Post #677 by Mark19 on the Mechanical Investing board

Investment Strategies / Mechanical Investing

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I was unclear what I meant by beating the market. I meant beating the market with the amount invested in stocks. I think I learned a number of helpful things from this conversation. I agree that basing your mix based on the cape ratio rather than what the market does is a better method. Also, my portfolio is a decent size. If I live very frugally, I could probably retire. I am not sure where this formula comes from. You would then use (100/35*(CAPE-5))% bonds, (100 - 100/35*(CAPE-5))% stocks. Perhaps you can explain it. Also, Jim makes a good point that tips are not really the same as bonds. Tips funds are, but a tips ladder is different than bonds. I will need to research that.

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