Though the way I remember the story, it was Bob Prince who had the spreadsheet and said "Hey Ray, look at this" regarding uncorrelated streams.
Ray Dalio breaks down his "Holy Grail" - This is what peak Dalio looks like
- Thread starter nooby_mcnoob
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Though the way I remember the story, it was Bob Prince who had the spreadsheet and said "Hey Ray, look at this" regarding uncorrelated streams.
He has a worldwide perspective. He will go to the ends of the earth to find the uncorrelated stuff.
Correlation increases greatly during meltdowns but there's always something that's uncorrelated. It doesn't have to be a simple instrument.
If I knew that, I wouldn't be jerking off with you guys here.
I agree 100% with him in principle. In practice, the difficulties lie in
1) I found it is really hard to quantify either return or risk in many cases
2) Low-correlation vehicle is really hard to find for individual investor/trader
With that being said, I think the idea is vital especially for the management of a huge fund/portfolio.
1) I found it is really hard to quantify either return or risk in many cases
2) Low-correlation vehicle is really hard to find for individual investor/trader
With that being said, I think the idea is vital especially for the management of a huge fund/portfolio.
Right! The trick is really in the details.
Any suggestion where I can look for low-correlation vehicles? In the past, I thought real estates (non REIT) and bond but since 2008-09 not so sure.