In this episode of “What’s the Risk?” we take a look at something we get many requests for: how a diversified geared portfolio performs, something akin to Betashares GHHF.
There are many limitations in trying to recreate something similar to GHHF over a long period of time with any accuracy, so we’ve tried to offer something that at least gives investors some history of how a similar asset allocation, consistently geared at 1.5x, would have performed since the mid 90’s.
What we do find is something that doesn’t show many surprises in how it performs. At various periods it will be better and worse, which is simply magnified by the gearing. For comparison, we’ve used the indices VAS/VGS track on a 30/70 split and added in another portfolio construction with hedging to better compare to the diversified all growth geared portfolio construction.
We hope this sheds a little bit of light on the portfolio, but just remember there are many other things that will add and subtract to the performance of a similar ETF in real life.
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