Trading systems and asset allocations are not the same thing.
Browne wrote a book explaining his portfolio in hopes that people would understand it. If you understand it and decide to use it, you're making your own decision.
> Trading systems and asset allocations are not the same thing.
Asset allocation is just a trading system that changes much less frequently and has a different belief system underpinning it. They are both fundamentally decision frameworks about how to spend your money.
The tragedy with this article is that a lot of the advice is sound. Once people get to Rule #11 they have a lot of reason to trust this author and adopt his bulletproof portfolio. And then they learn the hard way how it wasn't bulletproof.
The author really should have known better. The prescriptive recommendations in Rule #11 contradict so much of the otherwise sound advice.
Nothing is bulletproof, but you have to do something and Browne's portfolio has less risk than most. It sacrifices some returns to achieve that, but if you're retired or nearly so, it's a solid choice.
>It sacrifices some returns to achieve that, but if you're retired or nearly so, it's a solid choice.
In that scenario, especially given a healthy nest egg, it absolutely makes sense to optimize locking in an income stream at the expense of limiting the upside. Once you have "enough" money close to retirement, it's mostly about not taking risks for potential gains that won't really benefit you.
For someone in a different situation, it will often make sense to go for higher average returns over time.
(All of which is pretty much bog standard financial planning advice.)
Yes, exactly! Nothing is bulletproof and you have to do something. There Ain't No Such Thing As A Free Lunch. You can't depend on anyone to figure out a low-risk plan for you, not even Browne!
Browne wrote a book explaining his portfolio in hopes that people would understand it. If you understand it and decide to use it, you're making your own decision.