Comment: Best Investment Plan was Created by a Libertarian

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Best Investment Plan was Created by a Libertarian

I have read a ton of books about investing and trading. I'm a day trader. I love the markets.

For most people who don't want to be bothered too much, the very best thing I've ever read as far as a solid investment method is concerned was developed by the late, great libertarian, Harry Browne. He was a philosopher, a writer, and an investment adviser.

The strategy is what he called the "Permanent Portfolio." The idea is to diversify assets among 4 classes: stocks, bonds, gold, and cash. The reason for these 4 is that the economy will move through various cycles, and one of these will likely do well in any cycle, except for recession (when it is a crap shoot as to what, if anything, might do well).

During economic boom, stocks flourish. During inflation, gold will rise. During a real deflation, bonds will rise. During recession, there is no correlation, but any of them might do well. Any can do will in any particular cycle, but these almost always work.

Since there is no way to consistently and accurately predict where the economy will go next, the idea is to be in each equally.

Rebalance the portfolio once per year (takes just a few minutes), and your "investment work" is done for the year.

This portfolio has averaged around 8% per year for 40 years (since gold prices have not been fixed by government). There have only been 3 or 4 losing years, and none have been bad (1%, 3%, 6%, and one other one maybe, that was very small loss).

For people who don't want to be bothered with investing, this is the best, most secure thing I've ever seen. For people like me who do want to outperform, just take some small percentage of total capital and swing for the fences with that.

Look up Harry Browne's books to find his investment method.

Best, simplest thing anyone has ever come up with, IMO.