What do you think about these portfolios?
To the investing enthusiasts on here - what do you think of these two portfolios for long term investing horizon? I am happy to take market risk (~15% std. dev) Portfolio1: SPY: 35% XLK: 15% EEM: 12% INDA: 8% TLT: 15% GLD: 15% Portfolio2: SPY: 90% TLT: 80% GLD: 30% (2x levered with the help of corresponding levered ETFs) (let us please ignore the “levered ETFs are risky” / “they decay” concerns for now)
Are you really going to make more in interest on TLT than you are going to pay in margin interest?
That’s a great question. Since I would be using leveraged ETFs the cost of “margin” is only the expense ratio of the ETFs. This is around 0.95%. With this said, the Interest on TLT has been higher than this expense ratio. Moreover the total return of TLT has been well above the expense ratio. Now when we think about the future is when things get tricky. Folks like Ray Dalio are saying bonds would be bad assets to hold for the future considering debt monetization and interest rate increases that they think are bound to happen. I don’t know what to think.
You said you’re buying 200% worth of assets.
Curious about the process. Where do you get the data, and (back)test the portfolio - what tools do you use for research? I don’t have the fundamental knowledge - started reading the intelligent investor and other things here and there, but then gave up. Where did you start? Should I pick up a textbook on portfolio theory?
Portfolio2 percentages don't add up to 100% so I go with portfolio2
Portfolio2 adds up to 200% to indicate 2x leverage.
Alright. I would still say 45% on spy (or SSO) though. When talking about portfolio percentage > 100% just doesn't sound right