Callan Table of Periodic Investments - Monthly Update

[big-papa]

You forgot the theme "I'm so smart; here's yet another reference to a philosopher that you've never heard of."

My copy of "Skin In The Game" has a back cover Twitter blurb from "Dan in Prague:" "The problem with Taleb is not that he's an *******. He is an *******. The problem with Taleb is that he is right."

Bwahahahaha!!!!

Here's another review that points out the same issues but ultimately ends up with "dislike". My favorite quote:

"So he has gone for deliberate disorder: Antifragile jumps around from aphorism to anecdote to technical analysis, interspersed with a certain amount of hectoring encouragement to the reader to keep up. The aim, apparently, is to show how much more interesting an argument can be if it resists being pinned down."


https://www.businessinsider.com/review-antifragile-by-nassim-taleb-2012-11

 

[kevink]

I've been fascinated by their quilt for years. It's a nice graphical representation to show how random the ordering of "winners" is each year. For those initially pondering their AA, especially those who care about short-term volatility, it's a powerful visual. For those who believe " nobody knows nuthin' " and therefore hold something like the Total Market, it provides some confirmation.

For some, however, the ordering isn't as important as the magnitude. That data is there in the quilt, but the visual picture painted is more about the ordering than it is about the magnitudes of returns. For those who can tolerate more short term volatility but who want to try and do more to maximize their long term returns, you'll get more information by using something like Portfoliovisualizer or Simba's spreadsheet.

Still, others have created alternatives to the Callan Quilt, such as this one on seeking-alpha which also graphically shows the magnitudes as well as the ordering. Scroll down a bit on the page and it's there. Definitely not as easy to read as the ordering-only Callan version, but the information is there.
https://seekingalpha.com/article/4057532-alternative-callan-periodic-table-of-investment-returns

Here's another one that tries to do the same thing:
https://www.investmentaccountmanager.com/products/a-new-periodic-table-of-performance/

There are many roads to Dublin and there is no one-size-fits-all asset allocation. I'm a big backtester, but there are limits to its usefulness. There will never be enough data to ever find the "best" portfolio by looking backwards. So you're left with what is likely a decent range of choices, but with a heavy dose of philosophy on top of it to choose your path. For some, that philosophy leads them to a Jack Bogle style buy the whole market portfolio. For others, it could be any combination of US or International Stock, factors, non-traditional assets such as Gold and/or commodities, factors, real estate, etc. In the end, the only thing that matters is whether you're meeting your goals, not whether you've optimized with limited data and not whether you're following somebody else's idea of a great portfolio.

For some, however, the ordering isn't as important as the magnitude. That data is there in the quilt, but the visual picture painted is more about the ordering than it is about the magnitudes of returns.

That's why while I agree the Callan table is entertaining to look at it doesn't offer anything actionable in choosing a portfolio beyond the obvious message of diversifying across asset classes ("owning the casino" as someone put it in this thread).

I find the Portfolio Charts to be the single most useful site in looking at actual returns over every market cycle of a range of portfolios, and for testing possible allocations. You see real returns over every market cycle using Simba's data, deepest and longest drawdowns and time to recovery ("the Ulcer index"), start date sensitivity and maximum safe and perpetual withdrawal rates. The cumulative effect of the great graphics and tools is to provide an almost visceral sense of what it would be like to actually live with a given portfolio through all kinds of market conditions.

https://portfoliocharts.com/portfolios/

 

[Koolau]

You forgot the theme "I'm so smart; here's yet another reference to a philosopher that you've never heard of."

My copy of "Skin In The Game" has a back cover Twitter blurb from "Dan in Prague:" "The problem with Taleb is not that he's an *******. He is an *******. The problem with Taleb is that he is right."

High praise, indeed.

 

[Out-to-Lunch]

I've read it. In my opinion, the whole thing could have been summarized in about 3 pages but you won't make money on book sales that way.

Otherwise, it's a slog by Taleb through themes that repeat themselves throughout the book.
1. Me, me, me, me, me...
2. Anecdotal story that isn't quite relevant to my life.
3. Goto #1

You forgot the theme "I'm so smart; here's yet another reference to a philosopher that you've never heard of."

But seriously, I have never heard such an apt, pithy review of this book as just offered by OS and Big Papa. You both just put your finger on my take on the book.

 

[OldShooter]

Well, just to be clear on my part, I think Taleb is a little like a Christmas present in ugly and difficult to open wrapping. The ideas inside are well worth putting up with the wrapping. I have most of his books in my library and have reread most of them multiple times.

Speaking of my library, I have somehow ended up with two copies of "Fooled by Randomness." Anyone who would like one of them, PM me your address. First PM wins.

 

[big-papa]

Well, just to be clear on my part, I think Taleb is a little like a Christmas present in ugly and difficult to open wrapping. The ideas inside are well worth putting up with the wrapping. I have most of his books in my library and have reread most of them multiple times.

Speaking of my library, I have somehow ended up with two copies of "Fooled by Randomness." Anyone who would like one of them, PM me your address. First PM wins.

Similar here - Every toy I got for Christmas as a kid, I took apart. Often times the guts were more interesting than the whole-of-the-toy. Same with Taleb's writings. Glad, though, that I never bought the books and, instead, just borrowed them from the library. As I noted earlier, his ideas are interesting, but could easily be compacted into just a few pages.

Time to go to the gym and do 1 single dead-lift and call it a day (If you're read Anti-Fragile, you'll know what I'm talking about).

No, I'm not really going to do that.

Cheers
Big-Papa

 

[target2019]

The table below ranks the best to worst investment returns by asset class over the past 15 years. Hover over the table to highlight the asset class returns.

https://novelinvestor.com/asset-class-returns/

The chart has a nice access feature as you hover and point to an asset class. Nothing new or revolutionary, just more accessible I think.

 

[jazz4cash]

Oops...I missed this thread and started another with the Official chart from Callan.