Dragon Portfolio

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effigy98
Posts: 63
Joined: Wed Sep 25, 2019 8:57 pm

Dragon Portfolio

Post by effigy98 »

The returns of this thing historically are even better then my other favorite portfolios but I am not sure how to set it up more passively.

How do you set this up with ETFS? Is there a good fund for trend commodities?

https://taylorpearson.me/thedragon/

My guess so far...
Gold: PHYS, AAAU, SGOL, etc
Equity/Bonds: NTSX, TLT
VOL: VIX
Trend Commodities: ???

Image
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David Jay
Posts: 9236
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Dragon Portfolio

Post by David Jay »

Did you start investing in 1928? If not, that graph has little value to you.

The two periods of significant over performance (where the slope of the Dragon portfolio is significantly steeper than the other lines) were 1933-1935 and 1971-1981. The first was the Great Depression and the second was soaring inflaton (mortgage interest rate was 14% when I wanted to buy my first home in 1980). If you were not invested during those periods the portfolio shows no real advantage over the four grouped lines.

Since 1981 a “Dragon” and a simple 60/40 are very similar. I vote for simplicity.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius
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tvubpwcisla
Posts: 523
Joined: Sat Nov 09, 2019 10:09 am

Re: Dragon Portfolio

Post by tvubpwcisla »

It is easy to make any portfolio look like the best one. Simply change the time frame. I recently read on the forum that bonds do better stocks and bonds are nothing more than a portfolio drag down. The reason they showed better is because the time frame was adjusted to a period where equities were down.
Stay invested my friends.
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Forester
Posts: 1510
Joined: Sat Jan 19, 2019 2:50 pm
Location: UK

Re: Dragon Portfolio

Post by Forester »

effigy98 wrote: Sun May 10, 2020 10:45 am The returns of this thing historically are even better then my other favorite portfolios but I am not sure how to set it up more passively.

How do you set this up with ETFS? Is there a good fund for trend commodities?

https://taylorpearson.me/thedragon/

My guess so far...
Gold: PHYS, AAAU, SGOL, etc
Equity/Bonds: NTSX, TLT
VOL: VIX
Trend Commodities: ???

Image
You could use $ROMO for trend. I'm sceptical about trend outside of equity index trend following.
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David Jay
Posts: 9236
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Dragon Portfolio

Post by David Jay »

Oh, and what’s with the “100 year” chart that is only 90 years long? They left out the stock bull market years of 1918-1927. Hmmm.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius
KSActuary
Posts: 611
Joined: Fri Jan 13, 2012 10:53 pm

Re: Dragon Portfolio

Post by KSActuary »

This is not a passive approach unless the definition of passive is oaying someone else to manage the various components.
Ferdinand2014
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Joined: Mon Dec 17, 2018 6:49 pm

Re: Dragon Portfolio

Post by Ferdinand2014 »

The fallacy of the optimal portfolio which is the evil cousin of the efficient frontier.
“You only find out who is swimming naked when the tide goes out.“ — Warren Buffett
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Forester
Posts: 1510
Joined: Sat Jan 19, 2019 2:50 pm
Location: UK

Re: Dragon Portfolio

Post by Forester »

60/40
vs 60 stocks 20 bonds 20 gold

This is already halfway to the Dragon Portfolio and is hardly outlandish. It can be held passively & cheaply.
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JoMoney
Posts: 9655
Joined: Tue Jul 23, 2013 5:31 am

Re: Dragon Portfolio

Post by JoMoney »

There aren't even decent passive commodity funds/portfolios... let alone ones that follow trend signals, let alone one that follows "good" trend signals.
It reminds of several managed funds I saw back in 2007-2008 trading Forex based on trend signals... none of which got anywhere near their advertised back-tested strategy results, appear to have completely collapsed during the financial crisis, and might not even be legal (or at least require a level of being an "accredited" investor to verify they're significantly wealthy and stupid enough to "invest" in such things).
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham
GaryA505
Posts: 660
Joined: Wed Feb 08, 2017 2:59 pm
Location: New Mexico

Re: Dragon Portfolio

Post by GaryA505 »

How about this?
20% VTI
20% TLT
20% IAU
20% PQTIX
20% TAIL
barneycat
Posts: 34
Joined: Tue Mar 06, 2018 8:38 pm

Re: Dragon Portfolio

Post by barneycat »

David Jay wrote: Sun May 10, 2020 12:08 pm Did you start investing in 1928? If not, that graph has little value to you.

The two periods of significant over performance (where the slope of the Dragon portfolio is significantly steeper than the other lines) were 1933-1935 and 1971-1981. The first was the Great Depression and the second was soaring inflaton (mortgage interest rate was 14% when I wanted to buy my first home in 1980). If you were not invested during those periods the portfolio shows no real advantage over the four grouped lines.

Since 1981 a “Dragon” and a simple 60/40 are very similar. I vote for simplicity.
Said it all.
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Forester
Posts: 1510
Joined: Sat Jan 19, 2019 2:50 pm
Location: UK

Re: Dragon Portfolio

Post by Forester »

GaryA505 wrote: Wed Aug 12, 2020 1:23 am How about this?
20% VTI
20% TLT
20% IAU
20% PQTIX
20% TAIL
I would avoid TAIL & PQTIX, too much drag.

40% VT
20% ROMO <trend
20% IAU
20% EDV
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