Thanks to Tony Robbins new book called MONEY Master the Game: 7 Simple Steps to Financial Freedom, I get to know Ray Dalio. He has strong believe of 4 seasons portfolio that can weathers across the economic cycles at all times.
Here’s the asset allocation that Dalio came up with for this strategy:
30% Stocks
40% Long-Term Bonds and 15% Intermediate-Term Bonds
7.5% Gold and 7.5% Commodities
Here's mine.
Structured : Preference Shares and Bonds.
Ray's bond ~55% in total. If i include relative higher fixed returns from RMB and AUD, probably about 25-30% range which is about half from it.
Commodity: This is a little tricky to gain exposure to it.Using commodity and energy related counters from my stock equities assuming their close relation to represent the segment, i am not far off in percent wise. This do reduce my equity portfolio volatility indirectly.
Gold : Investment is virtual with reputable banks. Why single out gold from commodity can be easily referred to rationale on why National Banks hold Gold. In this segment i am pretty low (1.5%) compared to four season portfolio (7.5%).
Stocks : Align in percentage term after deducting commodities and energy related counters.
So how do i measure up after re-calibrating my definition and removing other cash components ?
Conclusion
I can see that my portfolio has slightly higher volatility and less down side protection with fewer gold for higher chance of better returns.
Few questions in my minds. I would presume Ray based off US currency which i am not and secondly what if we have hyperinflation, will this strategy continues to work ?
Cory
24 Jan 2015
Here’s the asset allocation that Dalio came up with for this strategy:
30% Stocks
40% Long-Term Bonds and 15% Intermediate-Term Bonds
7.5% Gold and 7.5% Commodities
Here's mine.
 |
| Cory Portfolio |
Ray's bond ~55% in total. If i include relative higher fixed returns from RMB and AUD, probably about 25-30% range which is about half from it.
Commodity: This is a little tricky to gain exposure to it.Using commodity and energy related counters from my stock equities assuming their close relation to represent the segment, i am not far off in percent wise. This do reduce my equity portfolio volatility indirectly.
 |
| Four Seasons |
Stocks : Align in percentage term after deducting commodities and energy related counters.
 |
| Cory Portfolio Re-Calibrated |
Conclusion
I can see that my portfolio has slightly higher volatility and less down side protection with fewer gold for higher chance of better returns.
Few questions in my minds. I would presume Ray based off US currency which i am not and secondly what if we have hyperinflation, will this strategy continues to work ?
Cory
24 Jan 2015
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