Is Sortino index enough to contol my retirement etfs fortfolio?

We have come to focus more on constructing a portfolio that ensures the overall stability of the portfolio remains intact, even if certain SOXX SMH DRAM ETFs experience sharp declines similar to the drop in semiconductor stock prices.

Since there is limited historical data for the semiconductor ETF DRAM SOXX SMH, we do not know the specific patterns of decline or how long it took for the stock prices to recover during the 2000 dot-com bubble collapse and the 2008 subprime mortgage crash.

We anticipate that the memory market conditions and revenue growth of semiconductor companies, triggered by the AI ​​data center construction boom, will continue for several years.

The 7 trillion won invested in building AI data centers is larger in scale than the capital invested during the First Industrial Revolution, when the spinning machine was invented.

It is also larger than the investment made during the era of railroads, known as the Second Industrial Revolution, and even larger than the investment scale of the introduction of electricity, the Third Industrial Revolution.

In 10 years, we will enter an era where we no longer purchase goods from Amazon, but rather AI agents handle everything from purchasing items to organizing household belongings.

We remain optimistic about the long-term outlook for the industry. However, I believe that even if semiconductor-themed ETFs are added, they should be at a level that does not compromise the stability of the portfolio.

What methods are available for evaluating portfolio volatility?

The Sortino Index is an indicator that clearly shows how well a portfolio defends against a downturn.

Similarly, there is the Sharpe Ratio, which measures both gains and losses. The Sharpe Ratio rises whether the market goes up or down.

In my case, although I have resolved to invest for the long term (30 years), I experience potential psychological anxiety when facing a downturn. When my anxiety is high, I often get agitated without realizing it when I turn on my mobile trading system (MTS) to buy or sell, leading me to hastily buy or sell large quantities.

I research strategies to avoid situations that cause emotional agitation or depression as much as possible. A representative example is buying high-volatility assets such as QQQ, SMH, and QLD only after a double bottom has been formed on the weekly chart.

I have plotted the SORTINO Index using the past 30 years of data from the portfolio below. In a bull market, the Sortino ratio is higher than the Sharpe ratio. This implies that the Sortino ratio is useful for identifying bull markets.

I need to consider a new method for tuning my portfolio.

Reading the article below will be of great help in constructing a safe portfolio.

https://bomspring.com/how-to-limit-max-draw-down-mdd-15-for-retirement-portfolio/

How to limit max draw down (mdd) -15% for retirement portfolio - bomspring.com

With the weekend approaching, I would like to summarize how to limit and manage the maximum drawdown of aggressive assets within the monthly installment pension ... bomspring.com

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