EnoughWealth wonders if our investment strategy only adds value under certain market conditions. As a first step let's look at when the out-performance relative to the 60/40 portfolio happened:
The graph simply takes away the monthly return on the Vanguard 60/40 portfolio from Moom's actual results. We see there are periods of out- and under-performance throughout the period. Not surprisingly, it was weaker in 2023 in particular. I didn't do well in implementing the target portfolio strategy last year. Here is a graph comparing the performance of this theoretical portfolio and the Vanguard portfolio:
This looks more consistent. This portfolio is theoretical because it consists of a mix of actual investible funds and non-investible indices.
Bottom line, is I think it is a good idea to add things like managed futures, gold, real estate etc to your portfolio. It makes a real difference.
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