Effectively flat for the week. Not much change, except moving into gold more, which I didn’t expect. This is still a fairly aggressive portfolio historically. On November 22th, 2019, the portfolio rebalanced to:
72% SPY , 12% TLT , 16% GLD
Effectively flat for the week. Not much change, except moving into gold more, which I didn’t expect. This is still a fairly aggressive portfolio historically. On November 22th, 2019, the portfolio rebalanced to:
72% SPY , 12% TLT , 16% GLD
I’ve spent a couple hours on your blog tonight just going through all of your posts and I’m fascinated. I do have a few questions I hope you can answer for me.
1. Have you looked into using like VTI ETF instead of SPY? Seems like your overall returns would be ever so slightly higher in theory if you used VTI. Maybe you use SPY because of the liquidity?
2. How would you beneficially use a leverage ETF with this strategy? Ex: If recommended SPY % is >60% use 3x leverage ETF instead of regular SPY? Any findings on something like that would be cool to hear about.
3. What do you use for backtesting? I heavily rely upon Portfolio Visualizer but this gives me yearly returns and only allows me to select one static asset allocation %.
Overall, fascinated by the strategy and may look into researching more to see about implementing it myself. I think the general consensus is that the US stock market seems a bit expensive right now so even though I’m in my 20s it feels right not to be 100% in stocks and potentially catch a 40% drawdown of assets.
1.) Your probably right about VTI. I have ran tests with RSP, and it does improve the portfolio some. I haven’t changed thought because I like being able to test the portfolio way back into history. With my limited access to data, I can’t do that with anything but the S&P and Dow. The liquidity issue probably would mater if I had multiple millions to trade.
2.) My next post will be on the leveraged version. Theoretically you can use the leveraged ETFs for this strategy, and luckly there are 3X versions for each component. I’ve just used standard leverage from the broker in the past, but have thought about using the ETFs in my retirement accounts since you can’t use pure leverage there, but can use the ETFs
3.) Mostly excel, which might be laughed at by professionals. But I’m very adept with excel and built everything from scratch.
BTM,
Thanks for the response. Yeah in the retirement account you could look into using ProShares leverage ETFs. Those are probably the best leverage ETFs IMO.
SPY = SSO
TLT = UBT
GLD = UGL
I know the portfolio is changing % every week but even if you use your “average” over the whole time period 60% SSO, 32.5% UBT, and 7.5% UGL you get 19.18% CAGR net of expense ratio with 13.54 Stdev, -16.05% Max DD since Jan 2011.