I’m just out of a session of trying to theory-build a permanent portfolio for the part of my money that I may need on the shorter term. My conclusion is that we have crises, nowadays, where all assets can drop simultaneously that make that impractical if the purpose is for that money to be there when it’s needed (there’s something to be said about it if the purpose is to fit your risk tolerance).
If your risk tolerance is less than 100% in stocks, I’d follow an allocation that reflects that. As I have a low net worth, a high human capital, no dependents and a good apetite for risk, I’m keeping in cash the money I plan to use in the short term (emergency fund, opportunity fund and savings for a downpayment on a house in less than 2 years) and have the rest invested 100% in stocks. Given the relative size of my second pillar and farmlands in regards to my total net worth, that still places me at a conservative allocation.
I’d be more conservative with my liquid investable money if I had more to loose (more accumulated wealth, dependants or closer to retirement).
As a wise man once said: “making predictions is tough, especially about the future.” As @ProvidentRetriever states, it’s good to have a strategy that we can follow as much through good as through hard times and to just stick to it.
Edit: just in case that was part of the question, the permanent portfolio I’ve landed on was pretty close to the Golden Butterfly, with CHF as short term bonds and all world stocks rather than US centric.