Does 80/20 or 90/10 have higher CAGR than 100/0?
I always see efficiency curves showing that 80-20 or thereabouts is the most efficient place for a stock bond split, such that any more than 80% stocks is not compensated by the extra risk. If standard deviation of returns is not an issue, and risk is not an issue, and the timeline is long enough, does it still make sense to use 80/20 or 90/10 rather than 100% stocks? My specific application is within a certain state sponsored retirement account where I keep 100% international stock fund due to the 0.02% ER of the state-subsidized fund. That fits within my AA of all my other accounts such that it being in 100% stocks is NOT too risky in the grand scheme of my portfolio. The concept of this post applies here such that it might make sense to throw 5% to 20% MMF or Total Bond Fund into that specific account if it makes sense to do so. Then I could just calculate that small portion of bonds/cash into the overall AA and reduce the holdings of those things appropriately from my other account
