The Compound and Friends

Cullen Roche Drops by to Talk Perfect Portfolios

66 snips
Jan 26, 2026
Guest
Cullen Roche
Cullen Roche, founder of Discipline Funds and author of Your Perfect Portfolio, breaks down portfolio construction and popular strategies. He compares 60/40, risk parity, Buffett-style approaches and permanent portfolios. They explore diversification limits in crises, trend-following as a true diversifier, behavioral traps, and practical implementation tips.
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INSIGHT

Perfect Is The Enemy Of Good

  • Cullen warns that trying to perfect a portfolio often makes outcomes worse due to complexity and behavior.
  • He advises that "perfect is the enemy of the good" when designing investable portfolios.
ADVICE

Match Assets To Time Horizons

  • Think in time horizons when assessing diversification between stocks and bonds.
  • Adjust allocations if you need short-term low correlation, because 60/40 may not diversify across short horizons.
INSIGHT

All-Weather Has Tradeoffs

  • The permanent portfolio assigns instruments to economic seasons: growth, recession, deflation, and inflation.
  • That structure can feel diversified in stress years but sacrifices cashflow and may underperform long equity rallies.
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