This episode is a follow-up to Episode 7 about our basic principles of risk-parity portfolio construction, which are: (1) the Holy Grail Principle; (2) the Macro-Allocation Principle; and (3) the Simplicity Principle.  Links:

Episode 7:  Risk Parity Radio Episode 7

Optimal Finance Daily Episode 1361:  https://oldpodcast.com/1361-annualized-returns-by-asset-class-from-1999-2018-by-sam-of-financial-samurai-on-reits-gold-investments/

Bigger Pockets Money Episode 153:  https://www.biggerpockets.com/blog/biggerpockets-money-podcast-153-bill-bengen

Earn & Invest Podcast November 30, 2020:  https://www.earnandinvest.com/episodes-2/supercharge-your-retirement-and-make-millions-more

Support the show

This is our weekly portfolio review of the portfolios you can find at https://www.riskparityradio.com/portfolios

The Portfolio of the Week is the Golden Butterfly, which you can learn more about here:
https://portfoliocharts.com/2015/09/22/catching-a-golden-butterfly/

We compare the Golden Butterfly Portfolio with the Rick Ferri Core Four at Portfolio Visualizer.  Link to analysis:

https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&mode=1&timePeriod=2&startYear=1972&firstMonth=1&endYear=2020&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=0.2&relativeDeviation=20.0&portfolioNames=true&portfolioName1=Golden+Butterfly&portfolioName2=Rick+Ferri+Core+Four&portfolioName3=Portfolio+3&asset1=TotalStockMarket&allocation1_1=20&allocation1_2=48&asset2=LargeCapGrowth&asset3=SmallCapValue&allocation3_1=20&asset4=LongTreasury&allocation4_1=20&asset5=Gold&allocation5_1=20&asset6=REIT&allocation6_1=0&allocation6_2=8&asset7=IntermediateTreasury&allocation7_1=0&allocation7_2=20&asset8=ShortTreasury&allocation8_1=20&asset9=IntlStockMarket&allocation9_2=24&asset10=TreasuryBills

Support the show

On today's episode I relate my experiences with peer-to-peer lending as an alternative investment to see if it is something you may wish to consider.  As always, we use David Stein's Ten Questions to Master Investing as the basis for our review:

1.  What is it?
2.  Is it an investment, a speculation, or a gamble?
3.  What is the upside?
4.  What is the downside?
5.  Who is on the other side of the trade?
6.  What is the investment vehicle?
7.  What does it take to be successful?
8.  Who is getting a cut?
9.  How does it impact your portfolio?
10.  Should you invest?

Here is the Money Life podcast regarding my winning gold-price prognostication.  Skip to 5:20 for just that section (but the rest is good too):  https://moneylifeshow.libsyn.com/oakmarks-mcgregor-you-cant-and-wont-generate-income-like-you-used-to

Support the show

We begin this episode with some nice questions about perpetual withdrawal rates and correlation metrics.   Then we proceed with our portfolio reviews of the sample portfolios at https://www.riskparityradio.com/portfolios

Additional links:

Morningstar/Swedroe podcast:  https://overcast.fm/+R6uKzooqI/30:25

Risk Parity Radio Bond Episodes:

Part One:  https://www.riskparityradio.com/podcast/episode/4965a5d2/episode-14-which-bonds-are-right-for-your-risk-parity-style-portfolio-a-comprehensive-analysis-part-i

Part Two:  https://www.riskparityradio.com/podcast/episode/4c25df5c/episode-16-which-bonds-are-right-for-your-risk-parity-style-portfolio-a-comprehensive-analysis-part-2

Support the show

I believe its all in the title.

Here are David Stein's Ten Questions to Master Investing for reference:

1.  What is it?
2.  Is it an investment, a speculation, or a gamble?
3.  What is the upside?
4.  What is the downside?
5.  Who is on the other side of the trade?
6.  What is the investment vehicle?
7.  What does it take to be successful?
8.  Who is getting a cut?
9.  How does it impact your portfolio?
10.  Should you invest?

And here is the Masterworks website:  https://www.masterworks.io/about/how-it-works

Support the show

This is our weekly portfolio review of the portfolios you can find at https://www.riskparityradio.com/portfolios

One of our portfolios, the Aggressive Fifty-Fifty, triggered a rebalancing band this week and so we also have a detailed discussion of rebalancing.

Link to referenced Kitces article:  https://www.kitces.com/blog/best-opportunistic-rebalancing-frequency-time-horizons-vs-tolerance-band-thresholds/

Support the show

In this episode we answer a listener question and provide a summary and analysis of RPAR, the Risk Parity ETF.  Links:

RPAR Third Quarter Review Slide Deck:  https://rparetf.com/quarterly-reviews/Review--1602725674-RPAR-Risk-Parity-ETF-Quarterly-Review-3Q20.pdf

RPAR Quarterly Reviews Page, Including Webcast:  https://rparetf.com/quarterlyreviews

Marketwatch List of RPAR Components:  https://www.marketwatch.com/investing/fund/rpar/holdings?mod=mw_quote_tab

Portfolio Visualizer Analysis of RPAR-like Portfolio vs. Golden Ratio Portfolio:
https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=1985&firstMonth=1&endYear=2020&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&showYield=false&reinvestDividends=true&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&symbol1=VTI&allocation1_1=10&allocation1_2=42&symbol2=VTMGX&allocation2_1=6&symbol3=VEIEX&allocation3_1=6&symbol4=XLE&allocation4_1=4&symbol5=XLI&allocation5_1=4&symbol6=XLB&allocation6_1=4&symbol7=TLT&allocation7_1=29&allocation7_2=26&symbol8=TIP&allocation8_1=29&symbol9=GLD&allocation9_1=8&allocation9_2=16&symbol10=VNQ&allocation10_2=10&symbol11=CASHX&allocation11_2=6

Support the show

This is our weekly portfolio review of the portfolios you can find at https://www.riskparityradio.com/portfolios

Support the show

In this episode, we analyze an investment in bitcoin for a risk-parity style portfolio using David Stein's 10 Questions to Master Investing, which are:

1.  What is it?
2.  Is it an investment, a speculation, or a gamble?
3.  What is the upside?
4.  What is the downside?
5.  Who is on the other side of the trade?
6.  What is the investment vehicle?
7.  What does it take to be successful?
8.  Who is getting a cut?
9.  How does it impact your portfolio?
10.  Should you invest?

Investopedia Article About Bitcoin:  https://www.investopedia.com/terms/b/bitcoin.asp

Article re $1B bitcoin loss -- now revealed as a US government seizure:  https://www.marketwatch.com/story/somebody-may-have-just-gotten-away-with-stealing-1-billion-11604592280?mod=home-page

Analysis of bitcoin vs. gold vs. total stock market fund:  https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=1985&firstMonth=1&endYear=2020&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&showYield=false&reinvestDividends=true&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&symbol1=GBTC&allocation1_1=100&symbol2=GLD&allocation2_2=100&symbol3=VTI&allocation3_3=100

Correlation analysis matrix of bitcoin (GBTC):  https://www.portfoliovisualizer.com/asset-correlations?s=y&symbols=VTI%2C+TLT%2C+GLD%2C+VNQ%2C+VNQI%2C+GBTC&timePeriod=2&tradingDays=60&months=36

Support the show

We begin with a monthly rant about "free-lunch" financial products that claim to provide stock market returns without stock market risk (and that usually bear clever names for marketing purposes).

Following the rant is our weekly portfolio review of the portfolios you can find at https://www.riskparityradio.com/portfolios

Support the show