Is Harry Browne’s Permanent Portfolio suitable for the Chinese investment market?

My adapted version for the domestic (Chinese) market: 25% Gold ETF + 25% Deposits at the Big Four State-Owned Banks + 25% Central SOE Dividend ETF + 25% Government Bond ETF

Investment Notes: Harry Browne’s Portfolio (III) — Portfolio Construction and Maintenance

• These risk-mitigation strategies focus primarily on gold. • Tier 1: Fully allocate stocks, bonds, gold, and cash via mutual funds. – Convenient and straightforward to implement. – Carries relatively high risks associated with fund companies and fund managers. – The risk-resilience of the gold allocation is significantly weakened (e.g., paper gold / gold ETFs). • Tier 2: Allocate stocks, cash, and most of the gold via mutual funds; directly purchase bonds and a small amount of physical gold. – Eliminates fund-company and fund-manager risks at the bond level. – Moderately enhances the risk-resilience of the gold allocation. • Tier 3: Allocate stocks, cash, and a small portion of gold via mutual funds; directly purchase bonds and the majority of physical gold, storing it in diversified locations domestically. – Further strengthens the risk-resilience of the gold allocation. • Tier 4: Allocate stocks, cash, and a small portion of gold via mutual funds; directly purchase bonds and the majority of physical gold, storing it in diversified locations both domestically and internationally. – Achieves optimal risk-resilience for the gold allocation. 2. Diversify across fund companies and brokerage firms • To minimize fund-company and fund-manager risks, consciously distribute assets across multiple fund companies. Internationalization of the Permanent Portfolio • Generally, investors are advised to construct their Permanent Portfolio primarily within the country where they live and work (gold may be a slight exception). Risks of Foreign Asset Allocation • Different countries may be at different stages of the economic cycle. – If asset classes are allocated across multiple countries, the portfolio’s natural hedging effect may be lost. • Foreign investments face political risks: governments may selectively default on financial products held by foreign investors. • Currency risk: Purchasing assets denominated in foreign currencies exposes investors to exchange-rate fluctuations. II. How to Maintain the Portfolio Prioritize replenishing the cash pool with new capital • In cases involving regular inflows (e.g., salary income), adopt a strategy that prioritizes replenishing the cash pool first; rebalance only once the cash allocation reaches 35%. – Effectively amounts to buying assets at lower prices. – Strictly adhere to investment discipline—never chase gains or panic-sell. Prioritize withdrawals from the cash pool • For situations with little or no new capital inflow (e.g., retirement), withdraw first from the cash pool; rebalance only once the cash allocation falls to 15%. – Since stocks, bonds, and gold typically offer better return prospects than cash, it is preferable to preserve these positions for as long as possible. Rebalancing Strategy Why rebalance? • After initial portfolio construction, the original 25%-each allocation will inevitably drift due to differing asset price movements and new capital flowing into the cash pool. • Over-allocated assets: – Likely have appreciated in value; selling locks in gains. – Their oversized weight exposes the entire portfolio to disproportionate downside risk (beyond the intended 25%). • Under-allocated assets: – Likely have depreciated; buying represents opportunistic bottom-fishing. – Their undersized weight means even strong upward moves may fail to offset losses elsewhere. • Therefore, investors must proactively rebalance periodically to restore the equal 25% allocation across all four asset classes—a practice known as rebalancing. – Core logic: Buy low, sell high. – Objective 1: Generate additional returns—by selling appreciated assets and buying depreciated ones. – Objective 2: Manage risk—preventing any single asset class from becoming excessively dominant or negligible.

Norges Bank Makes New $44.20 Million Investment in H. B. Fuller Company

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Norges Bank initiated a new position in H.B. Fuller, acquiring 743,407 shares valued at approximately $44.2 million. The company recently reported Q1 earnings that slightly exceeded estimates and increased its quarterly dividend.

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