

@jrlvnv508

Жыл бұрын

Care to update your statement now?

Ron I always wonder why you haven't got a C.F.P, I know you don't need the money but since you enjoy it so much.

@jrlvnv508

Жыл бұрын

Same as Dave Ramsey.

Rob - enjoy your videos and very informative. Keep up the good work.

Thank you Rob for the great content! Here's my portfolio. I'm being charged 0.75% for management fees on this actively managed portfolio, although I'm learning it's way better to go with passive investment using index funds. Total value of the portfolio is 70K, I'm 40 and shooting to retire at 55. I'd appreciate if you'd analyze my portfolio. Thank you Symbol % Of Account VOO 36.45% IEFA 25.85% IWR 8.63% IEMG 8.25% MUB 8.21% Cash & Cash Investments 5.69% HYG 3.93% SCHH 2.98%

@alexvari6166

3 жыл бұрын

To add, this is in a taxable account. Thank you sir!

Great video Rob. I've been looking to trying to disaster proof my post-retirement portfolio and KZread just popped you up. I'm in Canada and have a self built portfolio that is optimized for an income stream, so it's heavy on Canadian REITs, utilities, financial and utility covered call ETFs etc and mortgage lenders (Mortgage Investment Corporations). Overall my portfolio pays about 6.5 points with a few points in capital appreciation, around 9% overall last 5 years. It took a fair hit last spring, but the cash distributions were unaffected. I'm more concerned now about protecting from a long term bust that eats into the distributions. I have added quite a bit of gold, about 12% so far and I will probably increase that to at least 15%, as the current goings on can only end in disaster. Being an income cash flow guy I have most in a Canadian gold ETF, HGY, that just holds SPDR GLD shares and writes covered calls on 1/3rd, so it captures most of any upside and pays about a 6-7 point distribution monthly from call premiums. Also have Sprott units, which, being allocated gold/silver I consider a safer holding than GLD.

PRWCX/VBMFX 40/60

I’ve been wondering about this portfolio for a while, thanks for the detailed breakdown!

Interesting that after this video the portfolio had a drawdown of more than 20%. All in all you'd be better off by buying the S&P500.

Fun fact, between January 2000 and 2020 both long term treasuries and gold beat the S&P 500.

@rob_berger

2 жыл бұрын

True if you invested a lump sum in 2000. If you dollar cost averaged, say with $250 a month in 401k contributions, the S&P 500 wins by a wide margin. It also wins on a lump sum basis if you don't pick a starting year near the tech bubble implosion.

Rob -- just came across your informative videos. Great job. I am searching for a video that I watched about 8 to 10 years ago, and was very similar to the 7 - 12 Portfolio, but was broken down into even smaller segments. It was an older gentlemen in the video, and might not have been a 'professional' but he had data going back years. A large part of the video was what he was withdrawing in retirement. If by any chance, you have seen this video in your research, please let me know. Thanks!

Here's one, 25% each VTI VIOV UPRO TMF

You know more than you think.

If you were to create a portfolio of all 8 ARK ETFs in a pie using M1 Finance what percentage of each fund would they be

Wow - what a thorough analysis. Thank you Rob!

This year down 13%?

Facts are facts. Most people make more money with lower volatility.

Thanks, those are very interesting materials. I was wondering about the role of China in this portfolio. I think some of the thought from Dalio are very in line of change of world order, potential debt crises in EEUU and Europe. So as I imagine Dalio's All weather portfolio would perhaps with more particular present in China and less in debt. Maybe the inclusion of China is happening with the International Stock market etf recommended. With regards debt I guess is always good to have a proportion, however I think Dalio has a number of books just talking about debt and how the are pretty much very affected for the easing of Central Banks, so I think to have global debt is in line, but I wonder if so much. Many thanks

Not sure this aged well. Concept is right for the times, and should be pos now. But bonds got killed.

Yaar bgmi ban ho gya😭😭😭

All weather saved my ass in covid crash xD. It really depends upon your risk. If you are just buy and forget type investor s&p500 will be for you. But if you are investor who makes a living from his investment. All weather is for you because in bad times you need cash and don't want to be 50% down xD. Also not everytime the market will recover so fast as it did in covid crash

Austrian economists and investors (Schiff, Dalio himself, Rogers, Rule, Kiosaki) are pretty much in consensus that a worldwide global crash in the stock, bond, and real estate bubbles is coming, resulting in an extended much lower standard of living for most Americans. Gold seems the most important sector if they are right.

50% RYLD 35% VOO 2.5% ARKK 2.5% ARKF 2.5% BDN 2.5% QYLD 5% AMC

@brucehazen8982

2 жыл бұрын

Ouf. You've had a haircut

The very ultimate portfolio, ( the word of God the Bible)