Performance & Risk Metrics (2016-2026)
| Metric | Permanent Portfolio | All Weather Portfolio |
|---|---|---|
| CAGR (10-Year Annualized Return) | 6.8% | 7.2% |
| Max Drawdown | -12.6% | -11.9% |
| Sharpe Ratio (Risk-Adjusted Return) | 0.57 | 0.60 |
| Volatility (Annualized StdDev) | 7.3% | 7.8% |
| Best Calendar Year | +15.2% | +16.8% |
| Worst Calendar Year | -5.8% | -6.2% |
| Strategy Type | Passive Portfolio (Strategic Buy & Hold) | Passive Portfolio (Strategic Buy & Hold) |
| Rebalancing Frequency | Annually (fixed target weights) | Annually (fixed target weights) |
Permanent Portfolio Philosophy
Harry Browne's Permanent Portfolio is built around four economic environments: prosperity (stocks), recession (cash), inflation (gold), deflation (long-term bonds). Each gets exactly 25%, creating a structurally balanced portfolio that is rebalanced annually.
All Weather Philosophy
Ray Dalio's All Weather Portfolio also targets all economic environments but uses risk parity principles to balance based on volatility. Bonds receive a much larger allocation (55%) because they are less volatile than stocks, which requires more capital to match their risk contribution.
Which Strategy is Right For You?
Choose GEM if: You are comfortable with monthly monitoring, invest via tax-advantaged accounts (like IRAs or 401ks in the US, or tax-wrapped accounts in Europe), and want to maximize long-term growth while protecting capital from major multi-year bear markets.
Choose 60/40 if: You prefer a hands-off, "set and forget" approach, have a taxable investment account where frequent turnover triggers capital gains tax, and can emotionally tolerate drawdowns of 20-30% without panic-selling.