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We have been discussing and INVESTING in ALT funds for many months now on other sites. QLENX beat the SP500 for 3-5 years. see chart(https://schrts.co/TfnpDjua). In 2026 it's not doing well, and we mentioned ORR(https://militiaetf.com/) and JAKRX as good replacements.
PRPFX is one of the few alt funds that has endured. A classic.
There are newer offerings as we look to offset potential volatility. I started adding BRGOX last year. HEDG is a new etf of a mutual fund with an ok track record. Own a few shares of ORR.
Some alts can be used as bond alternatives - to generate 5% -6% returns with lower volatility. ARBIX/ARBOX, HMEZX, BALT, etc.
You pay higher fees for the "privilege", but its another potential means to a desired end.
Here is something I posted in August of 2025 which is still quite relevant today:
"With the market at an all time high, and generally considered to be overvalued, I bought additional shares in QDSNX, an alternative fund with an excellent risk/reward profile which has worked very well for me so far. It never had a losing calendar year since its inception in July 2020. Even in 2022, a year of significant losses for most funds, the fund's total return was a gain of 14.5%. The max. drawdown over the life of the fund was 4.55%, that was from June to July of 2022. The drawdown was recovered by November 2022, according to Portfolio Visualizer. By the way, QDSNX's correlation to the S&P 500 is 0.12."
In addition, below is a quick snapshot of AQR Diversifying Strategies (QDSNX) published by David Snowball also in August of 2025:
"What it does: Allocates to six AQR alternative mutual funds (Managed Futures Strategy, Equity Market Neutral) and seeks to add additional value over time through tactical positioning
Why you might be interested: It has a 0.01 correlation with the S&P 500. That translates to, “nothing that happens in the S&P 500 predicts what this fund will do.” S&P soars, fund shrugs. S&P crashes, fund shrugs. Five-year annual return 12.0%, MFO Great Owl and Morningstar five-star rating. Remarkably low expenses, at 0.44%.
Why you might hesitate: Well, it does kind of layer complexity on top of complexity since the underlying funds are all financial engineering vehicles. And it does have $4.1 billion in AUM already."
Probably not too many Alt fans here at MFO, but I use some of these funds. AQR funds are becoming popular due to recent track record.
Maybe not. "Old dogs, new tricks" may apply. But, I suspect that there are more than a few who have the means to consider such vehicles.
And this: "Amin doesn’t like PE’s move downstream. “We have concerns about these products that are being created specifically for the mass-affluent market,” he says. Given that there’s less information available about private companies compared with public ones, he worries about “the quality of the underlying assets” in newer funds. “A lot of these vehicles haven’t been tested across different market cycles,” Amin says.
PRPFX is one of the few alt funds that has endured. A classic.
There are newer offerings as we look to offset potential volatility. I started adding BRGOX last year. HEDG is a new etf of a mutual fund with an ok track record. Own a few shares of ORR.
Some alts can be used as bond alternatives - to generate 5% -6% returns with lower volatility. ARBIX/ARBOX, HMEZX, BALT, etc.
You pay higher fees for the "privilege", but its another potential means to a desired end.
All worth taking a look. I am curious about some additional defensive options.
That link deserves its own thread. There is a lot to discuss/unpack there. Admittedly, I am biased to this POV, as I have been seeing/saying same for over a year. But, there are some very stark facts in there.
•Foreign investment in U.S. stock dropped 63% in the first quarter of 2025, compared with the fourth quarter of 2024, according to the Bureau of Economic analysis.
•The New York Fed’s latest data shows a steady decline in the amount of Treasuries and other U.S. securities held on behalf of foreign central banks.
•The U.S. dollar index, which measures the greenback’s value against a basket of foreign currencies, has fallen about 10% the past 12 months.
•The erratic U.S. trade behavior in the U.S. has come to roost in its markets. So far this year international stocks have whomped U.S, stocks. The Standard and Poor’s 500 stock index, for example, is up 1.5% so far this year. Over the same period, overseas stock markets have jumped 8.6%
More on the previous post regarding @davidmoran link, they suggest this "simple new portfolio":
5% in gold, via GLD, an EFT that holds physical gold 50% in VT, an ETF that invests in stocks all around the world, including the U.S. It has about 62.5% in U.S. stocks. 30% in BND, a widely diversified bond ETF 15% in a money market mutual fund
"it is a lower allocation to U.S. stocks than is typically recommended, and higher in money market funds than is typically recommended."
I have been heading in a similar direction for a while. From posts that I have read, others here have too. Building cash, foreign, PM...
Another newer play, ALLW, from Ray Dalio is marketed as a somewhat defensive option that mixes broad commodities and gold, global bonds and equities with inflation linked bonds. Leveraged.
