In the 1970s, Harry Browne popularized a strategy he called the Permanent Portfolio that he hoped would survive any calamity by addressing 4 issues:
- Take advantage of prosperity by investing in stocks
- Protect your portfolio from inflation by investing in gold
- Protect your portfolio from recession with long-term bonds
- Protect your portfolio from depression with cash or a cash equivalent
Below was his portfolio allocation:
- 25% Stock Index Fund
- 25% Gold Fund
- 25% Long-Term Bond Fund
- 25% Money Market Fund
From 1972 through 2008, this portfolio offered a more stable and slightly better return than an all-stock portfolio, 9.7% vs. 9.2%. This included re-balancing the portfolio components back to 25% once a year. But like any strategy, the permanent portfolio goes in and out of favor as the components move up and down. Other investors have adjusted it with other fund additions for fine tuning. Some of these include holding some assets in a basket of foreign currencies, natural resources, and real estate. There are funds that follow this permanent portfolio strategy and do the work for you and there are many modifications you can find online to the basic portfolio.
If you are interested in exploring the idea you can find books written on the subject as well as many Harry Browne publications on investing and libertarianism.