Revisiting Bitcoin plus Harry Brown’s Permanent Portfolio – 2 Years later @ 40% profit

On January 2020 I posted a proposal for combining the Permanent Portfolio with a small 5% allocation to Bitcoin. The main argument was that by risking 5% of the portfolio we could almost double returns.

• What would happen if you took $5,000 out of your $100,000 permanent portfolio and allocated it to Bitcoin?
• From 3.6% annual to 15% annual returns?

Fast forward - 2 years later

Two years later I am revisiting the portfolio to see how it did. The rules were very simple and easy for anyone to reproduce. The so called BPP (Bitcoin Permanent Portfolio) allocated:

• 25% to SPY
• 25% to TLT
• 25% to GLD
• 5% to Bitcoin

Real test forward 2020-2022

The BPP returns from January 1 2020 until January 1 2022 are

Profit : 40.5%
Maximum Drawdown: 13.28%
Sharpe: 1.40

Equity assuming $100,000 starting capital

The traditional Permanent Portfolio for the same period:

Profit : 19.35%
Maximum Drawdown: 10.13%
Sharpe: 0.85

Conclusion

If you allocated just 5% of your Permanent Portfolio tp Bitcoin you would indeed double your returns while keeping a similar risk profile.