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Global vs just US
Old 09-20-2012, 04:27 PM   #1
Confused about dryer sheets
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Global vs just US

In Bob Clyatt's book, work less live more, he has 16 asset classes and i'm following that. however, he didnt make it clear the following:

1) he doesnt make it clear that you need Global (not just US exposure) for the classes:
-Hi Yld Bonds
-GNMA Bonds
-VC/Priv Equity

My gut tells me I should have something like 1/2 to 2/3 US and 1/2 to 1/3 Global for each of the classes above but the book is unclear.
Anyone know the answer?

2) For the International Bond Class, should we have some pctg in ST vs Med Term vs LT? I'm guessing a 10%/70%/20% guess but I would like to know what the author meant to have there?


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Old 09-20-2012, 05:03 PM   #2
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If you go to the link above, it shows the portfolio and a link that brings you back here to a discussion of his book.

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Old 09-20-2012, 06:46 PM   #3
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So are you saying your AA has 32 classes (16 x2 for US/International)? Seems like a lot.
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Old 09-20-2012, 06:59 PM   #4
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Originally Posted by photoguy View Post
So are you saying your AA has 32 classes (16 x2 for US/International)? Seems like a lot.
FYI, The Bob Clyatt (and his asset allocation model) believe that having many slivers of the financial market each weighted appropriately allows for bigger overall gains and bigger overall yearly income.

The devil is in deciding exactly how to allocate/weight (correctly) each sliver.

I am not convinced, but what do I know ? There are certainly those that indeed believe they can better allocate the market.

The Clyatt model is (in some ways) sort of the antithesis of the Bogle model.
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Old 09-25-2012, 09:02 PM   #5
Confused about dryer sheets
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Diversification is great but I would pay attention to portolio friction costs. For example to implement a 16 asset portfolio at $5/asset (i.e. ETF) that would $80. Depending upon how often you rebalance and the quality of your broker/dealer execution quality (i.e. bid/ask spread) and the cost of your ETFs the costs will substantially erode the long-term performance of your account if you have a limited amount of assets (i.e. capital) in your personal portfolio.
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