Supposedly an all-weather portfolio.
I do own QDSNX that @fred495 mentioned and appreciate the FOF approach.
More on the previous post regarding @davidmoran link, they suggest this "simple new portfolio":
5% in gold, via GLD, an EFT that holds physical gold 50% in VT, an ETF that invests in stocks all around the world, including the U.S. It has about 62.5% in U.S. stocks. 30% in BND, a widely diversified bond ETF 15% in a money market mutual fund
"it is a lower allocation to U.S. stocks than is typically recommended, and higher in money market funds than is typically recommended."
I have been heading in a similar direction for a while. From posts that I have read, others here have too. Building cash, foreign, PM...
The portfolio seem to me to be a very strange reaction to the problems described by Waggoner. To begin with: Why would anyone besides a Boglehead planning to live forever want a 30 % position in a bond index fund massively tilted to US debt with a duration at 5.72?
I think the same problem applies to VT where you would be well behind the curve of adjusting to the problems identified by Waggoner.
And who should be in a portfolio that is only 50% equity?
Thanks, JD, for bringing Ray Dalio's All Weather ETF (ALLW) to my attention. Below is a brief excerpt from a recent review of this fairly new fund by Tony Dong of ETF Portfolio Blueprint:
"Ray Dalio's ALLW is one of the few risk parity ETFs available, and in my view, the most thoughtfully constructed. Risk parity starts from a different premise than traditional portfolio construction. Instead of allocating capital based on expected returns, assets are sized based on how much risk they contribute to the portfolio.
To put that into context, consider a traditional 60/40 stock and bond portfolio. While it sounds balanced, the risk profile is anything but. Equities typically account for more than 90% of the portfolio’s volatility, with bonds contributing the remaining 10% or so.
If you wanted to equalize risk using only stocks and bonds, the portfolio would look more like 20% equities and 80% bonds. That structure can deliver strong risk-adjusted returns, but total returns tend to be muted because bonds are not strong growth engines.
Risk parity addresses that by expanding the opportunity set. Additional uncorrelated assets, such as commodities are introduced, and modest leverage is applied at the portfolio level.
The goal is to scale an already efficient risk profile up to a more attractive return target without concentrating risk in any single asset class. That is exactly what ALLW is designed to do.
As of December 31, 2025, the portfolio illustrates this framework clearly. Nominal government bonds make up 73.1% of the allocation. Equities account for 43.6%, commodities represent 34%, and inflation-linked bonds make up 36.5%.
These allocations add up to well over 100%, which reflects the use of leverage. That leverage is implemented primarily through futures and swaps.
The choice of these four asset classes is deliberate. The All Weather framework is designed to hold up across what Dalio describes as the major economic environments: periods of rising growth, falling growth, rising inflation, and falling inflation.
Despite its short track record, early results have been encouraging. From March 6, 2025 through January 30, 2026, ALLW delivered a higher risk-adjusted return (Sharpe ratio) than both a global 60/40 portfolio and a global all-equity portfolio."
@WABC. You ask, “who should be in a portfolio that is only 50% equity? “. Me for one. Lots of older folks, people who have won the game, folks who are primarily interested in the preservation of capital,, lots of people for lots of reasons.
@WABAC, we have been reducing equity risk as we are approach retirement. In light of the stock market valuation and the over-hyped AI, we say no thank. Since you asked, we at low 40% stocks, and the rest are boring bonds, and money market.
@WABAC, we have been reducing equity risk as we are approach retirement. In light of the stock market valuation and the over-hyped AI, we say no thank. Since you asked, we at low 40% stocks, and the rest are boring bonds, and money market.
@Sven, my question was a rhetorical one in response to Waggoner's suggested portfolio. In his piece Wagoner did not specify who his portfolio was aimed at. From your recent posts I am pretty sure you aren't relying on VT and BND to address the problems identified at the link posted by @davidrmoran.
@WABAC, you are correct again. I read davidmoran’s post and did not think much of Wagoners asset allocation plan. There may be good reasons as you pointed out that many better approaches than those described by Wagoners.
@WABAC, we have been reducing equity risk as we are approach retirement. In light of the stock market valuation and the over-hyped AI, we say no thank. Since you asked, we at low 40% stocks, and the rest are boring bonds, and money market.
@Sven, my question was a rhetorical one in response to Waggoner's suggested portfolio. In his piece Wagoner did not specify who his portfolio was aimed at. From your recent posts I am pretty sure you aren't relying on VT and BND to address the problems identified at the link posted by @davidrmoran.
