Each week in this section, Chief Investment Strategist Alexander Green responds to reader questions. It's your direct line to the Chief! Have a question for Alex? Drop him a line at mailbag@oxfordclub.com. Reader: I started the Gone Fishin' Portfolio two years ago in January 2022, and I am in the red on all funds. Down 10.4% in almost two years. How do you rebalance the portfolio when the entire portfolio is in the red? I don't have any winners in the green per se, just funds that lost less than the others. This would be a good question for a mailbag. I'm sure I'm not the only investor in this predicament who started this model allocation in the last two years. I'm not sure what to do here. - D.B. Alex: It's true that you had the bad luck of funding this portfolio at the very peak of the market. But the key is to rebalance annually, regardless of the performance of the assets in the portfolio. For example, rebalancing at the end of 2022 - meaning adding to underperforming stocks - would have set you up for a better 2023, when stocks bounced back more than bonds. The strategy here is to stay invested in all 10 asset classes and rebalance annually regardless of whether the funds are up, down or mixed. Doing that for the last 20 years would have allowed you to quadruple your original investment. If you're interested in accessing the Gone Fishin' Portfolio (as well as FOUR other model portfolios), go here for more information. |
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