Investment Strategy for Safe and Cost Effective
To protect against an uncertain future, your investment strategy must meet six requirements:
1. All the investments you own must defend yourself from bankruptcy in any economic climate, even should perform well.
2. Your strategy should not be linked to any outcome. Your financial security should not depend on any predictions, even if you are sure of your financial future vision.
3. Your investment plan should not undergo changes because trends change or anticipated stock macroeconomic problems. Any opinions about this are a forecast, which would lead us to the previous point.
4. Your investment program should be a wall against any financial surprises, including unexpected events like natural disasters or wars.
5. Your strategy should allow you to forget your investment portfolio until you have to deposit more money into it or touch rebalance.
6. If you have an opinion about the future, your strategy should allow you, if you make the bet with money you do not need nor with the money that belongs to your core portfolio investment.
Permanent Portfolio
This book responds to the premises described in the first five points. Any financial asset can meet the five together, but the right combination of assets has the power to do so.
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