Nor am I. But, Waggoner's general theme of less U.S. equity, more INTL equity, some PMs, more fixed income seems to be working well, at present. That can be adjusted to one's risk tolerance. In my case the FI is far more aggressive than BND. And my equity allocation is much higher. I do have some funds parked in something like BND for now. But that is a temporary situation, dictated by 401K limitations. I can only have 50% of my 401K in the self-directed brokerage area. And I sold some mutual funds in the standard side, not too long ago. Waiting on a better opportunity (soon?) to buy back equity. BND seems like a better place than the MMF, for now.
I can only have 50% of my 401K in the self-directed brokerage area. And I sold some mutual funds in the standard side, not too long ago. Waiting on a better opportunity (soon?) to buy back equity. BND seems like a better place than the MMF, for now.
That's a bummer. So no access to any foreign bond funds at all?
@WABAC Not really, the FI choices on the traditional 401K side are very slim (MMF, short term, U.S. bond index, and "Bond Fund"). Having made a sale recently the "Bond Fund" was the best choice for short term parking. It does have an allocation to ~15% international. So, comparing it to BND is probably not totally appropriate.
I just use basic funds in that portion, and compensate elsewhere.
I never see this kind of followup or response because it's not my handle.
As for the name, Google AI sez: A reeve was a medieval official responsible for supervising tenants and maintaining law and order on behalf of a landowner.
I never see this kind of followup or response because it's not my handle.
As for the name, Google AI sez: A reeve was a medieval official responsible for supervising tenants and maintaining law and order on behalf of a landowner.
Oh, darn. I see that now! It is hard to spot with aging eyes. The "r" and "m" sort of meld together. The "r(eeves)" comment was oblique. I will try harder.
Is Reeves your middle name? Or just a jest(er)? As in a medieval comedian?
Funds which are long precious metals (gold, silver, etc.) are likely outperforming YTD. But perhaps a few of these hold shorts that are paying off as well, and many do invest globally.
Comments
QLENX beat the SP500 for 3-5 years. see chart(https://schrts.co/TfnpDjua).
In 2026 it's not doing well, and we mentioned ORR(https://militiaetf.com/) and JAKRX as good replacements.
Who is David Orr?
See performance and comments (https://militiacapital.com/) in contrast to years of BS from Marks.
Read an interview (https://ragingcapitalventures.com/provocative-long-short-investing/)
There are newer offerings as we look to offset potential volatility. I started adding BRGOX last year. HEDG is a new etf of a mutual fund with an ok track record. Own a few shares of ORR.
Some alts can be used as bond alternatives - to generate 5% -6% returns with lower volatility. ARBIX/ARBOX, HMEZX, BALT, etc.
You pay higher fees for the "privilege", but its another potential means to a desired end.
"With the market at an all time high, and generally considered to be overvalued, I bought additional shares in QDSNX, an alternative fund with an excellent risk/reward profile which has worked very well for me so far.
It never had a losing calendar year since its inception in July 2020. Even in 2022, a year of significant losses for most funds, the fund's total return was a gain of 14.5%. The max. drawdown over the life of the fund was 4.55%, that was from June to July of 2022. The drawdown was recovered by November 2022, according to Portfolio Visualizer.
By the way, QDSNX's correlation to the S&P 500 is 0.12."
In addition, below is a quick snapshot of AQR Diversifying Strategies (QDSNX) published by David Snowball also in August of 2025:
"What it does: Allocates to six AQR alternative mutual funds (Managed Futures Strategy, Equity Market Neutral) and seeks to add additional value over time through tactical positioning
Why you might be interested: It has a 0.01 correlation with the S&P 500. That translates to, “nothing that happens in the S&P 500 predicts what this fund will do.” S&P soars, fund shrugs. S&P crashes, fund shrugs. Five-year annual return 12.0%, MFO Great Owl and Morningstar five-star rating. Remarkably low expenses, at 0.44%.
Why you might hesitate: Well, it does kind of layer complexity on top of complexity since the underlying funds are all financial engineering vehicles. And it does have $4.1 billion in AUM already."
Good luck.
Thanks Fred! That is definitely something to look in to. A "fund of funds" approach.
Their year-by-year return is damn impressive. Maybe not. "Old dogs, new tricks" may apply. But, I suspect that there are more than a few who have the means to consider such vehicles.
And this: "Amin doesn’t like PE’s move downstream. “We have concerns about these products that are being created specifically for the mass-affluent market,” he says. Given that there’s less information available about private companies compared with public ones, he worries about “the quality of the underlying assets” in newer funds. “A lot of these vehicles haven’t been tested across different market cycles,” Amin says.
https://johnmwaggoner.wordpress.com/2026/02/16/the-world-turned-upside-down/
That link deserves its own thread. There is a lot to discuss/unpack there. Admittedly, I am biased to this POV, as I have been seeing/saying same for over a year. But, there are some very stark facts in there.
