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Tlt is hardly an inflation hedge , just the opposite .reits are very un dependable as to what drives them .
You don’t want so much in bonds as tips and tlt are still bonds at heart and while the inflation kicker rises with tips , the bond component plunges as rates rise.
Way way to interest rate driven in my opinion.
You are trying to build a better dr Frankenstein version of the pp or butterfly …this has been attempted endlessly with no success.
About the only thing I would do I buy some dbc and gbtc with part of the gold budget.
Last edited by mathjak107; 07-15-2021 at 10:11 AM..
Seems reasonable to me as long as 50% equities satisfies your stock exposure. A 4% exposure to anything is almost too small to be worth having but I like the way you've spread it around but might make the allocations more equal. Good mix. Are we gonna call this the Lazy Dad Portfolio?
Be forewarned tips are only slightly less volatile then Tlt ..they will get hit hard if inflation and rates rise .
Way way to interest rate sensitive …that is why t bills or cash instruments are used in the pp and butterfly
It seems like our terrible/evil Federal Reserve is going to let inflation run amok for a while. They said they are not tapering purchases of bonds soon. And yet they think inflation will moderate, yet it wholesale index is 7% a record increase.
Will bonds still get crushed in nominal dollar value if inflation runs wild, yet Fed continues stupid easy money policy? Obviously purchasing power of your savings will erode, but will the nominal value in dollar decline or no because people will see Fed refuses to stop easy policy and bonds will be where they are at low rates??
Last edited by Wolverine607; 07-15-2021 at 11:06 AM..
Long bonds are the last thing you'd want to own. Stocks will be good in the long run, but if a period of sustained high inflation hits there would be a painful period of valuation compression at first. Gold is one of the classic inflation hedges of course. Cryptos are way too new, and speculative, to have any sense for how they would react to high inflation IMO.
So in summary, stocks at your nominal allocation. Rest of the money in gold and short-maturity notes. People with a large net worth might consider also buying farmland to rent out.
The core portfolio is from the fidelity insight newsletter which I have used for more than 30 years .
The inflation protection side is really a ray dalio concept .
He likes 20% as an inflation /weak dollar hedge with 5% in gold ,Bitcoin , commodities and cash instruments
…I won’t put that much in bitcoin …so i weight gold the heaviest , then commodities less , and bitcoin even less.
as of now i have 1-1/2% % bitcoin , 2% commodities , 5% gold.
if prices fall i will add
Last edited by mathjak107; 07-15-2021 at 12:09 PM..
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