Post #1778 by TGMark on the Mechanical Investing board

Investment Strategies / Mechanical Investing ❤

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After all, a smooth ride won't get you any higher standard of living the day you retire: only the portfolio balance matters. There is no point at all in seeking a low-volatility, low-drawdown, or low-stress portfolio

I would have to respectfully disagree in some cases.

There is an assumption that the high volatility/stress/drawdown portfolio leads to higher returns.
Even if that is true, one does not know that until the end.
Most of us humans feel the stress along the way if things are not going well.
That stress has a physiological cost, and also makes it more difficult to stick to a strategy.
So, I don't completely agree that only the endpoints matter, as the ride along the way cannot be dismissed lightly.

I guess there are those with iron stomachs for whom stress slides right off.
It would be nice to learn how they do that :)
(I'm pretty sure one way is to have enough assets that losing 50% of it doesn't affect anything).

Mark

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