Put Ray Dalio's rule through your numbers

One rule JMM has located in a dated source, rebuilt as a working calculator, and taken a position on.

Sources located: Bridgewater Associates
Source years: 2012
JMM verdicts: depends on you

Portrait: Web Summit, CC BY 2.0, via Wikimedia Commons. Self-hosted by JMM.

All-Weather portfolio model

What does equal risk contribution look like in dollars?

depends on you Equal risk is a genuinely better question than equal dollars. Answering it needs leverage most people cannot get. Bridgewater Associates, 2012Open model

Not every rule here survives its own arithmetic

JMM does not grade this rule as a set. The verdict on all-weather portfolio model is where the position turns critical: Equal risk is a genuinely better question than equal dollars. Answering it needs leverage most people cannot get.

Each page separates three things people usually run together: what the source states, what JMM's model adds to make it computable, and where the rule itself breaks. The last one is not the calculator's limitations list. It is the failure of the idea, which is the part the person who published the rule has no reason to write down.