If you want your wealth to be readily available whenever you would like to access it, without having to wait (hope) for a market recovery, then you need a portfolio that minimizes the risk of significant drawdowns
WHAT IS AN ALL WEATHER PORTFOLIO?
Dynamic All-Weather Portfolios attempt to achieve positive returns regardless of the macroeconomic regime, such as positive or negative growth, or an inflationary or deflationary environment. This is achieved though a few key portfolio construction principles:
- Utilize multiple asset classes and strategies, beyond the traditional stock and bond positions
- Utilize both active (tactical) and passive exposures
- Recognize that some investments have a short volatility bias, and others have a long volatility bias, and it is critical that a portfolio contains both.