An inevitable consequence of free markets and economies under the rule of law is the long-term growth of financial assets.
Therefore, the investment universe of the Austrian Strategy will be ‘buying the all free world’ —since we don’t know in advance which region/country of the world will be the most profitable in the future— through:
- 4 classic asset classes (with 5-years US bonds as safe-haven):
- Real Estate (REITs)
- Long-Term Government Bonds
- Globally invested. Gaining exposure to the main economic regions of the world through indexes of US, Europe and Emerging Markets.
The 4 classic asset classes are sufficient to cover any economic scenario –Growth, Inflation, Deflation, and Recession– across the business cycle, without overcomplicating (consequently not adding more hidden risks and operational difficulties) portfolio management.
Key point: There is always an asset class in the portfolio able to capitalize on any specific economic conditions:
Notice that due to its exposure to gold up to 25% (see here), this strategy is also a more prudent, diversified and less risky way to invest in gold.