Risk Parity Radio

In this episode we address a listener question from Joseph K. about Part 34 of Big ERN's SWR Series ("Using Gold as a Hedge against Sequence Risk"), which you can find here:

https://earlyretirementnow.com/2020/01/08/gold-hedge-against-sequence-risk-swr-series-part-34/

Additional Links:

RPR Episode 12:  Podcast | Risk Parity Radio

Big ERN's Option Writing Portfolio Strategy (Part 3):  https://earlyretirementnow.com/2019/03/27/passive-income-through-option-writing-part-3/

Homestake Mining in the Great Depression:  https://www.caseyresearch.com/daily-dispatch/gold-stocks-depression/

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

Additional links:

Choose FI Episode 275:  https://www.choosefi.com/board-games-and-war-games-ep-275/

Choose FI Episode 277:  https://www.choosefi.com/gauging-the-weight-of-your-portfolio-ep-277/

Choose FI Episode 194:  https://www.choosefi.com/the-role-of-bonds-in-a-portfolio/

Risk Parity Radio Bonds Part 1:   Podcast | Risk Parity Radio

Risk Parity Radio Bonds Part 2:  Podcast | Risk Parity Radio

Comparative Analysis of the Risk Parity Ultimate Portfolio Against A Rick Ferri Core Four:  https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=2&startYear=1985&firstMonth=1&endYear=2020&lastMonth=12&calendarAligned=true&includeYTD=true&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=0.0&showYield=true&reinvestDividends=true&portfolioNames=true&portfolioName1=Risk+Parity+Ultimate&portfolioName2=Rick+Ferri+Core+Four&portfolioName3=Portfolio+3&allocation1_1=0&allocation1_3=0&symbol2=VUG&allocation2_1=12.5&allocation2_3=0&symbol3=VIOV&allocation3_1=12.5&allocation3_3=0&symbol4=VOO&allocation4_1=12.5&allocation4_3=0&symbol5=EDV&allocation5_1=5&symbol6=TLT&allocation6_1=15&allocation6_3=0&symbol7=GLD&allocation7_1=10&symbol8=VNQ&allocation8_1=5&allocation8_2=8&allocation8_3=0&symbol9=VNQI&allocation9_1=5&allocation9_3=0&symbol10=VIXY&allocation10_1=2.5&symbol11=PFF&allocation11_1=12.5&symbol12=UPRO&allocation12_1=2.5&symbol13=CASHX&allocation13_1=0&symbol14=TMF&allocation14_1=5&symbol15=VTI&allocation15_2=48&symbol16=VXUS&allocation16_2=24&symbol17=IEF&allocation17_2=20

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

Additional Links:

RPR Episode 6 -- About The Golden Ratio Portfolio:  Podcast | Risk Parity Radio

Rick Ferri Core Four Portfolio Reference:   https://portfoliocharts.com/portfolio/rick-ferri-core-four/

Comparison Analysis of GolderRatio vs. Rick Ferri Core Four:   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=Rick+Ferri+Core+Four&portfolioName2=Golden+Ratio&asset1=TotalStockMarket&allocation1_1=48&allocation1_2=14&asset2=LargeCapGrowth&allocation2_2=14&asset3=SmallCapValue&allocation3_2=14&asset4=LongTreasury&allocation4_2=26&asset5=Gold&allocation5_2=16&asset6=REIT&allocation6_1=8&allocation6_2=10&asset7=IntermediateTreasury&allocation7_1=20&allocation7_2=0&asset8=ShortTreasury&asset9=IntlStockMarket&allocation9_1=24&allocation9_2=0&asset10=TreasuryBills&allocation10_2=6

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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

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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

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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

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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

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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

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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/

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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

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