i think i understand, atleast really trying to hahah.Here you go, first image is comparing an Equity (such as total world index) to an SMA
Second image is now instead of holding it in cash, you choose an asset class (bonds) that is inversely correlated to equity
and lastly third image is using dollar cost averaging for both. just $100
your drawdown is now far far more tolerable
15% drawdown and 15% average annual growth.
in a nutshell, Dalio forms the basis of asset classes, then simple timing makes it far far more effective.
You're basically saying that i need to find a bond ETF that holds about the same stocks as my Vanguard all-world ETF? To cancell each other out in bad/good times?
And if above statement i'm making is correct then i have to put my money (€100) in to the bond or equity that is decreased in price?