Permanent Portfolio (Browne) vs 100% Global Equities
This is the widest gap in temperament of any pair on the site. One portfolio holds only shares and accepts whatever comes. The other splits evenly between shares, long bonds, gold and cash, and expects to give up return in exchange for never being badly hurt. What makes the comparison worth running is that the forward-looking view and the historical record do not agree about which approach won.
Set both to the same 16.8% volatility and 100% Global Equities comes out ahead, returning 7.00% against Permanent Portfolio (Browne)'s 6.94%, a gap of 0.06 percentage points a year.
These two views disagree: the forward-looking assumptions favour 100% Global Equities, while the record since September 2000 favours Permanent Portfolio (Browne). That is worth more than either number on its own. The historical figure is one path through one set of decades, and this window contains two equity bear markets and a long gold bull run. The forward-looking figure starts from today's valuations and yields, which is the situation you are actually investing from.
Side by side
| At its own risk level | Permanent Portfolio (Browne) | 100% Global Equities |
|---|---|---|
| Expected return | 4.90% | 7.00% |
| Volatility | 6.54% | 16.78% |
| Sharpe ratio | 0.28 | 0.23 |
Forward-looking estimates over a long horizon, not a measurement of any past period. Built from J.P. Morgan’s 2026 Long-Term Capital Market Assumptions, annualised and compounded, with a 3.10% risk-free rate.
The same comparison at matched risk
The table above compares two portfolios that take different amounts of risk, so part of any gap is just that. Below, the quieter portfolio is levered until both sit at 16.78% volatility. Exposure above one hundred percent is financed at cash plus 0.50 percentage points; anything under it earns the cash rate.
| Both at 16.78% volatility | Exposure | Expected return |
|---|---|---|
| Permanent Portfolio (Browne) | 257% | 6.94% |
| 100% Global Equities | 100% | 7.00% |
Leverage is applied to the whole portfolio and assumes it can be financed at the stated rate, which is closer to true for a futures-based implementation than for a margin account. It does not model the path, and a levered portfolio can be forced to sell at exactly the wrong moment.
What actually happened
Everything above is an expectation. This is the record. The window starts in September 2000 because that is the first month in which every asset class in both portfolios has data, and it runs to July 2026, which is 311 months. It is not a chosen period; a pair holding private equity or inflation-linked bonds simply cannot start earlier than those markets can be measured.
| September 2000 to July 2026 | Permanent Portfolio (Browne) | 100% Global Equities |
|---|---|---|
| Annualised return | 6.32% | 6.97% |
| Volatility | 5.95% | 15.77% |
| Sharpe ratio | 0.54 | 0.25 |
| Worst drawdown | -9.59% | -55.00% |
Rebalanced annually, with no fees or trading costs applied, so the figures compare the allocations rather than an implementation of them. Series are index and fund total returns, extended backwards before each ETF existed by the longer-running instrument tracking the same exposure.
The record at matched risk
| Both at 15.77% volatility | Exposure | Annualised return |
|---|---|---|
| Permanent Portfolio (Browne) | 265% | 10.00% |
| 100% Global Equities | 100% | 6.97% |
One window is one path. A record covering 26 years contains a particular sequence of regimes, and a portfolio that happened to hold the right asset through them will look better than it deserves. Read this next to the forward-looking figures rather than instead of them. Borrowing is charged at the cash rate plus 0.50 percentage points, the same terms as the forward-looking table. Note the size of the exposure needed here. Holding a portfolio at more than twice its own value is a different proposition from the portfolio itself, and the arithmetic above assumes it can be financed and maintained without ever being closed out.
What each one holds
| Asset class | Permanent Portfolio (Browne) | 100% Global Equities |
|---|---|---|
| AC World Equity | 25% | 100% |
| US Intermediate Treasuries | 25% | — |
| Gold | 25% | — |
| Cash / Money Market | 25% | — |
Why history flatters the Permanent Portfolio here
The measurable window opens in 2000, which is close to the worst possible starting point for equities and close to the best for gold. Shares endured the dot-com collapse and then the financial crisis inside eight years, while gold began a long run from a low base.
A portfolio holding a quarter in gold and rebalancing annually harvested that repeatedly, selling into strength and buying back into the assets that had fallen. That is the mechanism doing the work, and it is a real effect rather than an artefact.
It is also not a forecast. Repeating that result requires another era in which gold outruns equities from a low starting valuation, and the forward-looking assumptions do not expect one.
The honest way to read the two answers
Take the historical figure as evidence that the structure works when equities have a bad couple of decades, which is a genuine and useful property.
Take the forward-looking figure as the better guide to what happens from here, because it starts from today's valuations and yields rather than from those of 2000.
Frequently asked questions
Has the Permanent Portfolio beaten the stock market?
Over the window that can be measured with consistent data, and after adjusting both to the same level of risk, it did. That window begins near an equity peak and near a gold trough, which explains a great deal of the result and is why the forward-looking comparison reaches a different conclusion.
Is the Permanent Portfolio too conservative?
Its raw return is lower because its risk is much lower, so judging it on return alone misreads it. The question is whether its efficiency survives being levered up to a level of risk you would actually want to hold.