Older paper (2012) but valuable for two reasons: 1) is realistic about correlation, and 2) pays special attention to correlation in times of market decline, such as the one that just preceded the paper and the one we’re going through now.
I used to be pretty strict in my pursuit of low-fees. How about .5%? - no, lower. .3%? no, lower. .06%? - ok, that'll do. After almost two decades with my ears pinned back, I recently took a look around to find out I can relax - the War over Fund Fees now appears over. DIY investors won.
Time for another addition to the Risk Parity Basics library for those getting started with portfolio construction. This time: strategic asset allocation. What is it? What types are there? How can it help investors?
Risk Parity Basics series: All about withdrawal rates: what they are, the difference between Safe and Perpetual, and why they matter, especially for RP. In the embedded video, I'll show you how to find them using Portfolio Charts.
A recent episode of ReSolve Riffs got me thinking: in volatile markets, should RP portfolios go the opposite of how the market is trending and buy what is getting trampled? Or, in the name of lowering volatility, should they get out of those free-falling assets?