Permanent Portfolio-type fund in UK?

saveonarola

Does anyone know if there's a UK unit trust or similar type of fund that operates on Harry Browne/Permanent Portfolio principles?

I'm aware that you can assemble an equivalent portfolio with index trackers and etfs, but I'm just wondering.

jon3001

I'm not aware of such a fund.

I hadn't come across this portfolio before. It looks interesting - based on rebalancing an allocation of uncorrelated assets. That's the basic principle I'm applying to my own portfolio investing.

William Berstein analysed it and came to the conclusion that all its components were indeed uncorrelated:
http://www.efficientfrontier.com/ef/0adhoc/harry.htm

The original portfolio is an old idea and you might well be able to implement the principle in a superior manner today. There are funds supporting diversified commodity futures (I prefer these to a single commodity such as gold) and property. Either of these could do well when stock markets tank.

For futher reading I recommend:
"Asset Allocation", Roger Gibson

saveonarola

Thanks Jon3001. I came across the Permanent Portfolio here:

http://monevator.com/2010/10/19/9-lazy-portfolios-for-uk-passive-investors-2010/

I had read the very interesting William Bernstein article you link to, which describes a US fund that mimics this portfolio, which is why I was wondering whether there was a UK version.

dunstonh

I hadnt heard of him but a very quick read suggests that he uses modern portfolio theory with sector/asset allocation and rebalancing. In which case, that is one of the most popular methods of portfolio building and running that IFAs use. The major difference being the 25% allocation to gold (typically IFAs would use cash, bonds and stocks but have an allocation under stocks for specialist investments which would include gold, commodities etc).

So, it is a variation on the Modern Portfolio Theory (MPT)