Here are some interesting graphs. Given that our economy is under huge speculation wondering anybody have resources on modern portfolio designs. Though lazy portfolios like Yale portfolio or Boglehead is still relevant wondering about upcoming asset classes on DeFi/btc, futures and so on, inverse leverage. #personalfinance #investments
I’m fascinated by this subject, and I love the information you’ve posted here. Here is a link to a podcast that teases through some of the concepts you are looking at https://youtu.be/4LqDdENaFdI. This guy Harry Dent, speculates that India will be the next boom economy (like China during the early 2000’s. I currently have about 210k invested primarily in large cap US companies. And about 55k in crypto, and another 70k in home equity. The more I learn about crypto and DeFi the more opportunity I think is there if you aren’t afraid to roll up your sleeves, lower your ego, and try to learn as much as possible to get in on some potentially huge gains later down the road. Just my thoughts.
Look at small cap as well. In terror lately
I'm skeptical of seeing such "cyclic" trends because what is to say that there haven't been structural changes in the economy in the last 10 years? What is to say that the ex-US economy will never be as good as the US economy going forward? Betting on a "return to mean" sounds like gambler's fallacy. Also we kinda saw that fixed income and equity aren't totally uncorrelated. When people get spooked, they pull out from both. In part I blame that to modern portfolio theory because it has tied up stocks and bonds into a single combined asset class: the "portfolio". Modern portfolio theory only works if you ensure that the conditions of the market have zero impact on how and when you invest and divest.
The entire world and asset classes are somehow correlated but diversification is purely meant for reducing some downside. On the note of return to mean, some how the stock index needs to attach to the economy which begs the question of "what would be the yield by then". All economies are up since COVID crash but some are not valued as much as US tech or S&P.