#11. ZC: A Defensive Portfolio
Building a volatility resistant portfolio.
A couple of weeks ago my old man approached me for advice on how to invest some money he had inherited. Initially he wanted to put it into a savings account currently offering 2%. Although a reasonable idea, those rates are variable and with the ECB already cutting rates, these savings accounts will not return much over a 10 year period.
I told him I'll put something more mid-long term together.
In the meantime while at his local bank, he met with a financial advisor who genuinely offered my nearly 70 year old father, a high risk-stocks only product, where Nvidia was the highest weighted stock (its down 20% since). I had half a mind to pay the guy a visit to understand what mental institution he was residing in.
Anyway, I decided to think about what would best serve my dad and his goals and started to work on a portfolio.
I came up with Blue 626, a fund with the following core principles:
Diversification.
Capital Preservation.
Growth Potential.
My read on the market sets this portfolio up perfectly not just for someone in / approaching retirement but also as a hedge for market volatility, corrections and downtrends.
The portfolio contains a mixture of bond products, growth stocks, dividend stocks, metals and other etfs. The portfolios is by all means, recession resistant whilst also able to perform well in a bull market.
The portfolio isn't going to return triple digit returns over the next 10 years but it will provide a steady return whilst adhering to the key goal, preserving the investment.
I'm looking forward to seeing how this product performs over the next few years. I think the bonds will see immediate gains with the Fed looking to cut rates. Metals and Infrastructure should also perform well.
The stocks will be the longer term play, with a smaller allocation but higher return potential.
If you want a copy of the Blue626 prospectus, feel free to drop a message.