Was 2022 not bad enough for you?
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Hmm, you’re right! So I did actually experience a market crash. For a while, I had my money with a robo-advisor which diversified into different asset classes, and I didn’t check my portfolio that often. And the risk set with the robo-advisor was rather moderate. For the past two years, I’ve been 100% All World. The statement “I started investing after Corona” is correct, but the approach has changed over the last two years. I therefore believe that a market crash will have a different impact on my portfolio than it did in 2022 
On the other hand, what I often forget is my 3a, because I only open and deposit it once a year. I’ve actually been invested in 3a for quite some time (by my standards) and it never really bothered me when the 3a dipped a little. In other words: maybe I’m actually okay with market crashes. I don’t know
Perhaps it can be rephrased:
What I have not yet experienced is a bear market lasting several years.
everything since 2008 crash has been pretty minor.
covid very quickly recovered.
2022 wasn’t too deep and only took 2 years to recover
tariff crash was shallow and quick to recover.
let’s see when we get a 50%+ crash which grinds only downwards for at last 2 years. i think that is when investor patience is really tested. when every day the portfolio goes down more and you keep asking yourself “should I get out before it goes down even more”.
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The length is key.
The ulcer index measures this when backtesting.
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12 posts were merged into an existing topic: Monkey-brain ETFs: Dividend ETFs
Has anyone dipped into the Amundi 2x world ETF? I’ve been thinking to break half of my VWRL and stick it there, then build it back up while letting the 2x run. Haven’t done it yet because AUM seems low, fees are high (3x VWRL’s for 2x leverage) and it’s new.
There was a crash in 2022? I don‘t think so. That was normal volatility, no crash.
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I will have to invest the wife’s 2nd pillar money in a few years. I was thinking of a combination of QQQ and SCHD. Did some backtests and could almost not believe the results: 20% QQQ and 80% SCHD at a leverage of 110% with monthly rebalance did extremely well in risk-adjusted performance.
The risk was way lower than 50/50, even with the debt. The performance was better, even with the debt interest.
It was just a glance at a test site, cannot exactly remember which, but I still have a few years to do research.
Interesting, but yes, debt can actually help to reduce your risk when used correctly. 10% may not seem a lot but it helped dramatically to reduce the time to recover in bear markets.
People who were in bonds under the premise they were safe may have experienced a shock bigger than with bigger and more prolonged drawdowns in stocks.
I’d say the best teachings of 2022 were about bonds and duration matching.
Edit: of course, those who were 3x leveraged in stocks and 3x leveraged with US long term treasuries under the premise that the treasuries would dampen the volatility of the stocks by going up when stocks went down were in for quite a shock.
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The global stock market lost more than 20% over a period of 10 months or so. That fits the definition of a bear market. Nothing really unusual, though (the most unusual thing was probably that the bond market got a significant correction at the same time).
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I like the barbell aspect of QQQ+SCHD, they have essentially zero overlap, cover 200 US stocks, I love SCHD’s mechanical aspect, and believe any serious tech contender will want to be listed on the NASDAQ100 (there’s one tech stock conspicuously absent from it but I can’t recall which one right now).
I am sure you tested several rebalance timeframes. This year when we recovered from April’s dip, around early June, I broke my S&P500 ETF and put 2/3 in SCHD and 1/3 in TQQQ. I think I tested various rebalance timeframes (quarterly, biannually, annually, none) and saw that no or annual rebalance and application of the 200SMA+1/3% for TQQQ worked best. I appreciate it’s most likely overfitting given the last decade’s tech bull run. I feel monthly rebalance is a lot of churning (and Swiss broker fees!) for my liking.
Hedgefundie’s Excellent Adventure met an untimely demise in 2022 and still hasn’t recovered, doesn’t mean it hasn’t made serious money!
Edit: a few years back, before 2022, I was talking to my brother who’s far more technical and Ben Felixian than me about it, he said “Wait, what is that strategy called? Hedge-fundie?! It’s a stupid name, it will die, nothing with such a stupid name can survive!”
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Not only significant, the biggest bond bear market in history.
And we are still in it, Bonds (aggregate, swiss bonds are quite close) are still quite away from recovered (inflation adjusted) to that level yet.
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Questions still stands.