So I'm new to investing and I've been reading about the benefits of this All Weather Portfolio.
From my research, it seems like the way to go but when I talked to my fiduciary advisor he told me to stop trying to find silver bullet solutions and just buy a mix of vanguard 80% stocks 20% bonds.
Do any of you have experience with this asset allocation?
Is it worth looking into any further?
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The All Weather Portfolio is a diversified asset mix first introduced by hedge fund manager Ray Dalio and popularized in Tony Robbins’s book MONEY Master the Game: 7 Simple Steps to Financial Freedom.
The asset allocation of the portfolio is broken up like this:
40% long-term bonds
30% stocks
15% intermediate-term bonds
7.5% gold
7.5% commodities
A few more fast comparisons:
When back-tested during the Great Depression, the All Weather Portfolio was shown to have lost just 20.55% while the S&P lost 64.4%. That’s almost 60% better than the S&P.
The average loss from 1928 to 2013 for the S&P was 13.66%. The All Weather Portfolio? 3.65%.
In years when the S&P suffered some of its worst drops (1973 and 2002), the All-Weather Portfolio actually made money.