Karl's Permanent Portfolio Outpaces S&P and DOW by Almost 1,000% Since 2015
See the 2024 performance update and why buy-and-hold prevails.
It is that time of year again for the annual update to my “permanent portfolio” to see how it’s doing. The portfolio originally made its public debut on August 21, 2015, on my WordPress blog, which you can see here (along with updates): https://karldickey.wordpress.com/karl-dickey-investment-portfolio/
DISCLAIMER: The material provided on this website should be used for informational purposes only and in no way should be relied upon for financial advice. Please be sure to consult your own financial advisor when making decisions regarding your financial management. This portfolio is not necessarily Karl Dickey’s portfolio.
I moved it to Substack; you can see the 2023 update here. As you can see below, the portfolio continues to do well this past year, far outpacing the S&P and the DOW, thanks to the original small investment in Bitcoin, NVR, the Gold Trust (IAU), and Berkshire Hathaway. While the DOW and S&P have risen 150% and 186% over the last nine years, the permanent portfolio is up 939%. The worst performers in the portfolio have been with LQD and Vanguard mutual fund VGRLX. So, whether you started with $1,000, $10,000, or more, you are shy of 10X in 9 years, without worrying or trading — buy it and forget it.
Again, this is a static, permanent portfolio to show what can happen without any trading or periodic rebalancing and using the buy-and-hold strategy on what I feel are quality assets. I will not entertain questions that can be answered by returning to this portfolio's original thoughts and setup because it is very involved, so if you have questions, go there first. The concept of a permanent portfolio is just that, and I gathered these concepts by learning from Harry Browne, Warren Buffett, etc. (again, go to the link for more details).
However, I will summarize the idea behind the portfolio below the updated chart. This portfolio will be bought in 2015 and forgotten for at least a decade. I look forward to seeing where it is this time in 2025.
AI Summary of the portfolio:
The permanent portfolio outlined on Karl Dickey's WordPress site emphasizes a balanced approach to investing, designed to perform well in various economic conditions. This strategy is rooted in the belief that the economy cycles through different phases—prosperity, inflation, deflation, and recession—each favoring different asset classes. To protect and grow wealth regardless of the economic environment, the portfolio is diversified across four primary asset categories: stocks, bonds, gold, and cash. Though it contains a few “esoteric” assets, such as Bitcoin, Karl has advocated holding a small amount since at least 2012.
Stocks are included to capture growth during prosperous times; bonds provide stability and income during deflationary periods; gold offers protection against inflation, and cash acts as a buffer during recessions. The portfolio aims to reduce risk and provide steady, long-term returns by maintaining equal allocations to these assets and regularly rebalancing. This conservative yet resilient approach reflects a commitment to financial security and the understanding that no single asset class can consistently outperform in every economic scenario.