Walker Fire had quite the week. First was a medical call Saturday night 6/14, a wildland fire on Father's day, a multiple vehicle fire that also took out a couple of sheds and caused a small ground fire on Tuesday and then on the holiday we had a call for an ATV accident that turned into a low level technical rescue because the patient was a long way down a hill very close to a wash.
On our Sunday morning hike today, we saw a very large horny toad for the first time in several years. We've only seen very small ones lately.
Morningstar had an article titled How Does Your 60/40 Portfolio Allocation Compare With The Pros? and included the following consensus mix.
I wouldn't say I am particularly contrarian but I do think of myself as knowing when to be orthogonal to the consensus as we've looked at in countless other posts.
I think it is important for a portfolio to differentiate and of course the consensus does not...by definition.
Sorry but there is nothing robust about consensus-type bonds funds. Jon Davi from Astoria was quoted in this article at Bloomberg via Yahoo that portfolios are "meant to survive uncertainty, not predict it” which very concisely sums up what we talk about constantly.
At fire training on Saturday, another firefighter asked me what I thought would happen with markets if the thing with Iran escalated (then of course it did escalate). I gave a very wishy washy answer because I don't know. MLK Day 1991 is an example of markets skyrocketing when the bombs dropped after a long buildup to that day that saw stocks go down. Another firefighter chipped in that 1991 was before he was born.
My thing is to have exposure to a few things that will probably go up if stocks go down a lot. It makes the most sense to me as a way to avoid the full brunt of large declines. As I type this, Yahoo shows very little reaction to the Iran news, great from a markets perspective if that is correct but I don't care about predicting what the market will do as opposed to being ready in case there is some sort of serious decline that accompanies this event.
If it is bad, then we know that the decline would end at some point and then the market would start going back up and eventually making a new high. The only variable would be how long that would take.
The information, analysis and opinions expressed herein reflect our judgment and opinions as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities or investment advice or a recommended course of action in any given situation.
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