•Foreign investment in U.S. stock dropped 63% in the first quarter of 2025, compared with the fourth quarter of 2024, according to the Bureau of Economic analysis.
•The New York Fed’s latest data shows a steady decline in the amount of Treasuries and other U.S. securities held on behalf of foreign central banks.
•The U.S. dollar index, which measures the greenback’s value against a basket of foreign currencies, has fallen about 10% the past 12 months.
•The erratic U.S. trade behavior in the U.S. has come to roost in its markets. So far this year international stocks have whomped U.S, stocks. The Standard and Poor’s 500 stock index, for example, is up 1.5% so far this year. Over the same period, overseas stock markets have jumped 8.6%
5% in gold, via GLD, an EFT that holds physical gold
50% in VT, an ETF that invests in stocks all around the world, including the U.S. It has about 62.5% in U.S. stocks.
30% in BND, a widely diversified bond ETF
15% in a money market mutual fund
"it is a lower allocation to U.S. stocks than is typically recommended, and higher in money market funds than is typically recommended."
I have been heading in a similar direction for a while. From posts that I have read, others here have too. Building cash, foreign, PM...
Supposedly an all-weather portfolio.
I do own QDSNX that @fred495 mentioned and appreciate the FOF approach.
I think the same problem applies to VT where you would be well behind the curve of adjusting to the problems identified by Waggoner.
And who should be in a portfolio that is only 50% equity?
Waggoner is oddly underfollowed here and has been writing smartly and sensibly for decades.
(People, when you leave out the r[eeves], which seems to happens like 90% of the time, I rarely see your comment or followup.)
"Ray Dalio's ALLW is one of the few risk parity ETFs available, and in my view, the most thoughtfully constructed. Risk parity starts from a different premise than traditional portfolio construction. Instead of allocating capital based on expected returns, assets are sized based on how much risk they contribute to the portfolio.
To put that into context, consider a traditional 60/40 stock and bond portfolio. While it sounds balanced, the risk profile is anything but. Equities typically account for more than 90% of the portfolio’s volatility, with bonds contributing the remaining 10% or so.
If you wanted to equalize risk using only stocks and bonds, the portfolio would look more like 20% equities and 80% bonds. That structure can deliver strong risk-adjusted returns, but total returns tend to be muted because bonds are not strong growth engines.
Risk parity addresses that by expanding the opportunity set. Additional uncorrelated assets, such as commodities are introduced, and modest leverage is applied at the portfolio level.
The goal is to scale an already efficient risk profile up to a more attractive return target without concentrating risk in any single asset class. That is exactly what ALLW is designed to do.
As of December 31, 2025, the portfolio illustrates this framework clearly. Nominal government bonds make up 73.1% of the allocation. Equities account for 43.6%, commodities represent 34%, and inflation-linked bonds make up 36.5%.
These allocations add up to well over 100%, which reflects the use of leverage. That leverage is implemented primarily through futures and swaps.
The choice of these four asset classes is deliberate. The All Weather framework is designed to hold up across what Dalio describes as the major economic environments: periods of rising growth, falling growth, rising inflation, and falling inflation.
Despite its short track record, early results have been encouraging. From March 6, 2025 through January 30, 2026, ALLW delivered a higher risk-adjusted return (Sharpe ratio) than both a global 60/40 portfolio and a global all-equity portfolio."
what tool do you use to see prwcx's history and return in GE ?
I just use basic funds in that portion, and compensate elsewhere.
February 21 Flag
@davidmoran
That link deserves its own thread. \\
I never see this kind of followup or response because it's not my handle.
As for the name, Google AI sez:
A reeve was a medieval official responsible for supervising tenants and maintaining law and order on behalf of a landowner.
"(People, when you leave out the r[eeves], which seems to happens like 90% of the time, I rarely see your comment or followup.)"
Oh, darn. I see that now! It is hard to spot with aging eyes. The "r" and "m" sort of meld together. The "r(eeves)" comment was oblique. I will try harder.
Is Reeves your middle name? Or just a jest(er)? As in a medieval comedian?
ALLW.................0.37%....................8.33%
BRGOX..............0.71........................8.06
JAKRX................0.06........................8.58
QDSNX.............0.00........................3.51
QLENX............-0.29......................-1.31
QQMNX........-0.31.........................1.14
QNZNX.........-0.29..........................7.92
compared to:
S&P 500........-1.01.........................0.08
A few more YTD returns:
PRPFX +9.4% YTD
ORR +13.4% YTD (45% Japan allocation)
HEDG +0.7% YTD