[shoover]

Sorry the examples are confusing. I mention periods of relative underperformance as a nod to your cherrypick comment: yes, the time frames matter in both directions. The question is how much the strategy goes up or down relative to the benchmark and for how long.

My claim with respect to this thread is that there is a strategy that outperforms in certain conditions like the 2008 selloff and 1970s inflation and does so without the risk of losing the gains as soon as the market turns around.

Relative to stocks or 60/40 during a bull market, it doesn't look so good, but it still generates positive returns, holding for some time any edge gained during the earlier conditions.

The overall result is a smooth climb, so I do claim it works well (enough) all the time. I don't claim absolute outperformance long term.

The best chart for what I'm trying to show is beneath the data table in [1]. And the Envy calculator at [2] has great data back to 1972 for different assets (and lets you change the start date).

[1] http://www.crawlingroad.com/blog/2008/12/22/permanent-portfo...

[2] http://portfoliocharts.com/calculators/