Finding the Best Investment Portfolio To Invest In
When it comes to year-over-year returns, it's hard to beat Chris Cole's Dragon Portfolio. The Dragon portfolio was designed by Chris Cole of Artemis capital and can withstand anything the market can throw at it. But is it really the best investment portfolio?
The Dragon Portfolio really is one of the best. One big reason is that you can assemble and manage this portfolio yourself. There are a few moving parts, like long vol, and commodities trend following, that could pose a barrier to entry for new investors.
But long vol and commodities trend following can be taught and learned.
Median U.S. Pension System Portfolio
Before we dive into Chris Cole's Dragon Portfolio and how it can grow your wealth for decades to come, we better take a look at the typical portfolio allocation of your average US employee.
It doesn't take long to see why the fed is so desperate to keep markets propped up. If the financial economy crashes, it will wipe out these fragile, obsolete risk parity and 60/40 portfolio's that many employees are invested in.
The pie charts below show the typical portfolio structure that all the normies out there have, just like your friend and family member, Fred. It comprises of 73% stocks, 21% bonds, and 7% cash.
The Dragon Portfolio is much, much different than a boring old “Median US System Pension Portfolio”. Take a look.
Dragon Portfolio Allocations
The Dragon Portfolio consists of:
- 24% stocks.
- 18% bonds.
- 19% physical gold.
- 18% commodity trend following.
- 21% long volatility.
When we check out the charts…
Dragon Vs Buy The Dip – Who Did Better Over 90 Years Time?
Using the 60/40 as our investment portfolio of choice for this test, what would happen if we bought the dip every time the market corrected? How much money would we have after 90 years?
Dragon Portfolio Performance
If we started back in 1928 with $1 and maintained good dragon portfolio discipline for 100-years, then the dragon portfolio would have turned $1 into $100k.
If you look back to the section of the video where timeframes were discussed – in the recency bias and risk parity portfolio section – the dragon portfolio does exceptionally well regardless of whether or not we're in a serpent cycle or a hawk cycle.
To take it a step further, the hawk cycle can be inflationary or deflationary, the complete opposite of one another, and the dragon portfolio still crushes it.
Buy The Dip Performance
What would happen if you would have taken the advice of every single financial guru on YouTube and just bought the dip?
Whenever stocks go down, you are buying because you know the stock market always goes up over time. If you had started with a dollar in 1918, you'd have around 4 cents by 2018, and that doesn't even include inflation.
Excluding inflation, you still would have lost about 96%. Then, your friend and family member, Fred – who is telling you that you are wearing a tinfoil hat because you don't want to buy the dip – gets crushed.
While you the tin foil hatter, who dares to go against the grain and challenge the mainstream narrative does quite well and get rich.
Now, what I am sure you are saying to yourself is, “Yes, George, I'm a tin foil hatter. I agree. I'll raise my hand. I admit. I'm coming out of the closet, a tinfoil hatter.”
- But how do I set up this dragon portfolio?
- Or maybe even better yet, how do I set up a hawk portfolio?
Because I think the cycle of the serpent has come to an end…”